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A recent survey conducted by DigiCert provides insights into the state of digital trust among global enterprises. Effective digital trust management ensures the security, privacy, and reliability of digital processes, systems, and interactions. Establishing and maintaining digital trust has become a significant differentiator for organizational success. The survey targeted 300 senior IT, information security, and software development and operations (DevOps) managers working in organizations with more than 1,000 employees across North America, Europe, and Asia-Pacific. The survey findings were published in the 2024 State of Digital Trust report, highlighting a stark contrast between top-performing companies (leaders) and lower-performing ones (laggards).

Higher Revenue and Increased Employee Productivity

The survey indicated that digital trust leaders, representing the top 33 percent of the respondents, have higher revenue, digital innovation, and increased employee productivity. These leaders excel in responding to outages and incidents, show readiness for post-quantum computing, and effectively utilize the Internet of Things (IoT). They demonstrate a mature approach to administering digital trust through centralized certificate management and the use of email authentication and encryption (S/MIME) technology. Conversely, the bottom 33 percent—the laggards—struggle in these areas, facing challenges in leveraging digital innovation and maintaining robust digital infrastructure and security practices. Notably, while leaders experienced few system outages, data breaches, and compliance issues, half of the laggards reported problems with IoT standards compliance, and many suffered from software trust mishaps. Only one in 100 companies surveyed claimed to have highly developed digital trust practices, indicating a common problem in maintaining enterprise digital trust. Furthermore, 98 percent of reported outages and brownouts were attributed to digital trust issues like expired certificates or domain name system (DNS) problems. None of the respondents were confident in their ability to react promptly to such incidents.

The Challenge of Quantum Computing

The looming growth of quantum computing adds another layer of complexity. Quantum capabilities are rapidly accelerating, driven by tech advancements like generative artificial intelligence. The report uncovers a gap in preparedness for quantum-resistant technologies and the need for strategic action in the face of this evolving threat. According to the data, 61 percent of organizations find themselves underprepared for the post-quantum transition. Leaders estimate a two-year timeframe to fully respond to the quantum shift, whereas laggards project three years or more. This discrepancy highlights the urgency of developing actionable plans, especially given the current five-year window before quantum computing becomes a more pressing concern. Therefore, immediate and strategic action is necessary in the face of uncertainty, said Brian Trzupek, Senior VP of Product at DigiCert. “This quantum thing is a big deal. People are starting to get the visibility that this is a looming challenge. It’s greater than just a digital certificate replacement because it’s fundamentally the algorithm that has been attacked. All the libraries for the dependent client software, for the web servers, for the app servers, for the databases—all those things will need updates, including a certificate, to make that work,” said Trzupek.

Concerns Around SSH Protocols

Survey respondents are concerned on the reliance on the secure shell (SSH) protocol based on the Rivest-Shamir-Adleman (RSA) public-key encryption, which is used ubiquitously across cloud services for secure communication and authentication. Additionally, hardware implementations of RSA, such as secure sockets layer (SSL) offloading and accelerators, present a significant challenge. Trzupek shared an example of one cloud provider that reported having 200,000 such devices, all potentially rendered obsolete by the shift to quantum-resistant algorithms. Another surprising finding is that 87 percent of the respondents reported that their IoT devices transmitted personally identifiable information (PII) over unencrypted channels. This security loophole in IoT devices poses a threat to user privacy. Fortunately, businesses are now recognizing the significance of upgrading their digital infrastructure to protect users.

Issues in Software Trust

There are major developments happening in the realm of software trust, mainly in implementing software bills of materials (SBOMs) or detailed inventories of software components. In the previous report, approximately three percent of organizations were aware of or working on SBOMs. In this report, the number has increased monumentally to 99 percent. While organizations recognize the importance of SBOMs, the actual deployment and meaningful use of SBOMs may not be as widespread as the numbers suggest. Electronic signatures (e-signatures) have also emerged as a key area of interest, with a low percentage of respondents saying their e-signature practices are extremely mature. The business teams, such as legal, human resources, and procurement, usually handle them, not the IT department. Only about one in eight organizations understand the difference between simple e-signatures and the more secure ones that use certificates. Nearly half (48 percent) use electronic seals on their documents, and most (86 percent) use digital signatures with certificates issued by trusted third parties. “There are business processes for how you apply those signatures. We see a lot of customers still struggling to make use of cryptographically secure signatures on content like mortgage documents and healthcare documents. They’re definitely looking at making those processes very easy to use. From our survey here, you can see that that’s something they’re still trying to work on,” said Trzupek.

Bottom Line: How to Enhance Digital Trust

To enhance digital trust, DigiCert recommends that organizations thoroughly inventory their digital assets, define clear policies, centralize public key infrastructure (PKI) management, and prioritize their efforts based on business impact. This can help mitigate security issues, build confidence among customers and partners, and improve operations. Effective digital trust management enables organizations to navigate regulatory challenges, ensuring compliance while protecting sensitive data and adapting to cyber threats.

Nile offers consumption-based pricing, masks all the legacy complexity of operating a network, and makes use of AI to bring the benefits of the cloud delivery model to the network.

Network provider Nile just announced that its Nile Access Service is getting a new solution architecture, including Nile Service Blocks and Nile Services Cloud, along with a few AI application categories (Nile Copilot and Nile Autopilot). The company says this announcement combines cloud-native service delivery and AI-powered closed-loop automation for campus and branch IT infrastructures. For those unfamiliar with Nile, the company launched last year and offers networking as a service (NaaS). While many vendors use the term “NaaS,” it has many meanings. Some have the customer buy the hardware, then get a software subscription and call that NaaS. Another model is to make the customer responsible for choosing the hardware, and then the vendor will charge a monthly fee, akin to a lease model. Nile’s definition follows the as-a-service definition that the cloud providers use. The customers pay for utilization and service guarantees, and the provider determines the underlying infrastructure. Nile offers a pay-as-you-go service that scales up and down based on usage. Nile makes the hardware and software invisible to the customer and is responsible for the maintenance and performance. Recently, I had the opportunity to talk with Özer Dondurmacıoğlu, VP of Marketing, about the details of Nile’s most recent announcement and gain his insights into the role of AI in networking.

Nile redefines network-as-a-service

“If you think about the history of the last 20 years, there was and still is an effort to migrate from on-premises infrastructure — things like management controllers, access points, and switches,” Dondurmacıoğlu told me. “And then there was the idea, ‘We can consume the service monthly or annually. That’s what’s generally called network-as-a-service. But it never reached the potential of software-as-a-service.” Compared to software-as-a-service, network-as-a-service still requires significant manual work—and is very focused on the benefits that accrue to the vendor. “I never worry about upgrading my salesforce.com instance because it’s done for me,” he said. “It’s truly software-as-a-service. On the other hand, if I get switches from my incumbent vendor and sign up for their maintenance program, guess what? I still select my hardware options and must figure out my software releases.” Nile says it has automated the design and activation of its Nile Access Service, from site survey to bill-of-material creation to installation work order management. The service maintains its best state by proactively identifying and resolving deviations from its baseline performance. It automatically tackles trouble tickets without costly troubleshooting and tech support workflows. “So, the news is we are embarking on our initial entry to the market with a distributed solution—what we call an AI networking solution with performance guarantees,” he said.

Nile gets an infusion of AI

The new Nile offering is comprised of the following components:
  • Nile Service Blocks: According to the company, each block represents a collection of physical Wi-Fi sensors, Wi-Fi access points, access switches, or distribution switches. “They’re blocks of network equipment from small to large,” Dondurmacıoğlu told me. “Sometimes one side has an access switch, sometimes it has an access switch, AP, and distribution switches. And sometimes, they have sensors—physical and virtual—to test the network on their own.
The service blocks, which integrate zero-trust networking principles, are designed and delivered automatically to provide secure connectivity. They don’t require manual configuration or software releases because they utilize cloud-native delivery principles and a microservices-based architecture.
  • Nile Services Cloud: Nile says its Services Cloud offering uses real-time observability and optimization of Nile Service Blocks by utilizing both model-centric and data-centric AI technologies. The company says its approach includes some innovations for AI networking, including:
    • Automated day survey, design, and installation
    • Service blocks with digital twins to simulate network operations
    • Zero-trust edge-to-cloud security built into the service blocks
    • High-efficiency real-time data collection from service blocks
    • Closed-loop automation that keeps the network up-to-date
  • Nile AI Apps: Nile has released several categories of applications to help IT admins and end users, including:
    • Nile Copilot applications that help with provisioning the service blocks and monitor outcomes
    • Nile Autopilot applications that handle manual NOC functions like software maintenance

Some final thoughts

Nile’s approach is interesting as it attempts to disrupt the networking industry through a new delivery and pricing model. Over the years, history has been littered with companies that have tried to disrupt by building networking products that were a little faster or cheaper but with the same pricing model, and most have failed. Nile’s approach is to give customers what they need – consumption-based pricing that masks all the legacy complexity of operating a network. AI is now prominently featured as part of their solution to finally bring the benefits of the cloud delivery model to the network. This is a big departure from the “tried and true” model so many engineers are comfortable with, so it will be interesting to see how rapid the uptake of a true NaaS offering is.
To say the cloud is important to how we work, live, and play is a major understatement – the cloud is now a critical element of tech infrastructure. However, what underlies these outages is often a mystery. That’s why I was intrigued by a recent webcast from ThousandEyes, which looked under the covers at the major cloud outages of 2023. Hosted by Brian Tobia, ThousandEyes’ Lead Technical Marketing Engineer, the webcast included a look at the anatomy of an outage. “It’s important to understand the different types of outages we see,” he said. “Understanding them can help you understand how to mitigate some of their impact.” He said outages could vary in the blast radius, whether they’re planned or unplanned, and their mean time to recovery. Let’s take a look at what caused the year’s major cloud outages – and what we can learn from these unfortunate incidents.

Different Types of Cloud Outages

“The distributed architecture of today’s applications means there are a lot of different moving parts that need to be orchestrated for something to actually work,” Tobia said. “And a lot of these parts are often single points of failure. Because they’re reused in multiple applications, like an API or a common service, we can see the impact of an outage more widely felt, despite it being a single service.” Tobia noted that tracking cloud computing outages can help teams identify patterns and prevent customer service disruptions. Looking at the ThousandEyes report from 2023, Tobia said there were many different types of outages. “Overall, we still saw the most common type being ISP-related outages,” he said. “But we saw that there was an increase in CSP outages in 2023 compared to the previous years.” In 2023, the number of US-centric outages increased from 34% to 37% and minor outages became more common. “We’re seeing that these smaller, more contained outages are becoming more common,” he said. “Before, there were traditionally a lot of bigger network outages—like really big ones—that would take down a whole bunch of services. But now we’re also seeing smaller ones.” But even a cloud outage that starts in the US due to maintenance activity at night can cascade into other geographies in the middle of their business days.

Application Outages On the Rise

Tobia said that application outages, which continued to rise in 2023, can have a greater impact. A network outage will affect a single provider, but not so for applications. “The application outage really cascades because a bunch of people are relying on that one application,” he said. “It doesn’t matter what network you’re coming from.” He then moved on to look at some outage examples from 2023, focusing on how ThousandEyes works. “We’re able to collect all this data through ThousandEyes,” he said. “Being able to correlate that and collect all this data, it’s really important to get the end-to-end picture of where an outage might occur. And then, also really important, correlate that across every layer.” He added that ThousandEyes can show users every layer of a connection, whether it’s related to border gateway protocol (BGP), networks, applications, HTTP errors, or page load times.

Top Cloud Outages of 2023

Tobia detailed the list of 2023 outages, including:
  • A 90-minute outage for Microsoft on January 25: This was due to BGP changes that caused network issues. “This was total chaos from a BGP perspective,” Tobia said.
  • A two-hour outage for Outlook on February 7: This resulted in service unavailable/application errors. “The last outage was more around some changes on their ISP routers and other WAN routers,” he said. “This may have been more on the application side.”
  • A seven-hour Virgin Media outage on April 4: This outage arose because of a BGP route withdrawal that caused network traffic loss. “It was kind of similar to what we saw on the on the Microsoft side, when those BGP changes were occurring,” he said. “Without a route to the Virgin Media UK network, a lot of the Internet and transit providers dropped the traffic.”
  • A two-hour AWS cloud outage on June 14: This outage caused latency, server timeouts, and HTTP errors. “They eventually identified the issue as being part of their capacity management system located within US-EAST-1,” he said. “And this impacted services like Lambda API gateway, and the actual management console itself, Global Accelerator.”
  • A two-hour Slack cloud outage on August 2: As a result of this outage, users couldn’t send or receive messages. “Network paths were totally fine,” he said. “We didn’t see any packet loss, latency, or anything like that. So it was purely an application or client issue.”
  • An 18-hour Square cloud outage on September 8: This outage resulted in app errors and backend transactions failing. “This outage prevented it from processing transactions,” he said. “So end users were actually able to submit a transaction – some sellers who were using this to receive payments were successful, [but some users] reported connections dropping out or things not working.”
  • A 36-hour Workday/Cloudflare outage that started on November 2: A complete power failure at a Cloudflare data center caused application and service issues. “Cloudflare was the provider and Workday was an application that runs on Cloudflare infrastructure,” he said. He noted that DR resources took 6 hours to come online. “So there was a complete outage until that facility came online,” he added. “It was able to serve requests at a diminished rate and then full resolution didn’t happen until more than 36 hours later.”

Bottom Line: Need for Monitoring to Prevent Cloud Outages

It was a busy year! Clearly, Tobia’s examples of cloud outages were sobering. Who thought a full power outage was possible today with the sophisticated data centers that providers like Cloudflare run? But they still had to deal with the arduous process of getting their DR up and running and working with a power company that may not move at the fastest pace. Tobia’s presentation also underscored the importance of monitoring resources to understand what happens when a service goes down so that one can learn and avoid repeating the same mistakes. Unfortunately, for most businesses, having a backup for every cloud service the organization uses would be fiscally challenging. For support, IT leaders can use data from companies like ThousandEyes to make uptime part of the evaluation criteria.
Arista Networks Inc. today released a new network observability software offering that brings together network infrastructure performance and data from compute and server systems of record to provide application and workload performance insights for data centers, campuses and wide-area networks. Dubbed CloudVision Universal Network Observability, or CV UNO, the new software is aimed at reducing enterprise risk, improinge fault detection and correction, and simplifying cross-functional coordination using systems-level capabilities. The company says this approach speeds up time to recovery regardless of the root cause. Historically, network engineers worked with management tools that functioned on specific domains. The campus network had one console, Wi-Fi another, data center a third and so on. This created the concept of “swivel chair” management, where a network engineer moved among multiple consoles and correlated the information manually. Although this was never ideal, it worked when networks were static. Today, networks are constantly changing, and the volume of data networks generate has exploded, making legacy operations no longer viable. Arista’s approach is to deliver a single observability offering across the end-to-end network. Arista CV UNO includes the following capabilities:
  • Workload application and infrastructure discovery: According to Arista, CV UNO automatically identifies applications, hosts and workloads across diverse platforms and information technology systems. It offers a comprehensive view of the network and application landscape by combining data with CloudVision’s insights under Arista Network Data Lake, or NetDL. It also constructs an application-to-network graph that continuously updates, providing a historical perspective on the environment’s evolution. Arista’s NetDL is a single data source for the entire network and enables the company to map an application to a network. Without it, network professionals would need to stitch together information from separate systems manually.
  • Proactive risk analysis: CV UNO facilitates proactive risk analysis through real-time application-to-network graphing within the change management process. It aids in cross-referencing and analyzing network issues and anomalies, enabling the assessment of potential disruptions before implementing changes in production and mission-critical networks. This information can be used to bridge the gap between security and networking teams.
  • Real-time network change impact analysis: CV UNO analyzes and applies machine learning to the dataset within NetDL, identifying how network provisioning or state changes affect business and critical applications. It automatically pinpoints the impact of network alterations on application performance, empowering network engineering and operations teams to address issues swiftly. Tracking errors created from network changes can be difficult, if possible, with legacy tools. AI-based automation for change analysis is an ideal use case to introduce AI into the network.
  • Host or application change impact analysis: CV UNO guides operators or engineers to the precise root cause of application performance issues, even when the network remains unchanged and without deploying host-based agents. This capability streamlines issue resolution and cross-functional coordination for the operations team.
  • Topology-aware determination: The tool accurately discerns the root cause of application performance issues by consolidating insights from infrastructure systems, virtualization machines, systems of record and network flow and state data. This approach minimizes the tendency for blame-shifting associated with traditional methods.

Standard CV UNO components

  • CV UNO Sensor gathers, standardizes, and organizes flow/SNMP data from various sources, such as VMware vCenter, DANZ Monitoring Fabric and third-party network devices, and transmits to NetDL.
  • CloudVision-UNO is accessible via a premium feature license and integrates with and enhances CloudVision’s operational and network telemetry capabilities. It employs Machine Intelligence-based Analysis on NetDL-stored data to deduce topology-aware correlations among events, changes and anomalies, thereby speeding up root cause analysis and issue resolution.

CV UNO options

  • The Recorder Node supplements packet capture, query, and replay functionalities to support intrusion detection, incident response and forensic use cases.
  • The Service Node provides additional advanced packet processing functions, including end-to-end application latency analysis and DPI-based Application Identification and classification.
  • The CV UNO Analytics Node offers distributed context-aware traffic analysis and machine-learning capabilities for large-scale optimization.
CV UNO will be generally available in the second quarter.

Some final thoughts

Arista is bringing together multiple network domains with full application visibility and troubleshooting, which will streamline network operations and improve uptime and reliability. With disparate operating systems and a lack of consistent data models across networks, delivering systems with this level of visibility has been impossible. Arista’s development of CV UNO is a welcome addition for IT groups challenged by stringent regulatory compliance, cybersecurity and observability throughout the enterprise. These kinds of tools are no longer optional but rather essential imperatives. Automation, once a dirty word in engineering circles, is now critical to keeping networks up and running, and this starts with visibility. The adage goes, “You can’t manage what you can’t see,” so it stands to reason the more you see, the more you can manage.
In its recently reported fourth-quarter results, Zoom Video Communications Inc. put up strong numbers, beating revenue expectations by $17 million and operating income by $32 million. Looking ahead to fiscal year 2025, Zoom management projected revenue of about $4.6 billion, representing revenue growth of 1.6%, in line with Wall Street expectations. The company reported a bullish outlook for earnings, estimating $4.85 to $4.88 per share, well ahead of consensus estimates of $4.72 per share. All in all, it was a solid quarter for Zoom, and the stock rose more than 10% in after-hours trading. Still, it’s important to look beyond the numbers to understand the state of the business and whether the company is headed in the right direction. After reading the earnings transcript, Zoom seems to have the right parts of the business firing. These are most notable points:
  • CCaaS license growth increased 3X year-over-year. The company also had two large wins with ARR greater than $1M. If there is one metric that Zoom watchers should be tracking, it is contact-center-as-a-service momentum, as the company has made this its No. 1 priority. On the earnings call, CEO Eric Yuan pointed out that he is now the general manager for the contact center business. About a month ago, I met with Yuan in the Zoom offices, and he told me he did that to enable the CCaaS business unit to act as a startup inside Zoom. On the earnings call, Yuan was particularly optimistic, driven by the completeness of the offering. “A huge enterprise customer wanted to buy 1,000 agent seats, and we sold them Zoom Expert Assist, workforce management and employee management,” he said. “You can see Zoom has become a full-suite contact center offering. We can now compete head-to-head with any of the legacy incumbents.”
  • Zoom Phone’s continued growth. On the call, Chief Financial Officer Kelly Stackelberg highlighted that the number of Zoom Phone customers with 10,000 or more seats grew 27% year-over-year, to 95. Despite its success, there is still industry chatter that Zoom Phone cannot meet the needs of telephony-heavy organizations. The large customer wins are one testament, but there are other indicators. I recently talked to the chief information officer of a law firm that signed with Zoom for over 2,000 Phone seats. When I asked the CIO why Zoom, given legal considerations, is so phone-centric. He told me he was initially skeptical, but Zoom has all the required features. In fact, seven of the 10 largest law firms in the U.S. now use Zoom Phone.
  • AI Companion is now deployed in over half a million accounts. Launched only five months ago, AI Companion is being used in more than 510,000 accounts to create more than 7.2 million meeting summaries, up from 2.8 million last quarter and 220,000 the quarter before. The next big communications battleground is AI; ramping up this part of the business now is critical to long-term customer retention.
  • Zoom Chat usage has increased by 130% across its paid accounts. If one feature has made Microsoft Teams sticky, it’s chat. Once customers use chat, they start putting data in it, and it becomes incredibly difficult to remove, so winning the chat battle is a big step in winning the collaboration war. To help ease the pain of migrating, Zoom created a migration tool, which, according to Zoom, has seen a four-times increase in downloads over the past six months. During her portion of the prepared remarks, Stackelberg specifically called out Zoom Chat as an important component in customer retention.
  • The enterprise segment increased 9% year over year. The Street had estimated enterprise growth to be a tepid 3% but Zoom blew that out of the water. Larger customers now account for 58% of Zoom revenue. The company started as a prosumer and small business provider but has steadily worked to move up the market and appears to have cracked that code. Enterprises bring larger deals with more products and higher margins, so Zoom’s ongoing ability to win more in this segment bodes well for the future. It’s worth noting the Online portion of the business was flat year-over-year, a marked improvement over the 10% decline a year ago. Stabilizing the Online business is something investors have been waiting for since the pandemic gave the company an artificial boost.
The ”land and expand” strategy isn’t unique to Zoom. All the unified-communications-as-a-service and CCaaS providers want to work from their position of strength and add other products. What’s interesting about Zoom is they have something few information technology vendors have: demand from the user community. During the pandemic, lawyers, doctors, consultants and others used Zoom to attend parent-teacher meetings, church services and event fantasy football drafts. People generally like Zoom, are comfortable with it, and are not afraid to ask for it in the workplace. As the UCaaS and CCaaS vendors start stepping on each other’s toes, pull from the user community should tip many scales Zoom’s way. With earnings calls, there are many ways to hit a number, but Zoom is focusing on the right activities, which should put it in a position for long-term success.
8x8’s Engage Product to Bring Contact Center Capabilities Outside the Contact Center

As customer experience becomes a way for companies to compete, they need tools that give contact center capabilities to non-contact center personnel. This offering is aimed at that business need.

8x8’s Engage Product to Bring Contact Center Capabilities Outside the Contact Center
Cloud-based communications provider 8x8 launched a new offering called 8x8 Engage, designed to meet the needs of customer-facing employees who operate outside the traditional contact center environment. The platform combines 8x8’s unified communications as a service (UCaaS) and contact center as a service (CCaaS) capabilities in a user-friendly format. 8x8 Engage utilizes artificial intelligence (AI) to provide insights and data analysis through deep integration and data synchronization with native and third-party enterprise apps, including 8x8 Technology Partner Ecosystem partners. 8x8 Engage’s key features include a customized contact center interface, queue management, integration with other apps, AI-powered tools, and comprehensive analytics. Here’s a closer look at each of these features:
  • Customized Contact Center Interface: Simplifies conversations and collaboration as all customer-facing workers use the same platform.
  • Queue Management: Seamlessly transfers customer interactions with full context and details, ensuring continuity across the organization.
  • Integration with Third-Party Apps: Works with other CX apps to automate workflows and provide access to data. This would include CRM systems, supply chain tools, and vertical applications.
  • AI-Powered Tools: Uses AI to analyze conversations and summarize interactions while recommending actions to enhance the CX.
  • Comprehensive Analytics: Offers a central place to view data and insights from customer interactions across the organization.
Over the past five years, customer experience has dramatically increased in importance. My research shows that today, 90% of businesses compete on CX, up from only 26% five years ago. This has compelled companies to give contact center capabilities to non-contact center agents such as salespeople, inside sales, customer success, and even field service. One organization I interviewed has 50 agents and recently added 100 more non-agent seats as it enables more people to interface with customers faster and more accurately. One of the challenges of scaling up customer-facing operations is that many workers only need a partial agent interface. For example, a field adjuster for an insurance company only needs the ability to contact a customer, look up history, and add images and notes. A full agent dashboard would be overkill. 8x8’s customizable interface allows the organization to streamline workflows as it simplifies the interface for the worker. 8x8’s approach signifies a shift from a platform that merely connects different systems to one that reimagines how customer service is delivered and by whom, explained Fabio Ramos, vice president of product marketing at 8x8. He told me, “8x8 Engage allows for more efficient routing of customer interactions, not just to the contact center but to the appropriate subject matter experts—a capability lacking before.” This is especially important since many employees outside the contact center directly support those within it. 8x8 estimates that 20 to 60 percent of employees fall under this category, particularly those in sales, customer success, accounting, finance, billing, and marketing. These areas require support capabilities like those of contact centers. “They are subject matter experts in areas they’re responsible for, and it just happens that a part of their day involves dealing with customer interactions. We need to make sure that the interaction journeys are fully captured with this product. It’s a completely different persona from a contact center agent,” said Ramos. 8x8 explores this shift further in a forthcoming report, Customer Experience Responsibility Beyond the Contact Center, which was recently published. The report uncovers a considerable gap in CX journeys, supporting that 98 percent of leaders view CX as an organization-wide initiative, and 92% acknowledge the push for cross-departmental CX initiatives; only 6 percent believe that CX consistency is achieved across all departments. This disparity indicates that many organizations may still need to possess the necessary technology and backend systems to provide CX across the board. 8x8 offers role-based access and pre-packaged, persona-driven templates for various industries, addressing the need to maintain consistent CX across departments. Organizations can customize their experience by adding or removing features in Engage. Team leaders can gain insights into their customers by analyzing detailed reports using visualizations, which present data in a more straightforward format. Moreover, the platform is compatible with mobile devices, making the data accessible anytime and anywhere. This can be useful for workers on the go, such as field service and campus workers. Essentially, 8x8 is moving beyond its XCaaS, which integrates various communication services into a single cloud offering. The vendor is positioning 8x8 Engage as a standalone product with unique capabilities. It’s worth noting that 8x8 allows organizations to mix and match 8x8 Engage with other X Series products, such as its Frontdesk offering. Unlike traditional contact center solutions, Engage aims to provide a more personalized and autonomous CX. Ramos noted that as Engage develops, it will cater to a wide range of industries, including retail and healthcare, focusing on roles that require direct customer interactions outside the contact center. The ability to serve the needs of non-contact center agents greatly expands the contact center TAM. If every customer did what the one I cited did, that would triple the market. I don’t think all companies will do that, but I think it’s possible that delivering the right functionality to each worker can double the addressable market. For 8x8, 8x8 Engage allows them to aggressively go after contact center customers, even if there is an incumbent as it can look to sell 8x8 Engage into other business units and then displace a competitor later.
The shift toward hybrid work is more than a trend; it transforms how we view and value the workplace. Employers and employees alike are navigating this new terrain, balancing the appeal of in-person collaboration with the autonomy of remote work. Despite the positives, there is a notable gap between employee expectations for the office environment to support hybrid workspaces and the current state of office readiness. To explore this trend, Cisco recently surveyed 3,500 employees and 1,050 employers from companies of all sizes across seven European countries: France, Germany, Italy, The Netherlands, Poland, Spain, and the UK. The findings were published in a report, The Race to Reimagine Workplaces and Workspaces for a Hybrid Future, released as part of the company’s Cisco Live EMEA activities.

Enthusiasm is High But Readiness Lags

The report sheds light on the current state of hybrid workspaces and work in Europe, revealing both enthusiasm and challenges. It also examines differences in responses to the technologies used by Baby Boomers, Gen X, Millennials, and Gen Z, debunking common misconceptions about employee attitudes toward hybrid work. The enthusiasm for returning to the office is clear, driven by the potential for enhanced productivity, collaboration, and a sense of belonging. However, the readiness of office spaces to support hybrid workspaces is lagging, with only a fraction of employers and employees considering their offices well-prepared for this new way of working. The report highlights a pressing need for office redesigns to accommodate a multi-generational workforce’s demands better. Currently, nearly 80 percent of organizations in Europe employ at least 10 percent of their workforce in hybrid roles, with half reporting over 30 percent of their staff coming to the office three to four days a week. A significant aspect of this shift is that a third of all office interactions now involve remote workers, highlighting the need for collaboration technology. As we advance, 83 percent of employers anticipate that hybrid work will become the norm within two years. The desire for personal flexibility and comfort largely drives employees’ preference to work from home. Notably, work preference varies by generation. Baby Boomers prefer office-based work, while Gen Z and Millennials prefer remote and hybrid arrangements. According to the findings, 68 percent of employers have received positive feedback on mandates for returning to the office, and 74 percent of employees express a positive view.

The Need for Collaborative Spaces and Tech Infrastructure

There’s a significant gap between what employees expect from their office environment and what is currently available, especially in areas critical for hybrid work, such as collaborative spaces and tech infrastructure. Only 32 percent of employers and 37 percent of employees consider their office spaces well-prepared for hybrid work. The reason is that current office setups do not adequately promote in-office productivity, with most spaces consisting of workstations. Employees and employers find personal workstations and meeting rooms only moderately effective, highlighting the need for updated office space designs. This data should not be a shock as many European office spaces have not seen a significant technology upgrade in decades. Redesigning office spaces to meet the expectations of a multi-generational workforce can be challenging due to varying perceptions of the effectiveness of meeting rooms. The key reasons for the perceived ineffectiveness of meeting rooms include:
  • The absence of video and audio (42 percent)
  • Poor audio-visual quality (37 percent)
  • A lack of inclusivity and consistency for remote participants (26 percent)
Shockingly, less than half of the meeting rooms in office buildings are equipped with video and audio capabilities. Furthermore, employees and employers are concerned about the lack of seamless integration among collaboration tools, with only 10 percent of Gen Z employees considering the current tools seamless. The report also points out a surprising underemphasis on sustainability in office redesigns despite the growing importance of eco-friendly practices in corporate strategy. Only 45 percent of employers and 36 percent of employees view eco-friendly practices as top priorities in workspace redesign. This lack of oversight may be contributing to the trend of increasing office footprints. Despite this trend, employers remain focused on improving the employee experience through office redesigns. Most employers (90 percent) and employees (87 percent) believe a positive link exists between workspace design and employee satisfaction. Furthermore, over two-thirds of employers try to ensure a smooth transition between home and office environments. Common support measures include:
  • Flexible work arrangements (50 percent)
  • Technology usage training (48 percent)
  • Enhanced network infrastructure at both home and office (42 percent)
The technology tools provided to employees primarily include:
  • Video conferencing platforms (54 percent)
  • Instant messaging/team chats (52 percent)
  • Cloud-based document sharing (49 percent)
  • Project management (43 percent)
  • Virtual meeting rooms (33 percent)
Simplifying the user experience remains a significant challenge in ensuring employees can effectively use these tools. In fact, 75 percent of employees lack proficiency with project management and collaboration tools, while 71 percent are deficient in video conferencing and 70 percent in cloud-based document sharing.

Advice for Hybrid Work Upgrades

Cisco makes several recommendations to companies with hybrid work models. This includes rejuvenating meeting spaces, implementing hybrid-friendly technology and network solutions, refreshing office layouts for improved collaboration, and embedding sustainability into workspace designs. Companies of all sizes should be addressing connectivity issues and ensuring interoperability to provide a seamless, stress-free work experience. Moreover, Cisco recommends fast-tracking hybrid work strategies to align with technological advancements, workspace aesthetics, and corporate culture. Companies must understand that technology alone is not enough. Adequate training and support are also necessary to ensure ease of use and improved productivity. Achieving an optimal hybrid environment requires a balanced approach that’s both productive and sustainable, where employees can thrive in the new era of work.

Bottom Line: Hybrid Workspaces

Over the past year, many businesses have mandated employees return to the office only to have to repeal the mandate a short time later. Before organizations lay the hammer down, they should look at the office’s technology to ensure it facilitates a best-in-class experience. Investing in this area will go a long way toward employee happiness, which cuts churn, improves morale, and makes everyone more productive.

Barcelona is the center of the tech world this week, with the extensive MWC 24 conference drawing an international crowd. On day one of the event, Cisco announced a range of AI-related investments aimed at helping global service providers. I had the chance to hear three Cisco Networking leaders preview this week’s announcement in a briefing. Hosting the briefing were Bill Gartner, SVP/GM of Optical Systems and Optics, Kevin Wollenweber, SVP/GM of Data Center and Provider Connectivity, and Masum Mir, SVP of Provider Mobility

Gartner led off by describing their global service provider community. “We know from many years of experience in this industry that these service providers must continue to provide their customers with great user experiences,” he said. Their priorities are to continue finding ways to grow revenue and do that at lower capex and opex. And we’re helping our customers drive those user experiences, reduce costs, and drive revenues.”

This week’s announcements included the following service provider use cases.

Cisco and TELUS partner in connected cars

The Canadian service provider TELUS and Cisco have joined forces to launch new 5G capabilities to serve IoT use cases, focusing on connected cars. TELUS uses Cisco’s Mobility Service Platform to improve and simplify the driver experience, enabling auto manufacturers to realize new revenue streams. TELUS expects to onboard over 1.5M 5G cars onto the platform over the next several years.

Masum Mir says the company sees connected cars as a global phenomenon. “We’re seeing all the car makers around the world making connected vehicles the default going forward,” he said. “So, by 2028, we believe 90% of the new vehicles will be connected by default. Those connections are mission critical. It’s not only providing infotainment, but the safety of the vehicle and drivers will become paramount. And it needs a reliable network.”

Using partnerships to connect people, places, and things

Cisco announced it’s working with service providers worldwide to help monetize their infrastructure. In collaboration with AT&T, BT, Reliance Jio, stc, XL Axiata, and TELUS, Cisco is looking to support the needs of enterprise customers with better network experiences.

Mir said the company has seen some caution on the part of providers regarding capital investments. “How do we help our service provider customers to get to monetize the massively scalable infrastructure they have put on the ground?” he asked. “How do you find newer revenue streams faster and remove friction to acquire new customers at a much faster rate?”

One of the challenges for Cisco and its peers is that telco spending tends to be very lumpy, often with long delays and canceled upgrades. Despite years of discussion on how service providers must create new revenue streams, most telco modernization efforts have revolved around cost savings. The lack of impact on revenue eliminates the urgency to upgrade infrastructure. What’s needed is a greater focus on innovation to improve topline. On the call, Cisco shared several ways it intends to help.

  • Cisco and DISH have worked on a 5G hybrid cloud network slicing solution that should result in faster launches of new services for enterprises.
  • MKI, Cisco, and KDDI Engineering implemented private 5G to support networking operations at Shinwa Komaki, a top Japanese manufacturing facility.
  • Cisco is working with du Telecom on a Middle East cybersecurity transformation focused on using AI and automation to transform du’s SOC into an advanced Cyber Defense and Intelligence Center.
  • Cisco is collaborating with T-Mobile to build a connected workplace: T-Mobile that unites 5G Business Internet, Cisco Meraki devices, and managed services.

None of these use cases would fall under the category of a “silver bullet” that can be applied to all service providers globally. Rather, they’re examples of what’s possible. The goal would be to create a portfolio of use cases that could be used to highlight different business outcomes.

Bringing the ecosystem together

Cisco is bringing its ecosystem together to develop standards and services. The company shared that it would feature a number of those developments at its booth at MWC, including private 5G and AI-driven vision with NTT DATA, an automated guided vehicle (AGV) with an Airspan radio with Deloitte, a look at the future of IP video and sports with Orange and a partnership with Intel to deliver 5G enabled manufacturing and AI use cases.

Infrastructure has grown in complexity as many more moving parts are delivered from a growing ecosystem. If network services are to solve industry challenges and deliver on business outcomes, a more collaborative approach is required for Cisco and its partners. Bringing the ecosystem together to create standards will spur innovation and create a rising tide for everyone.

Final thoughts

Historically, Cisco’s service provider business has ebbed and flowed depending on where the company was with product cycles. About five years ago, Cisco rolled out Silicon One to bring webscale performance across its portfolio with consistent features. Last year, it hit another major milestone with the release of the Cisco Networking Cloud, which brings all the data from historically disparate products together for simplified management and operations. More importantly, Cisco has been focused on helping its telco customers better utilize their networks to deliver new services that can be monetized. Telco profitability is something the entire ecosystem should care about, as a more profitable telco leads to more spending and faster innovation, and that's a win for everyone.

VMware Inc. announced several product updates to its networking and security products at Mobile World Congress 2024 in Barcelona, in the first major update for the company since Broadcom Inc. acquired it. Before the event, I had a preview of the developments with Abe Ankumah, head of SASE/SD-WAN, and Padma Sudarsan, the chief of architecture for telco, both leaders in Broadcom’s software-defined edge division. They gave me the details on the announcements, which include VMware VeloCloud SASE, expanded collaboration with Singtel around connectivity and edge computing, and the ability for CSPs to modernize and monetize networks with the VMware telco cloud platform.

VMware VeloCloud SASE with Symantec

VMware had an existing solution, but it now includes integration with Symantec, another Broadcom company. Ankumah explained the logic behind this: “This is a single-vendor SASE solution that brings the capabilities of VeloCloud SD-WAN together with the SSE stack from Symantec.” The offering comes after considerable work integrating VMware VeloCloud SD-WAN and Symantec Security Service Edge or SSE. This is part of the Broadcom playbook, where it creates cross-sell opportunities across its portfolio of software assets. At MWC, I stopped by the VMware stand and asked the company about how tightly integrated the offerings are today, and it told me that currently the VMware and Symantec clouds are connected to pass data between them, with the next step being data integration. The company also beefed up its SD-Access capabilities by adding Symantec capabilities. On the call, Ankumah added: “We’re bringing to bear a newly released SD-Access solution that provides end-user connectivity with a client footprint that supports both remote access and IoT connectivity and securing that through the Symantec SSE capability that is globally distributed and deployed across at various points of presence.” This integration should help VMware in its quest to move up the Single Vendor SASE Magic Quadrant. The company debuted last year but was placed in the lower left quadrant. Gartner cited the strength of its software-defined wide-area network solution but called out security. Symantec has been through many ups and downs but does have a quality security offering and should help VMware move up and to the right. This new release is aimed at Broadcom’s installed base of VeloCloud and Symantec customers and is now generally available. One interesting note: Broadcom is reintroducing the VeloCloud brand. The company explained that, although the product name was VMware SD-WAN, many customers kept referring to it as VeloCloud, so to simplify things, the decision was made to bring it back. The newly rechristened VeloCloud portfolio includes VMware VeloCloud SASE, VMware VeloCloud SD-WAN and VMware VeloCloud SD-Access products. Ankumah clarified that, with this new approach, Broadcom isn’t looking for vendor lock-in. “Now, the other thing I want to point out is our intention to continue to offer customers flexibility and choice,” he told me. “And so, in addition to our own single-vendor SASE solution, we continue to support third-party integrations with our partners.” According to Ankumah, those partners include Cisco Systems Inc., Palo Alto Networks Inc., Netskope Inc., Zscaler Inc. and Lookout Inc.

Expanded collaboration with Singtel around connectivity and edge

VMware is increasing its work with Singtel to help their joint customers manage connectivity and cloud infrastructure using VMware Edge Compute Stack through Singtel Paragon, an all-in-one orchestration platform for 5G and edge cloud. This partnership expansion will help enterprises take advantage of Singtel 5G without redesigning their applications. Broadcom and Singtel say they’re jointly creating an innovation lab that will bring 5G and edge-native experts together with commercial model specialists to hasten the building and testing of enterprise apps.

Helping CSPs modernize and monetize networks

VMware announced it had deployed VMware Telco Cloud and the VMware Service Management and Orchestration framework by CSPs and co-innovations with its telco partner ecosystem. Sudarsan shared some details on this. “The SMO from VMware is a service-based architecture that provides Cloud Smart automation of flexible and intelligent orchestration of network functions to place them at the best location to serve their functional purpose,” she said. “It also has observability and assurance service across RAN and core and network programmability with the analytics and optimization service.” The company now has a 35-member partner ecosystem that network function vendors and other companies.

A DISH pilot and Vodafone proof-of-concept

In addition, Sudarsan shared details of two customer deployments, including DISH Wireless and Vodafone.
  • DISH Wireless is running a pilot of VMware Telco Cloud Service Assurance across its Boost Wireless Network. The company runs multivendor, cloud-native network traffic and has launched more than 20,000 5G sites. Broadcom says VMware’s Telco Cloud Service Assurance enables DISH Wireless to manage its multivendor environments holistically and more efficiently.
  • This week at MWC, Vodafone plans to demonstrate a proof of concept that focuses on applying network programmability and intelligence into the RAN to address network challenges caused by short-form video content.

Some final thoughts

When Broadcom announced its acquisition of VMware, I was wary of how Chief Executive Hock Tan would handle the company’s assets. In line with his tendency to chop off pieces of the companies he acquires, Broadcom announced it intends to spin out VMware’s end-user compute business to KKR for $3.8 billion. Does that mean that more offloading is around the corner? It’s unclear. But the announcements at MWC — and the solid value for partners and enterprises they hold — indicate that Broadcom does see its value in VMware’s software-defined networking and cloud portfolios. I expect these to be areas of investments with more integration across Broadcom companies. But only time will tell. So far, so good.
Two of the big themes at the 2024 edition of Mobile World Congress in Barcelona this week are artificial intelligence and 5G — and although one might view the two as separate technology trends, they are linked. Service providers are currently investing heavily in maintaining and upgrading their services to comply with evolving tech standards for mobile networks. Despite efforts to improve service quality and capabilities, telcos have struggled to increase revenue, creating ongoing financial challenges and causing many to focus on cost savings. At the same time, AI requires a heavy investment in infrastructure, which service providers may be hesitant to do until they can be sure there’s a strong return on investment. This divergence presents an opportunity for the telecom industry to integrate AI into its operations and has set the stage for creating the AI-RAN Alliance. The new initiative, launched at MWC24, aims to bridge the gap between traditional telecom infrastructure and AI. It’s a consortium of leading companies, universities, and industry players, including Amazon Web Services Inc., Arm Holdings Ltd., DeepSig Inc., Ericsson, Microsoft Corp., Nokia Corp., Northeastern University, Nvidia Corp., Samsung Electronics Co. Ltd., SoftBank Group Corp. and T-Mobile USA. The AI-RAN Alliance represents a strategic shift toward embracing AI and its growth potential to mitigate the telecom industry’s financial pressures, Ronnie Vasishta, senior vice president of telecom at Nvidia, explained during a launch briefing. The primary goal is to merge AI with radio access network technologies and create new business opportunities in telecom, particularly with the upcoming 5G and 6G networks. Specifically, the alliance will focus on three key areas:
  • AI for RAN focuses on the shared infrastructure that supports AI and the RAN. AI can be used to make the radio network more efficient.
  • AI on RAN is to enable service providers and their ecosystem to create new applications that can run on 5G networks.
  • AI for RAN, where AI is used to improve the spectral efficiency of running the network.
This alliance will jointly develop use cases, white papers, blueprints and guidelines for best practices and liaise the findings with existing standards organizations. “One of the biggest challenges has been the availability of data. AI requires data to be effective, but data availability has been somewhat restricted,” Vasishta said. “So we want to create an environment where data can be shared, and datasets can be provided to enable AI to be more efficient. The verification testing will be conducted within the AI-RAN Alliance Labs, which members can access.” Another challenge is enhancing 5G infrastructure by addressing the connectivity issues that have limited its potential. To achieve this, the infrastructure needs to be moved closer to the point of use, and software-defined RAN needs to be enabled on the same infrastructure. This will improve the user experience and service efficiency for current applications and allow advanced AI-driven apps like AI inference to perform better. By supporting low-latency, high-bandwidth apps, telecom companies can maximize the potential of 5G networks. Mohamed Awad, senior vice president and general manager of the infrastructure line of business at Arm, echoed the sentiment, stating that AI could improve network infrastructure performance at both the level of individual operators and the overall system by bringing network equipment closer to the users. Awad also noted that using AI within RAN may improve other areas. “This is one of those things where you’ve got a big problem, and the more teams you have looking at it and helping solve it, the better,” said Awad. “As we think about new capabilities that are being unlocked, this is really about what happens as the infrastructure matures and additional technology is added.” Service provider success is critical to the health of the tech sector. Over the past several decades, the telcos have been continually marginalized to the point where most of their services are considered commodities. With the rise of cloud, mobility, and AI, the world has become network-centric, putting service providers in their strongest position for a long time. One of the more interesting opportunities for telcos is AI inferencing at the edge, which can be used for healthcare, robotics, warehouse automation and more. This requires high bandwidth, low latency and highly distributed computing, all of which service providers are good at. However, if telcos continue to get squeezed on prices and see margins decline, that creates a vicious cycle where they pull back on investing, which holds back innovation. This alliance focuses on helping service providers use AI to not only cut costs but also to identify those mythical new revenue streams that have eluded them for so long.
What RingCentral’s Earnings Say About Its Expansion Plans

Vlad Shmunis’s return to the CEO office marks the beginning of a cautious plan for growing its customer base outside the usual constituencies.

What RingCentral’s Earnings Say About Its Expansion Plans
This week, RingCentral announced its Q4 fiscal year 2023 results, the first results after Vlad Shmunis retook the captain’s chair of the Starship RingCentral. On Tuesday, February 20th, the company delivered results that were in line with Street expectations. RingCentral posted revenue of $571 million, which was $1 million above analysts’ consensus. Operating income came in at $117 million, which was $3 million ahead of the expected number. Looking ahead, the company put up light guidance for the upcoming quarter and full year. RingCentral guided to 8% growth for Q1 and for the full fiscal year, while the Street had a 9% estimate. This light guide shouldn’t be a surprise as RingCentral has historically been conservative, and given all the macro uncertainties, this is consistent with the past. Shmunis has often told me he would rather under-promise and over-deliver. One notable point from this call was the strength of the enterprise business. Shmunis stated, “I am particularly proud to report that this segment (enterprise defined as $100,000+ in annual recurring revenue) has just achieved $1 billion of annual recurring revenue (ARR).” He also highlighted that 20% of the Fortune 1000 are RingCentral customers. Amongst these are two of the world's three largest hotel brands, one of the largest car rental companies, and many financial services companies. Shmunis summed up the enterprise momentum by highlighting a couple of customer wins. A Fortune 100 insurance company purchased 20,000 UCaaS seats and a Global 500 retailer bought 18,000 UCaaS seats. These data points should help shed the image that RingCentral is only for SMBs. While steady as she goes is the theme for RingCentral right now, Shmunis noted a concerted “land and expand” approach on the call. New products like RingCX, RingSense for Sales, and RingCentral Events are expected to deliver $100 million in combined ARR by the end of 2025. Cross-selling additional products creates greater stickiness, which improves net retention, a critical metric for investors, and leads to bigger deals with higher margins. On the investor call, Shmunis explained the go-forward strategy, “I returned as CEO to deliver on our strategy of; one, delivering durable growth and value from our core; two, expanding our TAM by turning RingCentral into a multi-product, AI-first communications leader. To that end, we have recently added three new products to our portfolio: RingCX, our native, AI-first contact center; RingSense for Sales, our conversation intelligence platform for sales professionals; and RingCentral Events, our new virtual, hybrid, and onsite events platform.” It’s worth noting that the $100 million is getting a running start as the company has seen early adoption. According to Shmunis, the company currently has one hundred paying RingCX customers, up from 50 when the company launched in November. He cited two Fortune 1000 companies who each purchased over 1000 seats. This is good to see as, when RingCX launched, many industry watchers positioned the product as targeted at smaller businesses. The company also claims “hundreds” of paying RingSense for Sales customers, which is impressive given it was launched in the back half of 2023. Regarding RingCentral Events, recall the company purchased Hopin’s Event’s business about six months ago for this capability. Since then, hundreds of customers have hosted large events on it, including Spotify, Reddit, and Hubspot, which were specifically called out. This “expand” strategy creates interesting competitive dynamics for the UCaaS and CCaaS providers. Currently, businesses are using multiple cloud communication companies; I’ve seen data that suggests the average enterprise has five or more providers. It’s common to see a scenario where Teams, Zoom, RingCentral, Webex, and NICE are all deployed. I don’t think anyone would argue that consolidating has a financial benefit, as organizations are likely paying for redundant capabilities. The bigger questions are: do you go to a single vendor or keep multiple ones? What are the anchor services that determine which ones are “must-haves?” Answering those questions isn’t easy. I believe few companies of significant size will go to one vendor. For the rest, businesses need to consider which application is the anchor and decide from there. For example, chat has become one of the most important applications, which is one of the things Teams does well, so companies continued to deploy Teams despite its deficiencies in other areas, such as calling. For the other vendors, their perceived core capability is what they came to market with. For RingCentral, it's calling, and for Zoom, it’s video, even though the former has made great strides in video and vice versa. This happens when a vendor has so much success doing one thing that no one looks to them for anything else. As RingCentral and its peers embark on their “expand” strategy, they must showcase their strength in these new areas. The best way to do this is through customer examples. I liked how the company specifically called out some RingCentral Event wins, but I would like to see more of this as people generally will be skeptical about a capability once you prove you can do it. I recall a conversation with Shmunis when the company started putting up bigger wins a few years ago. He told me something to the effect of, “No one thought we could do 5000 seats - until we did. Then people said we couldn’t do 10,000, and then we did.” Coming out of this quarter, the conservative guide was prudent, and now it comes down to executing and growing its ARR outside of its core business.

For businesses, decisions about investing in AI are complex and challenging.

Artificial Intelligence (AI) is reshaping business operations, from network troubleshooting and cybersecurity to customer service and communications. As investment in AI reaches new heights, organizations must weigh its benefits against cost, environmental impact, ethical concerns, and implementation challenges. The global system integrator World Wide Technology (WWT) recently hosted a tech talk with leaders from Cisco, Intel, and NetApp to discuss key considerations for adopting AI in business. They examined various AI investment options and outlined an effective AI investment strategy. This included ways to address the skills gap in AI, and tactics for incorporating security and sustainability into an AI strategy. Here are the key takeaways from that discussion.

Transforming Operations & Enhancing Security/Privacy With AI Investment

The impact of artificial intelligence on operational efficiency and security is significant, and its applications are diverse. Cisco leverages AI in security through predictive analytics and pattern recognition. This application of AI allows Cisco to identify potential cyber threats before they can cause harm proactively. By analyzing data patterns and detecting anomalies, Cisco’s AI-driven security approach enables faster response times and improved threat mitigation in networking. NetApp focuses on AI’s ethical use and deployment to enhance security, particularly in protecting intellectual property (IP) and sensitive data. The company prohibits using public generative AI services within the internal network, having developed its own secure version. This ensures NetApp data, as well as that of its clients, remains protected. “Looking at Twitter, Facebook, and Instagram, I fear that AI can be weaponized,” said Paras Kikani, senior director of solutions engineering at NetApp. “So, we have to be responsible and ensure that we’re not only implementing AI the right way but also protecting ourselves simultaneously. The IP that you all hold just can’t go into the public domain.” Intel works with partners to develop large domain-specific language models tailored to specific industries like finance, healthcare, and manufacturing. The goal is to make AI intuitive and practical, focusing on real-world problems and areas where customers genuinely need solutions. For example, Boston Consulting Group (BCG) and Intel have teamed up to create an AI model trained on BCG’s confidential data, spanning over 50 years. BCG employees can now retrieve and summarize information that was previously difficult to find using a chatbot powered by Intel AI hardware and software while keeping the data private. Cisco is also cautious, advising against the use of public generative AI services. For instance, Cisco has its own internal AI platform leveraging Microsoft’s Azure AI capabilities. This reflects a broader trend Cisco observed among its customers. Financial services firms tend to be wary of AI, whereas manufacturing companies are more open to it. Cisco believes providing employees with viable, secure alternatives to public AI tools is essential. “You can’t say no,” said Eric Knipp, Cisco’s vice president of systems engineering, Americas. “Just like with security, they will find ways around it if you make it hard. Versus giving them a tool that they can work with, backed up by your own internal policies.”

Sustainability & Cost Considerations for Deploying AI

Industry leaders are deeply aware of the sustainability challenges, notably the high energy consumption associated with generative AI. It requires extensive floor space and cooling in an era where there is a trend toward reducing power usage and creating smaller, hybrid environments. Organizations risk being overly enthusiastic about AI investment, leading them to adopt it without fully understanding its purpose or impact on the environment. An AI investment strategy must therefore consider sustainability and cost-efficiency. “GenAI is not exactly a green technology. A ChatGPT search takes about 100 times more power than a typical Google search. As we think about driving these types of solutions into our customers’ environments or into our enterprise environments, we need to be cognizant of the potential impact that’s going to make,” said Knipp. AI implementation is costly due to the need for high-end graphics processing units (GPUs), high-performance storage, and extensive datasets. Balancing these expenses puts more strain on already tight IT budgets. According to Kikani, AI must prove its value in “helping the core business” by generating revenue, fueling growth, reducing risk, cutting costs, or optimizing resource use. It’s important to thoroughly understand AI, including its intended purpose and how to use it most efficiently, effectively, responsibly, and securely. “Everybody is so enamored with AI that we’re getting ahead of ourselves without really understanding what AI is. It’s a tool. It’s a hammer, it’s a nail. It’s not going to replace everything,” said Travis Palena, Intel’s global channel sales director for data center and AI.

Future Workforce: Bridging the Skills Gap

People who have spent years in specific roles must now adapt to new demands and technologies, as evidenced by the recent layoffs at major tech companies. Cisco, Intel, and NetApp acknowledge an industry-wide need for apprenticeship programs, internships, and educational initiatives to help foster the next generation of tech-savvy professionals. NetApp, for example, has a program called Sales, Support and Services (S3) Academy, which provides training to recent college graduates and those with a few years of experience. However, NetApp also recognizes the importance of continuous learning for midcareer professionals to succeed in today’s fast-paced tech world. “As our corporate responsibility, we need to build programs to not only help our early career individuals but also people who have been in industry for five to 10 years and haven’t had a chance to learn something new,” said Kikani. Cisco is approaching the skills gap by leveraging its existing Network Academy program to recruit people who may not have a four-year degree but can learn relevant tech skills. This initiative reflects a broader perspective on talent acquisition and the value of looking beyond conventional four-year degree holders. The Department of Defense’s SkillBridge is an example of a program that helps veterans transition to corporate jobs. Cisco has recruited more than 120 veterans through this program so far.

Bottom Line: AI Investment

The decisions about investing in AI are complex and challenging. But by focusing on early-career individuals, nontraditional talent pools, and veterans, organizations have the opportunity to broaden their recruitment strategies and invest in the current workforce to meet the challenges of rapidly evolving technologies like AI.

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