July 15, 2024 • 25 mins
Returning to one of our favourite topics – AI – but this time from a different angle. We’re going to look at the impacts of AI on network operations and infrastructure with none other than Jürgen Hatheier, CTO International from Ciena. Jürgen brings more than 20 years of telecommunications experience in software, hardware, and network operations, and joins us to share insights from Ciena’s global study of telecom and IT engineers about AI and the network.
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Speaker 1 (00:03):
Welcome to Vocus Inspire, the podcast full of brilliant ideas
for business.
Speaker 2 (00:10):
Hi, I'm Luke Coleman, head of government and corporate affairs
at Vocus, Australia's leading specialist fibre and network solutions provider.
Before we get things underway, we want to acknowledge and
pay our respects to the traditional custodians of the land
from wherever you're listening. In this podcast, we dive headfirst
into what's on the minds of Australian business and government
(00:30):
leaders to help inspire you and your organisation to go forward,
go further and go faster. So let's go.
Hello and welcome to the Vocus Inspire podcast. Today we're
returning to one of our favourite topics, AI, but this
time from a different angle. We're going to look at
(00:51):
the impacts of AI on network operations and infrastructure, with
none other than Juergen Hattaya, CTO International from Sienna. Juergen
brings more than 20 years of experience in telecommunications software.
Hardware and network operations, and he's joining us to share
some insights from Sienna's global study of telecom and IT
(01:15):
engineers about AI and the network. Welcome to the podcast, Jurgen.
Thank you, Luke. I'm glad to be here. It's great
to have you with us. So, start off, there is
so much hype around AI at the moment, you know,
the Gartner hype cycle is in full swing. So tell
me to start off, what excitement.
you most about AI and what it might deliver. Well, that's,
(01:36):
that's a nice icebreaker, Luke. And, um, I got to
be careful not to take the entire podcast with question one,
because I'm truly excited on what's happening. So, I'm a,
I'm a big picture guy, right? And, uh, when I
look at AI, I really see, uh, digital revolution happening here.
Not only one that gives us new technology, but one
that will create wealth, disrupt existing systems and processes. But
(01:58):
most important,
Only, it's gonna give us tech that improves our life,
various aspects of life. Be it, you know, at home, where,
you know, we use AI to check our kids' homework,
which we don't understand anymore. Simplifying daily routines and automate things.
But also in the workplace, I think we have only
seen the beginning of how AI can really help us
to make a difference and maybe get some time back. Um,
(02:19):
but lastly, I want to mention that, you know, the
impact that we see, especially in the medical space.
Is something that truly will touch us, you know, be
it young or old, uh, you know, be it poor
or rich, I think this will really help. AI will
help us to get, you know, better care for all
of us globally. Fantastic. Well, let's dive into Sienna's study.
(02:40):
I'm really interested to hear, uh, about what AI is
expected to do in terms of increasing data on.
Works. A lot of the listeners to this podcast are
going to work in the telecommunications industry. It's something that
I think we are all, uh, wondering about, what is
the impact of AI on our network. So what did
you find in that study and what is driving what
is expected to be a significant increase in network capacity,
(03:04):
and then I guess what challenges is that going to
present for telcos?
You know, it's really the number one question that I'm
discussing with all of our customers right now. And I
got to tell you up front, even though we conducted
a study, I don't have a crystal ball or silver
bullet to offer today to answer that question. But there
are a few things we know, right? We know that
the big investment cycle in data centres is a very
(03:26):
good leading indicator for what's, what's happening to connectivity later on,
be it in data centre interconnect or even
Access networks. So while we are talking to a lot
of our customers on a daily basis, we have conducted
this study to get a broader view on the market,
an opinion, an educated opinion from the experts. So, um,
this large-scale assessment really has helped us to understand where
(03:49):
people do expect the traffic to increase. And we have
seen 29% of our service provider customers in Australia tell
us that, um, traffic.
Between the data centres is gonna grow significantly, but also
on the edge. And um taking another number here, 91%
of the service providers expected AI to increase traffic.
(04:10):
By more than 10% on top of the natural traffic growth.
So really, that growth is gonna be driven largely by
the adoption of AI, be it in the end user
space or in the enterprises. And, um, we have also,
you know, looked at, you know, what type of traffic
is there. So, I don't know if you're familiar with
the so-called multimodal AIs, which are combining text, video, uh,
(04:34):
as well.
speech to have a complete immersive experience when you communicate
with AI. And that's gonna be driving, you know, significantly
new network requirements, not only bandwidth growth on top of that. So, again, 42%
of core networks will absolutely require, uh, upgrades according to
that study, as well as 28% of the data centre interconnect.
(04:55):
So the big pipes that are connecting the compute hubs
with each other. And, um,
That's really where we focus as CN on to, you know,
bring innovation, simplification, efficiencies to enable our service provider customers
and telcos to build new services and build new revenues.
Jurgen, I'm guessing that not all industries are going to
(05:16):
be impacted in the same way initially by AI. So
tell me, what are some of the key industries uh
where you're expecting AI is going to drive the biggest
increases in data? We absolutely believe that, you know, uh,
the leading industries in adopting digitalization and automation will also
(05:36):
lead the charge in in uh adopting AI.
Um, our study has, however, surprised us because we have seen, uh,
our respondents telling us they expect the financial services to
lead the charge. Whereas previously, we have seen media and
entertainment kind of being the big drivers for new connectivity
requirements for higher bandwidth, bigger speeds in the past. That
(05:58):
is surprising because, you know, when you look at all
of the main drivers of network capacity in recent years,
it's huge amounts of
Uh, a video or massive game downloads that particularly at
the consumer level, uh, blow out data and capacity requirements. So,
what is it about financial services that is going to
(06:19):
lead to such high volumes of data? Have you got
any kind of real world examples of, of what's happening
in the finance sector? I, I do, but I also
had to unpack this a little bit for myself because
I didn't expect that a couple of million or even
billion lines of transactions are going.
Cause all this extra traffic on the network. But, um, 55%
of our, uh, survey respondents do believe that, you know,
(06:41):
there is that significant decrease. And as we unpack those
use cases, clearly, it's not only about the transaction, right?
But it's about the deep analytics that you apply to,
you know, those customer interactions in the financial system. So
it's understanding trends, doing risk assessments, checking for regulatory compliance.
But there is also one use case which has used
(07:03):
AI for a couple of years already, and that's fraud detection.
I think we all have been exposed to one or
the other level of fraud, and it becomes vital that
AI's are being used to detect those as the adversaries
will also be using AI to find new holes, um,
in the financial industry to break in.
(07:23):
But like every other industry, I believe there is one
aspect where AI will absolutely generate new and more traffic
and that when it comes to customer services and customer interaction.
Everybody knows that be on the telco side, financial services,
health services, customer experience is key, how you serve your customers.
(07:44):
And by using, especially generative AI technologies to have better interaction,
be it on voice or video with your customers, you
will be driving significant amount of data through the network,
in the access, in the edge, and, uh, roll that
into your financial decision process. So, I would say absolutely,
financial industry has always been very innovative in adopting these
(08:04):
new technologies.
And hence, um, you know, surprised on the one hand,
but not surprised on the other hand to see that
they come up as one of the leading, uh, industries
in adopting AI and putting traffic on the network.
So if we're expecting to see these significant increases in
network traffic, then when you're talking to your telco customers,
(08:25):
no surprise, it's gonna be a hot top talking, uh,
hot topic, I should say, talking about how they're going
to upgrade their networks. So tell me, Jurgen, what kind
of investments are you expecting to see from telcos and
what should organisations be looking for for how they're going
to support their AI integration?
That's a fantastic question. And, um, firstly, in conversations with
(08:47):
our customers, people are still a bit hesitant to make
large scale investments into certain domains, because AI really hasn't
hit the network yet. So you don't know if you're
gonna see a lot of training traffic in the core.
You're gonna see a lot of inference traffic on the edge,
but our customers are readying themselves with network architectures and
concepts to really support the growth to come. So people
(09:11):
do expect that
We will need to invest into road and technology, so
the underlying optical network. Actually, 47% of Australian operators do
believe that they will need to upgrade those networks. Other,
another 44% think that the upgrade of the routing and
switching infrastructure on top of that will be a key challenge.
But more than anything, 98% of all respondents to our
(09:34):
survey said that they absolutely need to upgrade the fibre network.
And the fibre network, you know, has become, you know,
a lifeline, the arteries of, of our telecommunication globally. And
so organ
look at the fibre network to really address the significant
growth of bandwidth, low latency requirements, but most importantly, fibre
(09:55):
is very reliable. So you don't have any active components
in the line of communication and hence, this will be
The, the, the media of choice. So, but networks is
really not where it stops. I, I look at our
customers and they're really reinventing themselves in that inflexion of
AI hitting the networks. So they are thinking not only
(10:17):
about upgrading network connectivity,
But also upgrading the services portfolio that they're offering to
their end users. So some folks might think, hey, yes,
I need to offer a pipe to connect my enterprise
to the cloud, but the enterprises have very distinct requirements,
which may need some on-site or on the edge compute.
And edge computing has been in, you know, in discussion
(10:39):
for the last decade.
But now, I believe in our customers believe that we
are on the brink of, you know, investing in the edge,
to really bringing that compute closer to the end user.
Now when you were talking earlier about the finance sector,
you were talking about generating a lot of data, analysing, uh,
transactions and that sort of thing. And when it comes
(11:00):
to networks, there is also a lot of attention on
network analysis software. So what can you tell us about this?
Why is it so important in this new AI environment?
So we have been using software to optimise and analyse
and configure and troubleshoot our networks for, since the inception of,
of communications and
(11:21):
It's also not new news that AI has been an
important part of the network optimisation and analytics for many
years already. And, uh, our customers have been doing a
fantastic job on running the networks very efficient, very reliable
over many years. I mean, uh, looking at networking, this
is a utility. It is the backbone of many of our,
(11:42):
you know, financial transactions, of our communication. So if our
folks would have done a bad job, then, you know,
we wouldn't be where we are today.
Um, a reporter asked me earlier this week, do you
think that, you know, running networks more efficient running networks, um,
you know, AI support will allow you to offset.
(12:02):
What AI is going to put on the network in
terms of additional traffic. And I, I was, I was
just smiling and laughing. I said, do you think the
networks are being run so poorly today that you will,
you know, need an AI to help you run those?
I don't think so. We might be able to squeeze
out the one or the other percent of additional capacity or,
or bandwidth from the existing assets, but it will not
(12:25):
create another step function.
Having said that, AI will be able to help us
to run certain processes even better and more efficient, and
with one thing in mind, creating an absolute superior user experience.
So 76% of our service provider customers in Australia think
that automation software is what really can support AI integration.
(12:48):
We have had AI support in our portfolio for a
while already, um, but most importantly, we are embracing an
open architecture where
The good data that is being collected, billions of, you know,
data points every day can help the operator to make
better decisions, uh, by combining it with other data sources, like,
you know, where infrastructure projects happening, what demographics do you
(13:09):
have in the network, whether you have enterprises versus consumers
kind of connecting to the internet. That's where AI is
bringing massive amounts of data together, which one human wouldn't
have been able to do in the past.
I imagine that integrating uh AI applications into networks and
digital infrastructure is going to be very, very complicated. So
(13:32):
what are we going to see as the biggest obstacles
to AI growth, particularly in Australia?
So, integrating AI into any type of ecosystem is, is
a quite challenging endeavour. It starts by, you know, planning
how you want to use it, set up the right,
you know, regulatory environments within, you know, your domain, but
(13:56):
then it touches everything from operations, IT, the network, the
data centre, training your workforce. So it is an absolute complex.
Um, undertaking. So the way we look at it, providing
network solutions to our customers is that we help them.
Uh, to make network assets and data centre assets available
(14:20):
to the AI applications in a very simple manner. There
are two things. One, you want to have, of course,
enough capacity on the compute side so you can run
and scale your application, but you also need to get
that data to your end users. And it is important
and we have been embracing this for almost a decade
with our adaptive network vision, openness, scalability, and security, and
(14:42):
the way networks need to be architected.
And now that AI kind of becomes an autonomous entity
requesting resources from networks and from other parts of the ecosystem,
we cannot have a ticket being issued and somebody manually
responding to an AI request. You got to have networks
being available as an asset to be consumed through automated
(15:03):
interfaces and APIs.
Now second part to that question, uh, Vocus predominantly serving
the enterprise and government market for our enterprise and government customers,
what should they be looking to from their telcos if
they're seeking to seize on the opportunities of AI?
I think that's a great question as first enterprises need
(15:26):
to figure out how do they want to run their
AI ecosystem. As we know, there are 3 different distinct
things that an AI needs to do. You got to
train it.
You gotta
In fair with it, meaning that the trained models are
meeting real world data. And then the third thing is
you got to tune your AI and once you have
(15:47):
defined the use case and how and where you want
to run it.
It becomes essential that the right building blocks are put
in place and they are connected the right way. So
enterprises and governments have similar but also some very distinct,
you know, requirements around data sovereignty, you know, redundancy, accessibility,
and so we have seen in our survey that um
(16:10):
the core networks.
Are a key, um, not obstacle, but I will call
them an enabler in the future to allow enterprises and
government to run their applications. 28% think that the DCI
connectivity is a key element. And, um, again, it all
comes back to where does the data live? What do
the applications require. But one thing for sure, as we
(16:33):
all know,
Customer and user experience is important, so you will end
up with, you know, significant requirements on latency, on the
network reliability, but also on security.
I want to go back to your study again for
a moment, Jurgen, uh, you looked at what type of
cloud models were likely to be used to deliver AI applications. Uh,
(16:55):
what did you find? So, Australia has a pretty good
mix of requirements. Um, I would say a bit higher
on the private cloud than what we've seen globally. Let
me give you the numbers. So 44% of the respondents
think that they will run their AI applications in private cloud.
37% in the public cloud, something you buy from global
(17:16):
hyper scales or even, even a local, you know, cloud provider.
And then 19% think that a hybrid cloud is the
way to go. So, all in all, not surprising, but
what this tells you is that people are very concerned
about what happens to their data. And we're seeing that
in conversations with service providers when they, when they talk
about using their own data with AI as well as enterprises.
(17:39):
So it's key that the data stays contained, secure, available
to them at any time. Hence, private cloud is 44%
being a very, very
Key um uh response on learning from the survey. And
so why do you think there's strong support for private
cloud and public cloud models rather than hybrid? Let me
(18:00):
roll this up from the bottom. Why hybrid? Why would
you choose a hybrid model to begin with and not
go public versus or private? You usually choose a hybrid
model because we, you
You want the best from both worlds, right? You want
private cloud, to take care of your data serenity concerns.
You want to make sure everything is safe and under
your control, but you also want a public cloud because
(18:22):
it scales. It's flexible. It gives you kind of unlimited
capacity to run, to train, to interfere with your models.
But when you look at hybrid clouds,
You always need additional measures for compliancy. It creates complexity. So,
how do I ensure that my data centre job with
AI doesn't run outside Australia versus on my private cloud? And, so,
(18:47):
and especially for government applications, I think it's, it's very
important that there's a very strict and distinct, you know,
private versus public cloud policy, but also technical implementation in place.
Last question for you, what was the prevailing view in
your study about whether AI will create more jobs or
(19:08):
get rid of more jobs? Is it the best thing
ever or is it the apocalypse? All the elephants in
the room. Look, um, we go back to the industrial revolution.
You know, a lot of people lost their jobs when
automation came in, a lot of wealth was created. And so,
in my conversations with customers, the impact of AI on
jobs really comes up. Everybody focuses more on the efficiency,
(19:32):
the customer experience, um, but it's the elephant in the room.
So we deliberately used this survey to ask the question,
and it was confirmed that, you know, also our opinion
that AI will generate wealth and new jobs was confirmed.
So 66% of our service provider customers in Australia believe
that AI will have a net increase on job roles.
(19:56):
And that doesn't come as a surprise because AI should
not be seen as something that reduces your ops and
optimises your caps. No, it should be seen as a
revenue enabler, something that helps you to grow business, offer
new services to your customers.
And um as we go to the second part of
the question that we asked, which job roles do we
(20:17):
believe are mostly impacted, that was a bit of a
surprise for me. Firstly, customer service.
Yes, 27% thought that customer service is going to be impacted,
but also the C-suite executives with 21% are identified as
the most at risk roles. So look, looks like you're
not going to be talking to me next time, but
to an AI, CTO not required anymore. But, um, just kidding.
(20:41):
I think senior, senior jobs have, you know, a place
in the ecosystem because replacing experience by AI is going
to be very tricky.
Awesome. Well, I certainly hope that that prediction pans out
to be true. So let me now ask, if you
had one wish, uh, one request that you could make
to all business and government leaders, what would your wish
(21:04):
be and why? Right, um, I think I have two
different asks here for governments and enterprises and one common ask. So,
for governments, we, we are seeing around the globe.
A fantastic uptake and an understanding of governments that AI
is something that's gonna help them grow the GDP, bring,
(21:26):
you know, wealth to the country, and really become a
pillar of a digit digital, um, ecosystem, a digital society.
So I would ask the governments to continue supporting and
investing in the enterprises and infrastructures alike to amplify that movement.
But also I would ask that policies are being created
(21:47):
that keep us safe.
But that also allows for growth at the same time.
I know that's a difficult task, but we are seeing
a lot of governments do that very well. And if
the governments could also talk to their
Global partners in crime, it would be best if there
are cross-border rules as we are living in a global society.
And we shouldn't have governments create, you know, benefits for
(22:10):
one and, you know, penalising the other. Let's, you know,
look at this as a global problem and an opportunity
that we need to address. And for enterprises, number 2,
they shouldn't look at AI as something that creates only
efficiencies and, as I said, optimise Opex and CapEx, embrace
AI as an opportunity for new growth, new revenues.
The rest will fall. And then I'm going to ask
(22:31):
both of them.
To collaborate and partner, not just amongst governments and enterprises,
but enterprises and enterprises, enterprises and cloud providers. This is
an ecosystem play. And we can only thrive at its best,
and everybody can be a winner if we participate. And
I'm not saying open up the box of Pandora with
all the secrets that are shared across the AI community
(22:53):
or create meaningful partnerships.
Brilliant. Now we're gonna wrap up with a rapid fire
segment where I'm gonna throw a few questions at you.
I wanna hear back the first thing that jumps into
your head. So, Jurgen, what is your favourite piece of technology? Well,
I've got so many, but I would say my drone. Nice. Uh,
how do you disconnect?
(23:13):
Um, that's where offline is the key word. No phones.
Either off to the pub with my friends or off
into the mountains with my family. What's the most important
thing that you do for your well-being? Not doing enough,
but regular outdoor exercise that it does me very well.
And for my mental well-being, I play music.
Nice. What instruments do you play? Or instruments? I play clarinet.
(23:37):
Very nice. What's one thing that would surprise people about you?
So usually when I show up in a business environment,
having global discussions, people are very surprised that I'll live
in a small village in Upper Austria. What's the one
personal trait most important to success? Oh, that's easy. Passion.
Passion in everything.
I do. You won't find me very engaged if I'm
(23:58):
not passionate on a topic. Last one, what's the one
thing that there needs to be more of in business today?
I think in, in telco specifically, we need more young
talent that joins our industry, both on the, you know,
equipment vendor side, but also in the service provider, Telco.
We better need, we need help to manoeuvre the changing
needs of the consumers and the young businesses alike. And, um,
(24:20):
sorry for giving you a longer answer here, but I've
just added too early in career to my team, we
are making a difference and which are confirming that we
need the young energy, maybe not even with a technical background.
We need to go. Jurgen Hatay CTO International from Sienna,
it has been an absolute pleasure having you with us
here on the Vocus Inspire podcast. Thanks so much for
(24:42):
your time. Thank you, Luke. It was a great conversation.
Looking forward to the next one.
Thanks so much for listening. I hope you've enjoyed this
episode of Focus Inspire, and we look forward to bringing
you more inspiration in coming episodes.
Speaker 1 (24:56):
And don't forget, if you want more inspiration and more episodes,
head to Vocus.com.au/podcast. You can follow us on LinkedIn and
Twitter to stay up to date with all things Vocus.
Listen out for the next episode of the Vocus Inspire podcast.
Welcome to Vocus Inspire, the podcast full of brilliant ideas
for business.
Speaker 2 (00:10):
Hi, I'm Luke Coleman, head of government and corporate affairs
at Vocus, Australia's leading specialist fibre and network solutions provider.
Before we get things underway, we want to acknowledge and
pay our respects to the traditional custodians of the land
from wherever you're listening. In this podcast, we dive headfirst
into what's on the minds of Australian business and government
(00:30):
leaders to help inspire you and your organisation to go forward,
go further and go faster. So let's go.
Hello and welcome to the Vocus Inspire podcast. Today we're
returning to one of our favourite topics, AI, but this
time from a different angle. We're going to look at
(00:51):
the impacts of AI on network operations and infrastructure, with
none other than Juergen Hattaya, CTO International from Sienna. Juergen
brings more than 20 years of experience in telecommunications software.
Hardware and network operations, and he's joining us to share
some insights from Sienna's global study of telecom and IT
(01:15):
engineers about AI and the network. Welcome to the podcast, Jurgen.
Thank you, Luke. I'm glad to be here. It's great
to have you with us. So, start off, there is
so much hype around AI at the moment, you know,
the Gartner hype cycle is in full swing. So tell
me to start off, what excitement.
you most about AI and what it might deliver. Well, that's,
(01:36):
that's a nice icebreaker, Luke. And, um, I got to
be careful not to take the entire podcast with question one,
because I'm truly excited on what's happening. So, I'm a,
I'm a big picture guy, right? And, uh, when I
look at AI, I really see, uh, digital revolution happening here.
Not only one that gives us new technology, but one
that will create wealth, disrupt existing systems and processes. But
(01:58):
most important,
Only, it's gonna give us tech that improves our life,
various aspects of life. Be it, you know, at home, where,
you know, we use AI to check our kids' homework,
which we don't understand anymore. Simplifying daily routines and automate things.
But also in the workplace, I think we have only
seen the beginning of how AI can really help us
to make a difference and maybe get some time back. Um,
(02:19):
but lastly, I want to mention that, you know, the
impact that we see, especially in the medical space.
Is something that truly will touch us, you know, be
it young or old, uh, you know, be it poor
or rich, I think this will really help. AI will
help us to get, you know, better care for all
of us globally. Fantastic. Well, let's dive into Sienna's study.
(02:40):
I'm really interested to hear, uh, about what AI is
expected to do in terms of increasing data on.
Works. A lot of the listeners to this podcast are
going to work in the telecommunications industry. It's something that
I think we are all, uh, wondering about, what is
the impact of AI on our network. So what did
you find in that study and what is driving what
is expected to be a significant increase in network capacity,
(03:04):
and then I guess what challenges is that going to
present for telcos?
You know, it's really the number one question that I'm
discussing with all of our customers right now. And I
got to tell you up front, even though we conducted
a study, I don't have a crystal ball or silver
bullet to offer today to answer that question. But there
are a few things we know, right? We know that
the big investment cycle in data centres is a very
(03:26):
good leading indicator for what's, what's happening to connectivity later on,
be it in data centre interconnect or even
Access networks. So while we are talking to a lot
of our customers on a daily basis, we have conducted
this study to get a broader view on the market,
an opinion, an educated opinion from the experts. So, um,
this large-scale assessment really has helped us to understand where
(03:49):
people do expect the traffic to increase. And we have
seen 29% of our service provider customers in Australia tell
us that, um, traffic.
Between the data centres is gonna grow significantly, but also
on the edge. And um taking another number here, 91%
of the service providers expected AI to increase traffic.
(04:10):
By more than 10% on top of the natural traffic growth.
So really, that growth is gonna be driven largely by
the adoption of AI, be it in the end user
space or in the enterprises. And, um, we have also,
you know, looked at, you know, what type of traffic
is there. So, I don't know if you're familiar with
the so-called multimodal AIs, which are combining text, video, uh,
(04:34):
as well.
speech to have a complete immersive experience when you communicate
with AI. And that's gonna be driving, you know, significantly
new network requirements, not only bandwidth growth on top of that. So, again, 42%
of core networks will absolutely require, uh, upgrades according to
that study, as well as 28% of the data centre interconnect.
(04:55):
So the big pipes that are connecting the compute hubs
with each other. And, um,
That's really where we focus as CN on to, you know,
bring innovation, simplification, efficiencies to enable our service provider customers
and telcos to build new services and build new revenues.
Jurgen, I'm guessing that not all industries are going to
(05:16):
be impacted in the same way initially by AI. So
tell me, what are some of the key industries uh
where you're expecting AI is going to drive the biggest
increases in data? We absolutely believe that, you know, uh,
the leading industries in adopting digitalization and automation will also
(05:36):
lead the charge in in uh adopting AI.
Um, our study has, however, surprised us because we have seen, uh,
our respondents telling us they expect the financial services to
lead the charge. Whereas previously, we have seen media and
entertainment kind of being the big drivers for new connectivity
requirements for higher bandwidth, bigger speeds in the past. That
(05:58):
is surprising because, you know, when you look at all
of the main drivers of network capacity in recent years,
it's huge amounts of
Uh, a video or massive game downloads that particularly at
the consumer level, uh, blow out data and capacity requirements. So,
what is it about financial services that is going to
(06:19):
lead to such high volumes of data? Have you got
any kind of real world examples of, of what's happening
in the finance sector? I, I do, but I also
had to unpack this a little bit for myself because
I didn't expect that a couple of million or even
billion lines of transactions are going.
Cause all this extra traffic on the network. But, um, 55%
of our, uh, survey respondents do believe that, you know,
(06:41):
there is that significant decrease. And as we unpack those
use cases, clearly, it's not only about the transaction, right?
But it's about the deep analytics that you apply to,
you know, those customer interactions in the financial system. So
it's understanding trends, doing risk assessments, checking for regulatory compliance.
But there is also one use case which has used
(07:03):
AI for a couple of years already, and that's fraud detection.
I think we all have been exposed to one or
the other level of fraud, and it becomes vital that
AI's are being used to detect those as the adversaries
will also be using AI to find new holes, um,
in the financial industry to break in.
(07:23):
But like every other industry, I believe there is one
aspect where AI will absolutely generate new and more traffic
and that when it comes to customer services and customer interaction.
Everybody knows that be on the telco side, financial services,
health services, customer experience is key, how you serve your customers.
(07:44):
And by using, especially generative AI technologies to have better interaction,
be it on voice or video with your customers, you
will be driving significant amount of data through the network,
in the access, in the edge, and, uh, roll that
into your financial decision process. So, I would say absolutely,
financial industry has always been very innovative in adopting these
(08:04):
new technologies.
And hence, um, you know, surprised on the one hand,
but not surprised on the other hand to see that
they come up as one of the leading, uh, industries
in adopting AI and putting traffic on the network.
So if we're expecting to see these significant increases in
network traffic, then when you're talking to your telco customers,
(08:25):
no surprise, it's gonna be a hot top talking, uh,
hot topic, I should say, talking about how they're going
to upgrade their networks. So tell me, Jurgen, what kind
of investments are you expecting to see from telcos and
what should organisations be looking for for how they're going
to support their AI integration?
That's a fantastic question. And, um, firstly, in conversations with
(08:47):
our customers, people are still a bit hesitant to make
large scale investments into certain domains, because AI really hasn't
hit the network yet. So you don't know if you're
gonna see a lot of training traffic in the core.
You're gonna see a lot of inference traffic on the edge,
but our customers are readying themselves with network architectures and
concepts to really support the growth to come. So people
(09:11):
do expect that
We will need to invest into road and technology, so
the underlying optical network. Actually, 47% of Australian operators do
believe that they will need to upgrade those networks. Other,
another 44% think that the upgrade of the routing and
switching infrastructure on top of that will be a key challenge.
But more than anything, 98% of all respondents to our
(09:34):
survey said that they absolutely need to upgrade the fibre network.
And the fibre network, you know, has become, you know,
a lifeline, the arteries of, of our telecommunication globally. And
so organ
look at the fibre network to really address the significant
growth of bandwidth, low latency requirements, but most importantly, fibre
(09:55):
is very reliable. So you don't have any active components
in the line of communication and hence, this will be
The, the, the media of choice. So, but networks is
really not where it stops. I, I look at our
customers and they're really reinventing themselves in that inflexion of
AI hitting the networks. So they are thinking not only
(10:17):
about upgrading network connectivity,
But also upgrading the services portfolio that they're offering to
their end users. So some folks might think, hey, yes,
I need to offer a pipe to connect my enterprise
to the cloud, but the enterprises have very distinct requirements,
which may need some on-site or on the edge compute.
And edge computing has been in, you know, in discussion
(10:39):
for the last decade.
But now, I believe in our customers believe that we
are on the brink of, you know, investing in the edge,
to really bringing that compute closer to the end user.
Now when you were talking earlier about the finance sector,
you were talking about generating a lot of data, analysing, uh,
transactions and that sort of thing. And when it comes
(11:00):
to networks, there is also a lot of attention on
network analysis software. So what can you tell us about this?
Why is it so important in this new AI environment?
So we have been using software to optimise and analyse
and configure and troubleshoot our networks for, since the inception of,
of communications and
(11:21):
It's also not new news that AI has been an
important part of the network optimisation and analytics for many
years already. And, uh, our customers have been doing a
fantastic job on running the networks very efficient, very reliable
over many years. I mean, uh, looking at networking, this
is a utility. It is the backbone of many of our,
(11:42):
you know, financial transactions, of our communication. So if our
folks would have done a bad job, then, you know,
we wouldn't be where we are today.
Um, a reporter asked me earlier this week, do you
think that, you know, running networks more efficient running networks, um,
you know, AI support will allow you to offset.
(12:02):
What AI is going to put on the network in
terms of additional traffic. And I, I was, I was
just smiling and laughing. I said, do you think the
networks are being run so poorly today that you will,
you know, need an AI to help you run those?
I don't think so. We might be able to squeeze
out the one or the other percent of additional capacity or,
or bandwidth from the existing assets, but it will not
(12:25):
create another step function.
Having said that, AI will be able to help us
to run certain processes even better and more efficient, and
with one thing in mind, creating an absolute superior user experience.
So 76% of our service provider customers in Australia think
that automation software is what really can support AI integration.
(12:48):
We have had AI support in our portfolio for a
while already, um, but most importantly, we are embracing an
open architecture where
The good data that is being collected, billions of, you know,
data points every day can help the operator to make
better decisions, uh, by combining it with other data sources, like,
you know, where infrastructure projects happening, what demographics do you
(13:09):
have in the network, whether you have enterprises versus consumers
kind of connecting to the internet. That's where AI is
bringing massive amounts of data together, which one human wouldn't
have been able to do in the past.
I imagine that integrating uh AI applications into networks and
digital infrastructure is going to be very, very complicated. So
(13:32):
what are we going to see as the biggest obstacles
to AI growth, particularly in Australia?
So, integrating AI into any type of ecosystem is, is
a quite challenging endeavour. It starts by, you know, planning
how you want to use it, set up the right,
you know, regulatory environments within, you know, your domain, but
(13:56):
then it touches everything from operations, IT, the network, the
data centre, training your workforce. So it is an absolute complex.
Um, undertaking. So the way we look at it, providing
network solutions to our customers is that we help them.
Uh, to make network assets and data centre assets available
(14:20):
to the AI applications in a very simple manner. There
are two things. One, you want to have, of course,
enough capacity on the compute side so you can run
and scale your application, but you also need to get
that data to your end users. And it is important
and we have been embracing this for almost a decade
with our adaptive network vision, openness, scalability, and security, and
(14:42):
the way networks need to be architected.
And now that AI kind of becomes an autonomous entity
requesting resources from networks and from other parts of the ecosystem,
we cannot have a ticket being issued and somebody manually
responding to an AI request. You got to have networks
being available as an asset to be consumed through automated
(15:03):
interfaces and APIs.
Now second part to that question, uh, Vocus predominantly serving
the enterprise and government market for our enterprise and government customers,
what should they be looking to from their telcos if
they're seeking to seize on the opportunities of AI?
I think that's a great question as first enterprises need
(15:26):
to figure out how do they want to run their
AI ecosystem. As we know, there are 3 different distinct
things that an AI needs to do. You got to
train it.
You gotta
In fair with it, meaning that the trained models are
meeting real world data. And then the third thing is
you got to tune your AI and once you have
(15:47):
defined the use case and how and where you want
to run it.
It becomes essential that the right building blocks are put
in place and they are connected the right way. So
enterprises and governments have similar but also some very distinct,
you know, requirements around data sovereignty, you know, redundancy, accessibility,
and so we have seen in our survey that um
(16:10):
the core networks.
Are a key, um, not obstacle, but I will call
them an enabler in the future to allow enterprises and
government to run their applications. 28% think that the DCI
connectivity is a key element. And, um, again, it all
comes back to where does the data live? What do
the applications require. But one thing for sure, as we
(16:33):
all know,
Customer and user experience is important, so you will end
up with, you know, significant requirements on latency, on the
network reliability, but also on security.
I want to go back to your study again for
a moment, Jurgen, uh, you looked at what type of
cloud models were likely to be used to deliver AI applications. Uh,
(16:55):
what did you find? So, Australia has a pretty good
mix of requirements. Um, I would say a bit higher
on the private cloud than what we've seen globally. Let
me give you the numbers. So 44% of the respondents
think that they will run their AI applications in private cloud.
37% in the public cloud, something you buy from global
(17:16):
hyper scales or even, even a local, you know, cloud provider.
And then 19% think that a hybrid cloud is the
way to go. So, all in all, not surprising, but
what this tells you is that people are very concerned
about what happens to their data. And we're seeing that
in conversations with service providers when they, when they talk
about using their own data with AI as well as enterprises.
(17:39):
So it's key that the data stays contained, secure, available
to them at any time. Hence, private cloud is 44%
being a very, very
Key um uh response on learning from the survey. And
so why do you think there's strong support for private
cloud and public cloud models rather than hybrid? Let me
(18:00):
roll this up from the bottom. Why hybrid? Why would
you choose a hybrid model to begin with and not
go public versus or private? You usually choose a hybrid
model because we, you
You want the best from both worlds, right? You want
private cloud, to take care of your data serenity concerns.
You want to make sure everything is safe and under
your control, but you also want a public cloud because
(18:22):
it scales. It's flexible. It gives you kind of unlimited
capacity to run, to train, to interfere with your models.
But when you look at hybrid clouds,
You always need additional measures for compliancy. It creates complexity. So,
how do I ensure that my data centre job with
AI doesn't run outside Australia versus on my private cloud? And, so,
(18:47):
and especially for government applications, I think it's, it's very
important that there's a very strict and distinct, you know,
private versus public cloud policy, but also technical implementation in place.
Last question for you, what was the prevailing view in
your study about whether AI will create more jobs or
(19:08):
get rid of more jobs? Is it the best thing
ever or is it the apocalypse? All the elephants in
the room. Look, um, we go back to the industrial revolution.
You know, a lot of people lost their jobs when
automation came in, a lot of wealth was created. And so,
in my conversations with customers, the impact of AI on
jobs really comes up. Everybody focuses more on the efficiency,
(19:32):
the customer experience, um, but it's the elephant in the room.
So we deliberately used this survey to ask the question,
and it was confirmed that, you know, also our opinion
that AI will generate wealth and new jobs was confirmed.
So 66% of our service provider customers in Australia believe
that AI will have a net increase on job roles.
(19:56):
And that doesn't come as a surprise because AI should
not be seen as something that reduces your ops and
optimises your caps. No, it should be seen as a
revenue enabler, something that helps you to grow business, offer
new services to your customers.
And um as we go to the second part of
the question that we asked, which job roles do we
(20:17):
believe are mostly impacted, that was a bit of a
surprise for me. Firstly, customer service.
Yes, 27% thought that customer service is going to be impacted,
but also the C-suite executives with 21% are identified as
the most at risk roles. So look, looks like you're
not going to be talking to me next time, but
to an AI, CTO not required anymore. But, um, just kidding.
(20:41):
I think senior, senior jobs have, you know, a place
in the ecosystem because replacing experience by AI is going
to be very tricky.
Awesome. Well, I certainly hope that that prediction pans out
to be true. So let me now ask, if you
had one wish, uh, one request that you could make
to all business and government leaders, what would your wish
(21:04):
be and why? Right, um, I think I have two
different asks here for governments and enterprises and one common ask. So,
for governments, we, we are seeing around the globe.
A fantastic uptake and an understanding of governments that AI
is something that's gonna help them grow the GDP, bring,
(21:26):
you know, wealth to the country, and really become a
pillar of a digit digital, um, ecosystem, a digital society.
So I would ask the governments to continue supporting and
investing in the enterprises and infrastructures alike to amplify that movement.
But also I would ask that policies are being created
(21:47):
that keep us safe.
But that also allows for growth at the same time.
I know that's a difficult task, but we are seeing
a lot of governments do that very well. And if
the governments could also talk to their
Global partners in crime, it would be best if there
are cross-border rules as we are living in a global society.
And we shouldn't have governments create, you know, benefits for
(22:10):
one and, you know, penalising the other. Let's, you know,
look at this as a global problem and an opportunity
that we need to address. And for enterprises, number 2,
they shouldn't look at AI as something that creates only
efficiencies and, as I said, optimise Opex and CapEx, embrace
AI as an opportunity for new growth, new revenues.
The rest will fall. And then I'm going to ask
(22:31):
both of them.
To collaborate and partner, not just amongst governments and enterprises,
but enterprises and enterprises, enterprises and cloud providers. This is
an ecosystem play. And we can only thrive at its best,
and everybody can be a winner if we participate. And
I'm not saying open up the box of Pandora with
all the secrets that are shared across the AI community
(22:53):
or create meaningful partnerships.
Brilliant. Now we're gonna wrap up with a rapid fire
segment where I'm gonna throw a few questions at you.
I wanna hear back the first thing that jumps into
your head. So, Jurgen, what is your favourite piece of technology? Well,
I've got so many, but I would say my drone. Nice. Uh,
how do you disconnect?
(23:13):
Um, that's where offline is the key word. No phones.
Either off to the pub with my friends or off
into the mountains with my family. What's the most important
thing that you do for your well-being? Not doing enough,
but regular outdoor exercise that it does me very well.
And for my mental well-being, I play music.
Nice. What instruments do you play? Or instruments? I play clarinet.
(23:37):
Very nice. What's one thing that would surprise people about you?
So usually when I show up in a business environment,
having global discussions, people are very surprised that I'll live
in a small village in Upper Austria. What's the one
personal trait most important to success? Oh, that's easy. Passion.
Passion in everything.
I do. You won't find me very engaged if I'm
(23:58):
not passionate on a topic. Last one, what's the one
thing that there needs to be more of in business today?
I think in, in telco specifically, we need more young
talent that joins our industry, both on the, you know,
equipment vendor side, but also in the service provider, Telco.
We better need, we need help to manoeuvre the changing
needs of the consumers and the young businesses alike. And, um,
(24:20):
sorry for giving you a longer answer here, but I've
just added too early in career to my team, we
are making a difference and which are confirming that we
need the young energy, maybe not even with a technical background.
We need to go. Jurgen Hatay CTO International from Sienna,
it has been an absolute pleasure having you with us
here on the Vocus Inspire podcast. Thanks so much for
(24:42):
your time. Thank you, Luke. It was a great conversation.
Looking forward to the next one.
Thanks so much for listening. I hope you've enjoyed this
episode of Focus Inspire, and we look forward to bringing
you more inspiration in coming episodes.
Speaker 1 (24:56):
And don't forget, if you want more inspiration and more episodes,
head to Vocus.com.au/podcast. You can follow us on LinkedIn and
Twitter to stay up to date with all things Vocus.
Listen out for the next episode of the Vocus Inspire podcast.
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