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Why OT Is HOT for Telecom Vendors

Ray Le Maistre
8/27/2015
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Every telecom sector vendor is facing the same challenge: find new revenue streams. Just being a developer and supplier to telecom operators is no longer a viable business for most.

So here's the good news -- the critical infrastructure market, particularly the utility companies such as electric/nuclear power firms, will very soon need to invest in new networking and security technologies, for a number of different reasons, including the migration from TDM to IP, the emergence of IoT and a particularly pressing one, the need for electric power utilities in the US to meet stringent security requirements by April 2016. (See A Critical Time for Critical Infrastructure.)

Those security requirements are in place because there are serious concerns about organized, malicious attacks intended to disable the operational technology (OT) frameworks -- communications infrastructure, supervisory control and data acquisition (SCADA) systems, industrial control devices, sensors and other gear -- of the critical infrastructure operators.

That, and the other trends, mean there's new business to be won and, potentially, the addressable market for communications networking and security vendors (and let's not forget the systems integrators!) could be worth billions of dollars per year.

Some vendors, such as RAD Data Communications Ltd. , are already targeting the critical infrastructure market, where companies can't afford to rely on public networks and need to build their highly resilient, rugged and secure networks. According to the company's CEO, Dror Bin, it's already generating about a third of its revenues: See him talk about the critical infrastructure market in this video interview, starting at about three minutes in:


RAD Data is not alone, of course. Giants such as Alcatel-Lucent (NYSE: ALU) and Ericsson AB (Nasdaq: ERIC) are heavily engaged and many of the Ethernet equipment and security vendors have their eyes on the prize. (See NEC Lands Deal at Oil Refinery in Kuwait and Emerson Outlines Strategies for Battery Optimization.)

The importance to the telecom vendor community of this market is only going to grow, so we'll be tracking it on Light Reading in our dedicated critical infrastructure content channel.

In the coming months we'll be looking at the key trends, key players and market potential. To kick it all off, my colleague Dan O'Shea has taken a detailed look at why this market is important to the Light Reading community -- check out his Prime Reading article, Critical Infrastructure: Why Telecom Is Taking a Renewed Interest in the Utility Sector.

— Ray Le Maistre, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, Editor-in-Chief, Light Reading

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Ray@LR
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Ray@LR,
User Rank: Blogger
8/28/2015 | 6:30:16 AM
Different takes on the market
It's going to be interesting to see how different vendors make use of their existing portfolios, partmner with others, and customize thei9r solutions to meet the specific needs of the critical infrastructure sector.

Front and center right now are the security challenges - and that looks like a gilt-edged chance for systems integrators and consultancies to develop delpoyment and operational strategies for utilities and other firms (if theyc an afford it!) 
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