ANALYSIS: Apple to enter network infrastructure game?

02 July 2015 |


US technology giant Apple may be looking to join the telecoms infrastructure game with news that it is considering the roll-out of its own high-speed content delivery network.

Traditionally, Apple has relied on network providers and technology suppliers to support its consumer content services, but the company is now looking to bolster its own infrastructure and provide the service in-house.

The new infrastructure is seen by many as a push to better compete with the likes of Amazon, Google and Microsoft; from which Apple rents server space.

“User experience is very important to Apple, but delivery of its content is the one part of that experience it doesn’t control,” said Andrew Schmitt, analyst at IHS Infonetics.

“If they want to control and maximise that user experience, they’re going to have to control that last piece.”

Many in the industry are in agreement that Apple needs to increase its infrastructure in order to grow alongside demand.

“Apple has slowly built out its data centres in the past five years,” said Tavis McCourt, an analyst at Raymond James Financial.

“As they serve up more things from the cloud to more and more customers, they’re going to need to scale up.”

Upgrading its data centres forms a big part of Apple’s infrastructure drive, and in February this year, the company revealed plans to spend €1.7 billion on two data centres in Europe, powered by 100% renewable energy.

Apple is now said to be laying out plans to connect its data centres in California, Nevada, North Carolina and Oregon – amongst others – via long-haul pipes to get content closer to internet hubs in densely populated markets.

From there, content would be delivered to customers via broadband connections and mobile towers owned by cablecos and telcos. And doing so will enable Apple to handle more traffic on its own.

The firm launched a subscription streaming music service to compete with the likes of Spotify on June 30, named Apple Music, and with more consumer services in the pipeline, it will be critical for the company to provide faster, more efficientm glitch-free delivery.

Sources have claimed that Apple also plans to focus on newer technologies to execute its high-speed content delivery network, and although the company is yet to confirm financials, market watchers expect investment to hit the billions.

The infrastructure plans have not yet been publically discussed, and Apple did not respond when asked for comment.