Without modern communication networks, digitization would come to a halt.
Foundations of digitization

Fascinatingly different

Who says time machines aren’t real? Just look at digitization: it has catapulted us into the future. One of the motors driving this machine are communication networks. And they shouldn’t be neglected in our drive to modernize.
Copy: Yvonne Nestler
Illustration: Matthias Schard
Podcast
Fascinatingly different
Podcast: Fascinatingly different
Alexa is a real workhorse. She lends a hand wherever she’s needed in the home: doing the shopping, turning on TV bias lighting and reserving the nearest vehicle through a car sharing platform. She’s an inexhaustible font of knowledge, tells jokes and, best of all, is never grouchy, but always has a sunny disposition. Alexa is popular, too. She works in over eleven million households in the United States alone. How? She’s a computer – albeit an extremely intelligent one: a 24/7 virtual assistant.
Though only two years old, Alexa had over 15,000 “skills” by mid-2017 – apps that give her new abilities. If you wish, your digital roommate will remind you to put out the trash for pick-up, update your shopping list or provide a current traffic report. But Alexa needs the Internet to work her magic. That’s because Alexa lives and thinks in an Amazon data center and connects to her owners over a data network. And she only works properly if the data travels so fast that users don’t even notice the delay.
Alexa is a digital assistant – and just one of many new tools that digitization has conjured up out of thin air. “Digitization has created entirely new markets and driven rapid growth in existing ones,” said Prof. Marion A. Weissenberger-Eibl, Head of the Fraunhofer Institute for Systems and Innovation Research (ISI) and Professor for Innovation and Technology Management at the Karlsruhe Institute of Technology. According to analysts, expectations have peaked for technologies such as machine learning, autonomous vehicles and connected homes. Virtual reality, for its part, is already tantalizingly close to the productivity stage. Like Alexa, these technologies are all about data – storing, linking and analyzing it. Not to mention transmitting it securely and reliably at inconceivably quick speeds. If organizations want to climb onto the digitization train, though, they will have to clear additional hurdles -- including the need to swiftly roll out suitable network connections. To do that, corporate networks need innovations that can accelerate global data transfer rates to a rapid pace. “We’re standing at the cusp of an entirely new era in network technology,” said Patrick Molck-Ude, Director of the Telecommunications Division at T-Systems (see page 14 "Ground rules for a new era"). “We’re moving away from rigid, complex local networks and toward agile, simple, global ones.”

WHO’S AFRAID OF ONLINE GIANTS?

Alexa can shop online – all thanks to networks.
Alexa can shop online, parking garages can communicate with cars, and department stores can welcome customers from a distance – all thanks to networks.
One group that has benefited from the new era of connectedness are retailers. E-commerce giants have thrust digital transformation onto the entire industry: from Alibaba to Zalando. In 2017, ten percent of retail sales currently come from e-commerce; by 2021, the percentage will increase to 15.5, according to eMarketer, a market research outfit. The engine powering this long-term trend is clear: customers carry around gateways to their favorite store in their pocket or purse. Or they go directly to a virtual assistant and order goods by voice command from their couch.
For retailers, it’s both a challenge and an opportunity. Digital opportunities are wide open for every company. From personalized advertising and freshness sensors for produce to mobile payments. “Could online retailers be more of a blessing than a curse for us?” asked Jens Jänicke, who runs a grocery store in Adendorf, Lower Saxony, Germany. “Obviously, there’s some risk involved in going digital. But it helps to try things out.”

THE STORE NEXT DOOR

To succeed, retailers have to maintain a presence near their customers, who might otherwise end up ordering online. One solution: open as many stores as possible. An expansion that dramatically places big demands on the corporate network since each new store needs its own network connection. “It used to take up to six months to run lines to new locations,” said Molck-Ude. “Service providers don’t have dense networks in every corner of the world, after all.” Instead, corporate network operators often had to embark on lengthy negotiations with local partners. And that took time.
To address this bottleneck, T-Systems has rolled out “Smart SD-WAN” (see "Virtualized network technology? Brightens the mood"). This latest enterprise network solution from the Deutsche Telekom subsidiary piggybacks on the global infrastructure of the ngena alliance, which interconnects its partners’ local networks to provide international lines and network services. No coordination required. Best of all, the entire global network is highly automated, thanks to software-defined networking technology (SD-WAN). Instead of configuring each network component manually, specialists can now manage the network centrally from a software console. On any infrastructure, too. “Today, we can provide connectivity for organizations much more quickly; it almost takes only one keystroke to provision firewalls and other services,” explained Molck-Ude.
"We’re standing at the cusp of an entirely new era in network technology."
PATRICK MOLCK-UDE, Director of TC Division T-Systems

RAPID RESPONSE IS NEEDED

Here’s an example. A new branch office, needing to get online quickly, uses a temporary cellular connection until a dedicated line can be provisioned. It then painlessly cuts over to the new line – a switch that no longer requires timeconsuming manual configuration. So flexible is this innovative network approach that retailers can not only set up new permanent locations, but can respond quickly to online competition by opening pop-up stores. As long as there is Internet access, they can essentially get the network infrastructure for these provisional shops overnight.
There are calls for adaptable networks in other industries, too. For example, Hartmut Beuß, CIO of the State of North Rhine-Westphalia, has said, “A modern state data network needs to provide high bandwidth and be able to adapt it quickly.” By 2018, 60% of enterprises will adopt software-defined networks for remote branch connectivity, predicts IDC.

FLEXIBLE CONNECTIVITY FOR A FLEXIBLE CLOUD

With the advent of 5G cellular technology, additional “virtual reality spectators” will attend concerts or sporting events.
With the advent of 5G cellular technology, thousands of additional “virtual reality spectators” will attend concerts or sporting events.
Organizations want more flexibility in using clouds, too. It’s easy to get cloud services ready. And even easier to give users access to public clouds over the Internet. But these connections just don’t offer the security or performance that many businesses and governments demand. It takes time to provision high-performance connectivity between a cloud and a secure network for thousands of employees. This is partly because each provider has different technical and organizational rules for connecting to its cloud. “However, organizations want the ability to connect to and switch cloud platforms quickly,” said Molck-Ude. To meet this demand, T-Systems plans to connect multiple clouds to enterprise networks over preconfigured gateways. That way, connections can be up and running in just a few days, instead of weeks, as is currently the case. The service is already available for Microsoft Azure Cloud in Germany, but will extend in the first half of 2018 to Microsoft Cloud Global and several data centers for Amazon Web Services. Other cloud providers and locations will follow.

TIME FOR REAL TIME

It helps little to provision networks quickly if the network itself is slow, though. Alexa, for instance, would seem positively slow-witted if her voice data lazily chugged its way from the data center to your living room. Or take cars. They should be completely autonomous by 2022, forecasts consulting firm Frost & Sullivan. But that implies that vehicles can look far into the distance – and so see black ice coming or know about the traffic jam around the next turn. For that to happen, data has to fly through the cellular network at a mind-boggling speed. Specifically, information needs to travel from sender to receiver in one millisecond or less. That’s a requirement that next-generation 5G cellular networks will meet.
Deutsche Telekom is already vigorously researching the superhero of cellular technology. At 5G:haus, its innovation laboratory, it works closely with start-ups, research institutions and network equipment vendors. By using technologies similar to SD-WAN, 5G:haus has managed to virtually separate high-bandwidth video streaming and time-critical autopilot functions while physically supporting them with the same infrastructure. Ultra-high data rates require something else, too: “We need new and significantly more antennas than before as well as running fiber to our base stations,” explained Christian Wietfeld, who researches 5G at the Technical University of Dortmund (see "When “real time” keeps its promise").
Mobile bandwidth has reached a turning point, too. In August 2016, a Deutsche Telekom test lab broke through the one-gigabit mark for the first time. Bandwidths are poised to skyrocket under 5G. ITU, the European standardization body, expects to see upload rates of 10 gigabits a second and download rates of 20 gigabits a second under ideal conditions. At that speed, you could don a virtual reality headset and experience live soccer matches as though you were sitting in the stands with the crowd instead of resting on your couch at home. And the 5G network wouldn’t even stumble if thousands of virtual viewers tuned into the match. According to ITU, it can feed data to a million devices per square kilometer – without any loss of quality. That’s 1,000 times more than today’s cellular networks.

SECURITY IN THE NETWORK

If cars are going to drive autonomously, sender/receiver information should take no more than a millisecond to transmit.
If cars are going to drive autonomously and ambulances are going to be able to turn traffic lights green, sender/receiver information should take no more than a millisecond to transmit.
Cars and VR headsets aren’t the only things going online. Today, vending machines order refills, machines request maintenance and smoke detectors notify fire departments. According to analysts, by 2020, over 20 billion devices will be connected worldwide. Numbers of this magnitude require more than just greater cellular network capacity; they demand an entirely new approach to cybersecurity. Every new device, every connected sensor opens up another potential backdoor for hackers.
Exhibit A are the botnets controlled by the Mirai malware, which gained notoriety after a DDoS attack on the DNS provider for Twitter, Paypal, Netflix and others in October 2016. Cyber criminals had infected hundreds of thousands of cameras and refrigerators and directed them to flood DNS servers with innumerable requests. “Big companies such as Microsoft, Google or Apple employ experts for IoT security to make things like smartphones as secure aspossible,” said US security expert Bruce Schneier. “However, if you buy a webcam to monitor your baby, a refrigerator or a thermostat, no expert for IoT security will have been involved with it.”
Problem is, there’s no practical way to roll out a standardized security concept to millions of connected devices. “That’s why we need security embedded in the network,” said Molck-Ude. “A global SD-WAN can help. It lets us provision network security services quickly, simply and consistently: firewalls, web security and separate virtual networks.” Networks can fend off DDoS attacks, too. T-Systems can automatically cut off an incoming deluge of requests at the backbone as soon as it receives attack reports from detection systems in the customer data center.

ONLINE WORLDWIDE – RIGHT OUT OF THE BOX

Telematics and IoT will be the foundational solutions for transportation and logistics systems and their value chains.
Literally fundamental. Telematics and IoT will be the foundational solutions for transportation and logistics systems and their value chains. More than 80 % of all network changes are manually driven.
​​​​​​​Companies interested in connecting their products to the Internet – say, in order to offer customers value-added services like remote maintenance – face another obstacle: they need worldwide cellular Internet service. Sounds easy – the Internet is everywhere, after all. In reality, it’s hideously complicated. Laws prohibit the use of one SIM profile to access the Internet for extended periods in different countries. Let’s imagine that a camera maker wants to package mobile connectivity with its products in 50 countries so that photographers can instantly upload their pictures to Instagram from anywhere in the world. To do this, it would have to sign a contract with a local Internet service provider for local SIM cards in every single country. Translation: 50 partners, 50 approaches, 50 rates. As if that’s not enough, the manufacturer has to charge photographers for their individual data use. Talk about a daunting task.
“But that’s exactly what our core competence is,” said Molck-Ude. “We offer organizations global integrated mobile connectivity as an all-in-one, single-source package.” T-Systems negotiates with local carriers and handles the billing. BMW, for example, brought in the Deutsche Telekom subsidiary to implement an in-car mobile hotspot so that passengers in over 50 countries could watch streaming video on the road. One day, these solutions may be built around eSIM technology, where an integrated SIM card switches, on command, from being a card for a French carrier to one for an Italian carrier.
With embedded connectivity, companies can connect their products to networks worldwide.
Point and shoot, not point and search: with embedded connectivity, companies can connect their products to networks worldwide. Camera makers, for example, can offer devices that come bundled with mobile connectivity.

MOBILE COMMUNICATIONS MADE EASY

Contract chaos is a problem for connected workers, not just connected devices. In the US, UK and Australia, 80 percent of employees have one or more corporate-issued mobile devices, according to analysts. And they have the same problem as the cameras in our previous example. Organizations end up partnering with multiple cellular carriers, depending on where they do business, and then juggle different contracts, rates and invoice formats. To avoid these kinds of headaches, Deutsche Telekom has joined forces with TeliaSonera, Orange and Telecom Italia to form the European FreeMove Alliance. Being a subsidiary of an alliance member, T-Systems can provide multinational corporations with mobile communications in over 100 countries – but with only one point of contact.
Next-generation communications networks are fast, agile, simple and secure. That’s how they drive digital innovation around the globe. They can beam virtual assistants onto our smartphones as we sit in a train or on a beach. And who knows? One day, Alexa may end up as a secretary, sorting e-mails, booking conference rooms and answering phone calls. Or maybe she’ll help customers find their favorite pasta at the grocery store – all thanks to a powerful network.

Facts and Numbers

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