Sanjay Nayak, Pacnet: A fundamental shift

25 February 2014 | Guy Matthews


Sanjay Nayak says Pacnet wants to bring harmony and consistency to Asia’s market for Carrier Ethernet. Guy Matthews interviews an evangelist and strategiser.



Sanjay Nayak is learning to play the guitar. He says, modestly, that the hobby is in its very early days. But he hopes that by sticking with it, he can improve and mature over time.

By day, as VP of product strategy and management with network operator Pacnet, he is playing his part in the improvement and refinement of a quite different work in progress – Asia’s market for Carrier Ethernet services.

Based out of Singapore, Nayak’s role is to develop Pacnet’s offer for carrier and enterprise customers and drive development of products in areas like managed network services, data centre expansion and cloud computing.

He sees Carrier Ethernet as an ideal enabler for all these service areas, but acknowledges that adoption in Asia has been slower than in the developed telecoms markets of the west, and that its density across the region remains patchy. That is not to say that there are no hotspots.

“I’d say the highest density of Ethernet services in Asia is to be found in Hong Kong, Singapore, Australia, Japan, South Korea and Taiwan,” Nayak says. “Growth markets in the next wave include the Philippines, India, Indonesia and Vietnam.”

China, he says, follows the beat of a somewhat different drum.

“It’s a significant opportunity, but the economics relating to Carrier Ethernet services in China are still a challenge compared to the more mature market for MPLS services for private networking.”

Nayak has identified what he believes to be a fundamental pan-Asian shift in attitude to Carrier Ethernet that could drive the next wave of its adoption.

He believes that this new-found enthusiasm is being driven in large part by the region’s growing reliance on cloud-based applications and services.

“At the level of enterprises and their cloud service providers, it has been common until recently to use the public internet to deliver services,” he notes. “Now some of the larger enterprises are looking to build multiple cloud platforms across different geographical areas and wanting to interconnect those, and the internet is not helping with that.”

Private lines
Those with the resources have established private line connectivity, either over SDH or Layer 3 MPLS. Increasingly, says Nayak, they are realising that Carrier Ethernet has the flexible properties to do the job more easily and cost-effectively. They are turning in droves to E-LAN services as defined by the Metro Ethernet Forum (MEF).

“This shift in perspective is more notable from the point of view of the cloud service provider than the enterprise,” he remarks. “Enterprise thinking is moving slower, with many still preferring a Layer 3 solution, where they have skills and existing relationships with service providers.”

This evolution poses a challenge for carriers like Pacnet, he says. They must take the basic Carrier Ethernet platform and give it attributes needed by cloud computing.

To deliver what is really wanted, they must go further, however. They must take the concept of what can be done in the confines of one network in one country, and turn that into a true wide-area Carrier Ethernet-based network that spans multiple geographies.

Nayak says that Pacnet has plans to answer this need with an industry first – an integrated SDN-based architecture that will allow customers to subscribe to international Ethernet services on demand, on a “pay for what you use” basis.

“We will launch this in Q1 2014 and I believe it will further increase adoption of Ethernet services across the region,” he says.

The challenge of delivering a seamless on-demand service across Asia – one that puts customers in control of the services they consume – is not the same as achieving the same feat in the US, suggests Nayak.

“Asia has differences to the US and Europe,” he says. “It has a multitude of regulatory environments and many different countries at different stages of development. This makes providing a service-on-demand that is truly reliable a challenge, but we can do this by leveraging our strengths. For example, we own one of the largest subsea cable networks in Asia. To dynamically add fresh capacity to a network is easier for us than for a member of a large consortium.”

To add the virtual functionality that is needed to make this sort of solution work, and to build in maximum resilience, Pacnet has worked closely with several leading vendor names. At the core of its network is Infinera equipment, with Cisco and Alcatel-Lucent running on top of that.

“We are tying together the SDN side with OpenFlow to work across the whole region,” says Nayak. “We’re leading in Asia in this area, although others are working on something similar. SDN with high scalability and resilience is something we are doing today.”

He believes that most carriers talking about adopting SDN are doing it to drive internal improvements.

“We’re using it instead to give real control to our customers, and deliver that for them across the whole region we serve,” he claims.

Shifting requirements
Ethernet is an exciting prospect for Asian telecoms in a number of senses, says Nayak. Not least of these is the steady and reliable solution it presents in the face of customer needs that are changing rapidly.

“We’re seeing changing demand in our customer base, different according to segment, whether that’s software customers, content delivery ones or service providers,” he observes. “That’s coming up from the level of the consumer, the wider adoption of the Internet and from mobile data. There’s now such a big information requirement – the profile of people’s requirements has changed significantly.”

He says it is a core strength of Carrier Ethernet that it permits the cutting of the capacity cake in gradations to suit all needs.

“There are customers taking 10G, 40G or 100G wavelengths from us and putting their own services on top of that,” he says. “Then there are those that are MPLS users who are asking what we can offer them. All these customers want more control, and V-LAN transparency. The whole nature of the conversation is changing.”

He is excited that Carrier Ethernet is itself changing to match shifting requirements and escalating expectations, in particular the possibilities offered by CE 2.0.

“With 2.0, we’ve all come a long way compared with the previous version of Carrier Ethernet,” he enthuses. “There are depths and added consistencies to the new standard. It’s a huge improvement. We’re currently in talks with the MEF about becoming certified, and are some way down that path. The more service providers out there who are certified in Carrier Ethernet 2.0, the easier interconnection will be for all. There is an argument for fast-tracking here.”

The best aspect of CE 2.0 from Pacnet’s viewpoint, he says, is that it can focus its own infrastructure development in its home territory of Asia without any compromise on connectivity with other markets.

“If you look at our strengths, they are here in Asia,” he says. “We’re not going to go building Carrier Ethernet all over Europe. That’s not where our future is going to lie. But our customers in Asia certainly want to move traffic to Europe, just as our customers in the US want to connect to Asia. By making CE 2.0 connections in those places, we are working better for those customers.”

Just in the past month, Pacnet has established a new foothold in the US market by establishing an E-NNI agreement with newly CE 2.0-certified TW Telecom. By tapping into TW’s “One to Many” E-Access network service, Pacnet can provide US customers with easy and quick connections to locations throughout the Asia-Pacific region, including China, India and Australia.

In Europe, Pacnet has a new customer in the form of Virtus Data Centres. Pacnet is to provide the link between facilities in London and the Asia-Pacific region, giving Virtus customers access to a fibre-optic network that spans 13 Asian countries and 46,420km of submarine cable systems.

Intra-Asian Ethernet connectivity is also something that Pacnet has been at work on, says Nayak. It has recently enhanced its PoPs in Bangalore, Mumbai, Chennai, and New Delhi, enabling the delivery of its full suite of connectivity solutions to Indian carrier customers.

Nayak says that Pacnet has noted rising demand in India for links with a variety of Asia-Pacific destinations, and corresponding increased requirements among US, European and Asia-Pacific customers seeking connectivity with key locations in India. Pacnet has new Master Service Agreements with each of China’s major operators – China Telecom, China Unicom, and China Mobile – all linked to moves to improve internet connectivity.

So where does Nayak want Pacnet to go next with its Carrier Ethernet product strategy? The answer seems to lie in consolidating existing efforts, rather than plunging headlong into new areas.

“We just want to make sure we are increasing customer satisfaction,” he concludes. “We want to figure out how to use Ethernet to meet customer requirements in various parts of the world.”


Sanjay Nayak

As VP of product strategy and management at Pacnet, Sanjay Nayak’s main focus is overseeing the company’s offer for carriers and enterprises, and driving development of products in areas like managed network services, data centre expansion and cloud computing services.

He has over 10 years of experience in the telecoms industry. Prior to his current role, he was director of business development with Pacnet, and before joining that organisation, Nayak held senior development roles with Verizon Business and C&W in Australia.

Nayak holds an MBA from the University of Technology in Sydney, and a BCOM in Commerce from Symbiosis International University. He likes to spend as much time as he can out of work with his family, and has two young sons.