Equipment manufacturers like Ericsson, Cisco and Nokia are trying to convince the network operators that a ‘hollow' network is a good idea. But is it? What are the political implications of ‘hollow-ness'?
The telecoms equipment manufacturers want to take over the management of the networks, and they are wrapping it up in a snazzy-sounding marketing concept called the ‘hollow' network. It means that companies which have hitherto only operated in the background of the telecoms business - manufacturers such as Ericsson, Nokia, Siemens, Alcatel-Lucent and Cisco - will become more involved in the day-to-day running of the networks.
Beneath the marketing razzamattaz there hide some serious issues. At a time when the European Commissioner for Information Society, Viviane Reding, believes that the telcos will power Europe out of recession, is this really the right move? Moreover, if the network operators arean empty shell, who is then liable for the content?
The ‘hollow' network concept is that the network operators outsource more and more of the network management to the equipment manufacturers, who are setting themselves up as ‘managed services' and claim they are taking on some high profile contracts, such as Telefonica O2 in the UK.
One issue is that equipment vendors are not always able to manage equipment from other vendors - meaning that it could be a ploy for market control. Smaller vendors are less likely to get contracts if their equipment cannot be managed by the chosen supplier. Not too good for the competitive, vibrant digital economy that the European Commissioner wants to build.
Put into the political context, Mrs Reding says she wants the digital communications industries to power Europe's economic revival. At the same time, the Council of Ministers is pressuring the Parliament to support legislation that will permit blocking and other discriminatory practices in respect of Internet users traffic, as well as national measures to force network operator liability for copyright enforcement. What are the implications of these developments when viewed holistically?
The heart of a telecoms company is the network, and it reflects the underlying market value. Certainly, for the digital future, that is where the value lies (ask BSkyB's chairman James Murdoch who masterminded his company's purchase of an ISP and its integration into a content business). Thus, any European telco which went ‘hollow' could risk losing shareholder value, which is not a good start for an economic growth engine.
There is another issue for society. In an environment where telcos are being asked to censor for political purposes, such as enforcement of copyright, who will be liable? This is very serious issue. ‘Network management' is sometimes used by the telcos as a euphemisim for deep packet inspection and the automated ‘traffic management systems' which can be used to discriminate against competitive content, and prioritise favoured content. In the truly ‘hollow' network scenario, taken to the fullest extent, companies such as Cisco, Ericsson and Nokia could be blocking or allowing users' access to content and services, and implementing sanctions against users for copyright infringement.
The point is, that without any regulatory oversight, we would never know who was really responsible. And instead of economic recovery, Mrs Reding could be overseeing the 'communications crunch'. It's just a thought.
The telecoms consultancy Light Reading has written a report on the ‘hollow' network .
Viviane Reding - Digital Europe: Europe's Economic Recovery See page 8 for her views on copyright enforcement and "piracy".
The relevant EU legislation is the Telecommunications Framework, subject to review in the so-called EU Telecoms Package. If you are not familiar with the issues in the Telecoms Package, please read my articles elsewhere on iptegrity.com.
This article is licensed under a Creative Commons Attribution Non-commercial-Share Alike 2.5 UK:England and Wales License. http://creativecommons.org/licenses/by-nc-sa/2.0/uk/ It may be used for non-commercial purposes only, and the author's name should be attributed. The correct attribution for this article is: Monica Horten (2009)Has Mrs Reding heard of the hollow network? , http://www.iptegrity.com 2 September 2009.