Preamble
– The first part of this article presented an organizational look at the NTT
Group, which consists of five main groups and an astounding number of
subsidiary companies: 944 at last count with interests as diverse as IT
outsourcing, mobile apps, real estate, data centers, finance, construction, and
even electrical power. We also presented a number of operational showing that
NTT is indeed growing again at a 3.4% annual rate, and that in its home market
of Japan, NTT continues to hold the largest share of the mobile and fixed line
business.
The
Global Cloud Strategy
NTT may be the quintessential Japanese
conglomerate; however, the company now sees faster growth overseas than in
Japan. Recently, thanks to several key acquisitions as well as organic growth,
overseas sales and operating income are on a growth spurt.
Sales Operating
income
FY2015/3 US$15.0B US$0.67b
FY2016/3 US
$15.6B US$0.69B
FY2017/3 US
$16.9B US$0.80B
FY2018/3 (forecast) US$19.6B US$1.5B
The growing sales are based on what NTT calls its
Global Cloud Business Promotion System which is aiming for the “full stack” or
services, although delivered through sister companies rather than under a
unified brand. In that sense, it differs from the pure cloud providers, such as
Amazon Web Services, Alibaba or IBM. Of course, NTT also possess the physical
network assets, such as dedicated fiber pairs on subsea cables, that few others
can rival.
Here is the strategic picture
The
Data Centre Layer
Inside the group, the data center layer should be
the domain of NTT Communications, although in some overseas markets, other
subsidiaries take over this function. Here are some examples.
European
data centres: In August, NTT Communications, acting
through its European subsidiary e-shelter, inaugurated a new data center in
Bonn, Germany. The two-story Rhein-Ruhr 1 offers 2,700 square meters (sqm) of
server space, equivalent to 1,100 racks. The facility conforms delivers
data-center services based on more than 300 globally unified standards that NTT
Com’s Nexcenter facilities have implemented for equipment and operations. In
Europe, NTT Com delivers data center services in Austria, France, Germany,
Spain, Switzerland and the UK (see Appendix 1). NTT Com expands its data center
business to the Rhein-Ruhr region, one of the most expected data-center markets
in Germany mainly serving the customers from the public sector. In May, NTT
Comm inaugurated its Germany Munich 2 data centre (Munich 2) located in
Unterschleißheim, a suburb of Munich 16 km from the city centre, with the
facility managed by e-shelter, a NTT Com company and data centre services
provider in Europe. The two-story Munich 2 data centre initially offers 2,800
sq metres of server space, equivalent to 1,100 racks, with plans to expand the
facility to 5,600 sq metres. The facility is operating under NTT Com's
Nexcenter brand.
North
American data centres: In 2009, NTT Communications acquired an
80% stake in RagingWire, a wholesale data centre operator, for US$350 million.
At the time, Raging operated 650,000 square feet of data center space at
its campuses in Sacramento, California, and Ashburn, Virginia. Since then,
RagingWire has continued to build at a frenetic pace and is now one of the
largest data centre shops in the crucial Ashburn market. Late in 2016,
Ragingwire announced plans for its third data center in Ashburn’s “Data Center
Alley” measuring 245,000 square feet of space and 16 megawatts of power, The
VA3 Data Center joins RagingWire’s VA1 and VA2 data centers, which also are in
Ashburn. The combination of VA1, VA2 and VA3 creates a data center footprint of
over a half million square feet of space and 44.4 megawatts of power.
RagingWire also has massive data centers in Dallas, Texas and Sacramento,
California.
India:
In July, NTT Communications announced the launch of international data network
services in India through its affiliate NTT Communications India Network
Services (NTTCINS). NTT Com stated that the acquisition of its licence in India
follows the launch of construction of two new Indian data centres in Mumbai and
Bangalore, through subsidiary Netmagic, a provider of managed hosting and cloud
services in India. NTT Com said it plans to invest $160 million in building the
two data centres, which are scheduled to become operational by April 2018. The
new data centres will add nearly 500,000 sq feet of gross floor space at full
build out, increasing NTT Com's total gross footprint in India to 1,100,000 sq
feet. The new data centres in Mumbai and Bangalore will accommodate 2,750 racks
with 22 MW of power and 1,500 racks with 15 MW of power, respectively.
The
Managed ICT Layer
At the managed ICT layer, the NTT Group has several
overlapping interests at play.
First, NTT Communications is the wide-area
networking division within the group, offering a very wide range of services
from legacy corporate voice communications, to data networking, and cloud
computing. It has more than 380 subsidiaries of its own (including RagingWire
and e-shelter, as mentioned above) and more than 43,800 employees. We can
safely say NTT Comm does business pretty much everywhere in the world. The
revenue picture for NTT Comm follows.
Global
SD-WAN Launch
In June, a NTT SD-WAN
Service Portfolio was officially launched, offering coverage spanning over 190
countries, NTT Comm also announced the deployment of a fully software defined
network that provides the framework for the delivery of a suite of overlay
SD-WAN services for global and regional enterprises.
The
NTT SD-WAN platform is based on a new architecture that is locally distributed
at sites worldwide via over 75 local cloud centres (LCCs) that are optimised
for network, mobility and security. In addition, NTT SD-WAN real-time streaming
network analytics offers CIOs and IT staff insight into application
performance, network security and the end-user experience. The platform can
also support the delivery of services from CPE located at branch offices.
Key features of NTT
SD-WAN platform include:
- Real-time streaming network analytics based on NTT Com's application visibility reporting and analytics tool to help enterprise customers manage network workload and performance.
- Enterprise connectivity flexibility, with support for connectivity options such as local ISP, Internet, broadband, wireless, MPLS and LTE, plus cloud connectivity to major SaaS and cloud service providers.
- CPE flexibility, with the ability to select NTT provided or customer provided SD-WAN devices at branch offices.
- Optimised local ISP selection and routing, offering optimised connectivity to 1,000+ local network providers that connect customer locations in over 190 countries.
- Enhanced QoS, enabling the application and enforcement of QoS policies.
- Secure web gateways and application acceleration, with security via NTT Com's secure web gateways at LCCs and application acceleration via its LCCs.
The
Virtela line
The newly-launched SD-WAN service is not the first
time the company has reached beyond MPLS or other VPN technologies to build a
virtual network service. In 2014, NTT Communications acquired Virtela
Technology Services (Virtela) of Denver, Colorado, a global managed and
cloud network services provider serving over 500 multinational companies.
Virtela idea was to integrated 1,000+ local and regional network providers,
enabling the customer to build a virtual overlay network from multi-carrier
MPLS, Ethernet, DSL, 3G/4G/LTE and other IP links, while benefitting from a
single SLA and management portal. Virtela operates global operations and
delivery centers in the U.S., India and the Philippines.
