Light Reading
Utility companies face many of the same network transformation issues as telecom players but their needs are also unique to the power sector.

UTC Telecom 2014: More Power to You

Jason Meyers
5/8/2014
50%
50%

PHOENIX, Ariz. -- The general consensus among the technology vendors exhibiting at the Utilities Telecom Council's Telecom 2014 conference here is that when it comes to their communications needs, utilities are not unlike telecom network operators -- except that they are very, very different.

Utilities are indeed grappling with issues and surveying opportunities reminiscent of the mid-1990s telco era: They operate aging, outdated communications networks in need of modernization, and they realize that through network investment they can provide more advanced and automated services that will improve the customer experience and save costs.

They also share a modern-day challenge with today's telecom networks operators. As they implement services such as smart metering, they are flooded with data that can give them insight into customer experience and performance, which makes network management more complicated.

"The more complex their networks get, the more need they have to manage all the devices getting pulled onto their networks," says Steve Curcio, vice president of industry and society for Ericsson AB (Nasdaq: ERIC).

But while the technology considerations in question may be similar to the telecom world, the attitudes of utilities toward change are not.

"These aren't telecom carriers," says Mark Madden, regional vice president for North American utilities at Alcatel-Lucent (NYSE: ALU). "They are very dependent on things being very reliable -- the tried and true. Any time you suggest something new to them, they get nervous."

Despite that nervousness, technology vendors are attracted to this potentially multi-billion-dollar market sector because most utility companies operate multiple internal communications networks that are in desperate need of modernization. Utilities' traditionally TDM-based systems are increasingly bandwidth-constrained as they add more applications such as smart meters and substation automation to provide real-time information monitoring and control, boost electric systems reliability and give them faster service restoration capabilities.

"Old analog technologies don't support these applications," Madden says. What's more, he adds, many telecom operators are shutting down the TDM-based services, such as frame relay and fractional T-1s, that many utilities use, prompting them to migrate to IP-MPLS or Carrier Ethernet connections.

All these factors combine to make the utilities’ communications network transformation seem like something of a forced march, though telecom professionals within utility organizations do seem to recognize the need for change.

"Doing nothing is not an option -- the transformation has to be made," says Doug McGinnis, senior manager and networking engineer for Exelon, during a conference session on TDM-to-IP migration. Exelon is a holding company that owns utilities in Maryland, Illinois, and Pennsylvania. "I'm happy to see TDM go away, because it's going to drive implementation of these new technologies. We're going to save a lot of money -- we're going to spend a lot, but then we're going to save a lot."

RAD Data Communications Ltd. recognizes that selling network technology to utilities is not the same as selling to telecom operators. The company adapted its network offerings to appeal to utility people responsible for different functions, says Mati Epstein, RAD's line of business manager for utility and transportation. "When you come to a utility, you must know who you are talking to," he says. "The packaging should be different."

Ciena Corp. (NYSE: CIEN), for its part, also recognizes the opportunity to adapt to meet the needs of the utility sector. "They're very concerned about modernization, and packet optical is proving to be a good transition from their legacy core," says Malcolm Loro, director of industry marketing for Ciena. "As they implement things like smart grid and need end-to-end solutions -- that's when you see the telecom vendors getting involved. We're working with these guys to bring carrier-class capability to these new networks."

— Jason Meyers, Contributing Editor, Light Reading

(6)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View
jasonmeyers
50%
50%
jasonmeyers,
User Rank: Blogger
5/9/2014 | 9:29:06 AM
Re: Utilitarian
I'd say so, yes. 
Ariella
50%
50%
Ariella,
User Rank: Light Sabre
5/9/2014 | 9:25:21 AM
Re: Utilitarian
@jason so we can be somewhat optimistic about the prospect.
jasonmeyers
50%
50%
jasonmeyers,
User Rank: Blogger
5/9/2014 | 9:21:14 AM
Re: Utilitarian
Areiella, I think it's just a matter of time, and the utilities seeing proof that packet technologies can meet their needs. We'll continue to dig in and present all sides of the debate. 
Ariella
50%
50%
Ariella,
User Rank: Light Sabre
5/8/2014 | 2:37:28 PM
Re: Utilitarian
@jason do you have your own opinon on the debate over IP readiness? 
jasonmeyers
50%
50%
jasonmeyers,
User Rank: Blogger
5/8/2014 | 1:05:50 PM
Re: Utilitarian
Thanks Dennis. It's also interesting to note that some of the utility telecom people are still wary of packet-based technologies for certain critical, latency-sensitive functions. Doug McGinnis of Exelon said he will keep teleprotection links--which have to communicate within milliseconds to prevent potentially catastrophic system failures--on Sonet, because he does't think IP is ready to handle it yet. Others don't agree, and have already migrated teleprotection to IP. One of several technology debates in this sector.  

 
mendyk
50%
50%
mendyk,
User Rank: Light Sabre
5/8/2014 | 12:15:04 PM
Utilitarian
Great overview, Jason. The sense I'm getting here at the event is that "IP transformation" will accelerate, in large part because legacy options (like leased lines) are going away. It's also clear that U.S. utilities are far behind their counterparts in Western and Northern Europe in this transformation.
Flash Poll
From The Founder
It's clear to me that the communications industry is divided into two types of people, and only one is living in the real world.
LRTV Documentaries
EE: The Road to 5G

12|16|14   |   16:02   |   (1) comment


Andy Sutton, the principal network architect at UK mobile operator EE, explains how his company is using Wembley stadium as a wireless test bed and how that's helping EE to plan the evolution to 5G.
LRTV Huawei Video Resource Center
Highlights of Huawei's NFV Open Cloud Forum 2014

12|16|14   |     |   (0) comments


Huawei hosted its inaugural NFV Open Cloud Forum during the SDN & OpenFlow World Congress 2014 in Düsseldorf, Germany. The Forum brought together technology thought leaders, senior executives and telecom professionals from global carriers, industry associations, as well as other partner companies in the ecosystem, to exchange views on and collectively explore how ...
LRTV Custom TV
Realizing Operators' Digital Vision

12|16|14   |   5:23   |   (0) comments


Leveraging technology is fundamental to digital transformation but understanding customers and serving them really well is at the heart of digital businesses. TM Forum lists the following as the strategic pillars of the digital business: business agility and rapid innovation, operational agility and effectiveness, IT and data centricity, plus customer centricity. ...
LRTV Documentaries
US Cellular Injects Analytics Into LTE

12|16|14   |   2:57   |   (1) comment


US Cellular's Mario Vela explains how the operator uses analytics for network planning and what comes next as the carrier looks to eke more value out of its metrics.
LRTV Interviews
How Cox Biz Plans to Keep Growing

12|15|14   |     |   (1) comment


Steve Rowley, SVP of Cox Business, details how the third-biggest US MSO intends to boost its revenues to $2 billion and beyond over the rest of the decade
LRTV Huawei Video Resource Center
Interview With Bill Zhang, Director of SoftCOM Product Management, Huawei

12|15|14   |   2:50   |   (0) comments


Bill Zhang elaborated on Huawei's open philosophy in NFV solution development and network architecture design at the SDN & OpenFlow World Congress 2014.
LRTV Huawei Video Resource Center
Event Highlights: Huawei at SDN & OpenFlow World Congress 2014

12|15|14   |   3:43   |   (0) comments


Huawei joined the 2014 SDN & OpenFlow Congress as one of the key sponsors and contributors. At the event, Huawei reinforced the openness and flexibility of its network infrastructure strategies, and provided updates on its SDN and NVF innovations. Through participations at the exhibitions, forums and speeches, Huawei encouraged the industry to "think bigger and ...
LRTV Interviews
How Cable Biz Services Hit $10B Mark

12|12|14   |     |   (1) comment


Cable operators reached $10 billion in annual business services revenues by delving deeper into their vertical markets and expanding beyond the smallest firms.
LRTV Documentaries
Mediacom Aims to Test Connected Tractors

12|11|14   |   05:07   |   (3) comments


Cable business service provider is taking its services to the 'agribusiness' sector in partnership with farm equipment specialist John Deere and is getting involved in Gigabit Cities developments.
LRTV Interviews
TWC Business Looks Beyond $3B

12|10|14   |     |   (0) comments


TWC Business Services chief Phil Meeks explains how his unit has reached $3 billion in annual revenues and what its plans are for next year.
LRTV Documentaries
AT&T's New Security Strategy

12|10|14   |   02:36   |   (1) comment


AT&T's Chief Security Officer Ed Amoroso explains how his company is wrapping virtual security layers around micro network domains.
LRTV Documentaries
2020 Vision: A First View

12|9|14   |   02:25   |   (3) comments


At the 2020 Vision Executive Summit in Iceland, unique Heavy Reading research shows that comms service providers are optimistic about the next five or so years.
Upcoming Live Events
February 10, 2015, Atlanta, GA
April 14, 2015, New York City, NY
May 6, 2015, McCormick Convention Center, Chicago, IL
May 13-14, 2015, The Westin Peachtree, Atlanta, GA
June 9-10, 2015, Chicago, IL
Hot Topics
Vodafone to Ride T-Mobile Back Into US
Dan Jones, Mobile Editor, 12/12/2014
1-Gig: Coming to a Small Town Near You
Jason Meyers, Senior Editor, Gigabit Cities/IoT, 12/17/2014
Cisco Makes Big Analytics Push
Mitch Wagner, West Coast Bureau Chief, Light Reading, 12/11/2014
Gardner's Departure a Cautionary Tale
Carol Wilson, Editor-at-large, 12/12/2014
T-Mobile Lights Up 27 Wideband LTE Cities
Sarah Reedy, Senior Editor, 12/15/2014
Like Us on Facebook
Twitter Feed
Webinar Archive