At the point of convergence
Ricky Chau, CBC Tech’s chief strategy officer, speaks to Natalie Bannerman about why software is at the heart of the company’s evolution
Six months into his role as CBC Tech’s chief strategy officer, Ricky Chau has already ushered in a number of milestones. In May, he oversaw CBC Tech joining the ITW Global Leaders Forum as a community member, acting as the company’s official representative. April saw the company expand its SD-WAN fabric, eNet Connect, by 15 to 20, in new markets across Asia-Pacific, Europe and the United States.
Then in September, the company completed its transformation from China Broadband Communications to CBC Tech, to ensure its brand lines up with its vision to become “the next-gen network-as-a-service provider”.
At the time of its rebranding, Richard Fung, CBC Tech’s co-founder and chief executive, said: “Rebranding CBC into ‘CBC Tech’ aims to revitalise our vision, mission and company culture, enabling us to execute our innovation roadmap to converge telecom and tech. We’re committed to the transformation through the investments in our people, technology and process.”
Most recently, the company became the latest member of the Pacific Telecommunications Council, a move that CBC Tech said would help it “stay abreast of the international frontier, better integrate the advantages of telecommunications and technology, and accelerate the transformation from a telecommunications service provider to a network-as-a-service provider”.
Chau, who was previously Lumen Technologies’ vice president of enterprise business Asia Pacific and Japan, says that since joining CBC Tech his work has focused on ensuring his company can “execute that vision”.
For Chau, ensuring CBC Tech meet this goal involves converging its telecoms services with new technology to power it. Part of this involves building a vertical ecosystem through forming partnerships.
“The other piece is how do we build our ecosystem,” says Chau. “We build our ecosystem horizontally to expand our geographical footprint through partnerships. But when you think about a tech ecosystem, you’ve got to think about how to do that vertically, to partner with SD-WAN, cloud/edge, security and application providers to expand your capabilities.”
The hard and the soft
Chau says that while infrastructure remains CBC Tech’s DNA, its future growth is in its software layer, so it must combine both. This is what led to its decision to expand its SD-WAN fabric.
“CBC Tech is not an infrastructure-heavy company – our SD-WAN fabrics will continue to be our focus,” he says. “There are certain geographies where we’ll continue to build physical networks, and certain geographies where we’ll partner to expand our footprint.”
While CBC’s assets include those from its background as a traditional network provider, such as VPN and IP networks, Chau says the company has “upped the value chain to include our overlay, which is the SD-WAN fabrics”.
Chau says the decision to rebrand the company to CBC Tech from China Broadband Communications, in order to align with being network-as-a-service (NaaS) provider rather than a pure infrastructure player, came about for a few reasons.
“If you look at Asia-Pacific, or China specifically, it’s fairly difficult to own the in-country fibre infrastructure. And even across other parts of Asia, telecommunications is still highly regulated,” he explains. “So we were clear from day one that while we have that Layer 2 and Layer 3 network, there’s no way for us to own the underlying infrastructure, so we have to be a service company.”
Combining an overlay and an underlay network, by placing SD-WAN and SASE software products atop its IP and VPN networks, has given CBC Tech a certain amount of control and management over its offering. Although it does not deliver a completely end-to-end service, it provides the core where control resides, which is key for enterprise networks moving to internet-based connectivity.
Chau, who was a speaker at a workshop on the convergence of telco and techco services held during Capacity Europe in mid-October, expanded on this evolution and why so many telcos, like CBC, want to make the distinction.
“We’ve so many buzzwords in our industry, especially over the last seven to eight years, whether that’s ‘managed services’, ‘NFV’, ‘cloud’, ‘edge compute’, but at the end of the day you need to really understand what your customers need,” he says. “For us, our customers are enterprises and global service providers. So when we look at moving from a telco to a techco, we observe it from two perspectives to serve their requirements.”
The first such lens, he says, is improving customer experience. This requires examining the customer’s journey through the whole value chain, from the buying experience to ordering, delivery and support.
“Even though we’re a relatively young company, we don’t have many legacy systems and processes in the same way as the incumbents do,” says Chau. “The B2B customers of today want an experience similar to consumer e-commerce, with that digital buying and support experience, and I don’t think the industry is there yet.”
To Chau, CBC Tech’s transformation is underpinned by three key pillars: innovating processes, underpinned with technology, delivered by people. But he recognises that the ongoing competition for talent and the market-wide skills deficit means human resources are a sticking point for many players in the space.
“We’ve a talent shortage in the telecom and tech industry in general,” he says. “There are a few things we’re doing, including upskilling our employees. We’re changing our image to be a tech company, which we hope will attract good talent. Traditionally, we hire people from the telecoms industry, but we’ve changed the hiring profiles because the skillset required is different.”
Chau also believes that as the global talent pool is so limited, the industry should start recruiting people with less experience in the space, and start them off in junior roles and nurture them as they progress. He adds that retaining and upskilling talent is just as important as finding new blood.
“We’re trying to change our businesses and our service,” he says, “so we need different skill sets from our team across different functions.”
At the same time, enterprise workloads are continuing to move to public clouds operating on a software-as-a-service (SaaS) basis, not on-prem and that, according to Chau, “traditional private network cannot solve this problem”.
“They’re looking for a more open network, like SD-WAN. But the other thing we’ve seen since the pandemic is that employees no longer work entirely from the office anymore. All this change is accelerating the enterprise to look at a different ICT structures,” he says.
Security remains a top priority as more applications being run over the internet. Chau says that CBC Tech has opted a partnership approach, as “when it comes to security, our strategy is to integrate the SASE into our SD-WAN fabrics”.
The first part of this process has seen CBC Tech partner with a select number of companies which have integrated their products with CBC’s services. The second part involves CBC Tech’s being based in China, which means security does not only involve hardware, but also ensuring that security vendors and providers have access in order to offer their services.
An example of this approach is CBC Tech’s collaboration with zScaler, an IT security company, which led to the development of China Premium Access, a secure connectivity solution for users in China that uses a simplified NaaS-delivered solution. Now, instead of having to deploy a data centre, Zscaler customers can forward traffic to their company’s premium data centre using Client Connector, Cloud Connector or IPSEC/GRE tunnels from their branches – a kind of fast track to the market.
Of all the emerging technologies being spoken about across the industry, Chau says the one most relevant to CBC Tech is 5G.
“We’ve been deploying 4G globally for quite some time now and we launched 5G backup in China - it is really critical for us,” says Chau. “We haven’t yet seen a perfect last-mile 5G, because the technology isn’t there yet.”
AI and machine learning also hold promise for Chau, as they will enable further automation, especially when it comes to outages and fault management.
Building on the momentum of the last six months, Chau says that CBC Tech will dedicate the next year to expanding its SD-WAN offering to a total of 50 emerging markets.
“We choose to do emerging markets one, from a demand perspective, and two, because it really differentiates us from the competition,” he says.
For Chau, CBC Tech’s transformation to focus on offering SD-WAN service comes down to its intention to leverage technology to provide a better user experience.
“If you’re a network provider, they tend to talk about the network metrics such as latency, packet loss or jitter. But when we talk to CIOs of enterprises, they’re more concerned the performance of their mission-critical applications,” says Chau. “It’s a very different ballgame.”
Whatever is next for this company as it develops, we’ll be watching.