April, 22, 2020
Recent online conference RBC Digital Forum held by business media holding RBC brought together leading tech experts on April 14. The agenda of the forum was “Digital Mobilization” with focus on how the digitalization of businesses may change Russian society and tech industries.
Vera Kozyr, the CEO and co-founder of notAnotherOne, participated in the roundtable discussion "The stakes are rising. Who is craving big data volumes and high bandwidth in Russia?".
Data center load, changes in transfer speeds during crisis, and the consequences of the growing use of big data and IoT were the main topics covered by representatives from Mail.ru Cloud Solutions, Comfortel, CS Group, DataLine, Ruckus Networks and Lenenergo. Here's a quick recap of what the experts discussed.
How the current epidemiological situation affected the telecom market
The conversation started with an evaluation of how the telecom market is handling the current crisis.
The growth of remote work and streaming services usage due to lockdown measures caused internet traffic to increase by half. Some internet service providers (ISP) experienced "last mile" issues, but there were only local cases like this. It was internet giants like Yandex and Mail.ru, alongside the large digital services providers like Rostelecom, whose work was put in jeopardy. Their increased loads require specialized equipment such as DWDM equipment, and there are no domestically produced alternatives.
Certain risks arise from delayed shipments of specialised hardware from China, as they require businesses to assess their needs and push their procurement plans at least two months ahead of schedule.
The speakers don't expect networks to collapse though due to there being enough reserve capacity. The slowdown in demand for cloud services is another reason for that. Ilya Letunov, Head of Mail.ru Cloud Solutions shared that even though their company witnessed a 20% growth in customers over the past several months , they expect a slowdown in the future. The businesses that planned cloud migration, have already done that, while the rest will probably wait for calmer times due to the complicated business operations associated with it.
Who needs high-speed data traffic and large data transfers
The experts also discussed which technologies and digital transformation trends are having an impact on the data center and broadband access markets. First of all, the speed of data exchange is important for the transmission and recognition of images in real time for surveillance systems and facial recognition; even the retail industry benefits from digitalization – with the help of video surveillance retail stores calculate the number of visitors, generate heat maps and analyze customer behavior.
Another prominent area of data transmission is V2X (vehicle-to-everything communication, where smart vehicles interact with other cars, traffic lights, sensors installed alongside roads, and other sensors within road infrastructure. The development of public transportation, carsharing, self-driving cars, and the smart city projects implies a huge jump in the generation and consumption of data. Smart video surveillance is one of the projects from this area that notAnotherOne is developing at the moment. According to product developers’ experience, bandwidth and data volume limits can hinder the successful implementation of object recognition as not all high-definition footage can be streamed to the cloud for processing. That makes product developers look for optimal engineering and software solutions to reduce the amount of data to send to the cloud.
Linxdatacenter and its partners deployed the monitoring system for public utility emergencies in the Ural region and this project stands as another example of how the public sector outside the central regions use IoT technology. Sergey Yartsev, CS Group, noted that the production industries require massive data traffic and large bandwidth to transfer and store all raw data which is crucial for machine learning algorithms used to build, for example, predictive maintenance solutions for industrial equipment.
An increasing amount of data streaming through smart devices, such as speakers and displays, is one clear trend seen in the B2C segment. European broadband providers report that smart displays are gradually outpacing smartphones in the data transmission volumes as a result of audio and video streaming and video conference calls. The data traffic growth from these types of devices in Russia is only anticipated but seems inevitable.
An alternative perspective on the Internet of things was shared by Mikhail Soloviev, Product Development Director in DataLine. As a cloud computing service provider, they expected that the spread of the IoT would lead to a multiple increase in the amount of data stored in their data centers, but that's not the case. Edge computing for IoT is one of the reasons. This technological process, when collecting and processing data is done via peripheral devices prior to transmission to cloud storage, keeps the latter from being cluttered with nonessential information.
Other experts support Mikhail’s ideas: sooner or later smart devices will become self-sustaining and will be able to process raw data locally without the need to transfer huge chunks of data to the cloud for validation.
Which technology trends will influence the data center and broadband service markets?
It's not the quantity of commercial data centers that experienced extensive growth from 2016 – 2017 that people are looking for these days, but the quality of services instead. 5G implementation, for that matter, can substantially enhance a bandwidth and achieve low latency.
Speaking of market drivers, we see an emerging trend in the Western world when the application of supercomputers with their high-performance operating systems goes beyond military and scientific areas and becomes available to small and mid-size enterprises. This trend will eventually influence the Russian cloud computing market as well. Competition between Amazon and IBM in that area led to supercomputer capacities becoming more affordable as a service; due to more powerful capacities, mid-sized businesses acquire unique business advantages. There is no significant demand for supercomputers in Russia at the moment, especially when we talk about mid-sized businesses. So far, this trend is led by Sberbank’s initiatives and some Skolkovo startups trying to build their business models around ML-based solutions for defense industry and large scientific projects.
Another notable trend is machine learning where according to Ilya Letunov’s opinion Google and Amazon are the main competitors. IT development is increasingly migrating to the cloud: 3-4-year-old businesses have their data stored in the cloud by default, whereas all new European or American mobile apps are already cloud-native. Vera Kozyr mentioned that notAnotherOne is also actively using cloud computing services, such as online 3D rendering.
State regulations of the telecommunications industry and electricity accessibility were named as some of the limiting factors. Companies in Moscow and Saint Petersburg create the primary demand for data centers, as noted by Mikhail Soloviev. Offline visits of company representatives to data centers are pretty common, despite solutions for remote management being provided, which makes deployment of data centers in remote areas inconvenient for customers from big cities. Meanwhile, getting a sufficient amount of electricity to ISPs in Moscow is still quite a challenge.
Are investments needed to satisfy the market demand?
The moderator raised the question of whether participants plan to invest in data center development in light of a growing demand for increased capacity. The experts highlighted that a building strategy during a crisis is risky, since data center investments are calculated in hundreds of millions of dollars. New server racks are built on demand. Too many server racks can lead to oversupply on the market, and prices may plummet.