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China Unicom Gains Competitive Edge in Enterprise Private Line Market Based on Optical Service Networks

China Unicom has long been committed to building top-quality enterprise private line networks. Through its strategic cooperation with Huawei, the operator has launched a global top-quality enterprise private line network based on its OTN. This network features wider coverage, lower latency, stronger assurance, and better experience, making it suited for important customers such as government organizations, financial institutions, and enterprises.

By Tang Xiongyan, Chief Scientist of China Unicom's Network Technology Research Institute

With the advent of the 5G commercial era, the pace of digital transformation is accelerating in all aspects of both society and the economy, driving parallel development of the entire ICT industry and digital economy and revolutionizing the communications industry. Carriers worldwide are reconstructing their devices, networks, services, and operations to address various challenges in the digital era. Likewise, China Unicom is reshaping its open network architecture to support the evolution of optical networks from transport networks into service networks, facilitating the digital transformation of enterprises.

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Digital Transformation Drives China Unicom's B2B Service Upgrade

With the digital transformation of enterprises and the proliferation of Internet Plus services, the ICT industry has gained significant development opportunities and a huge market space. China's digital economy is now worth CNY2.72 billion, accounting for 32.9% of its GDP and maintaining a compound annual growth rate (CAGR) of 18.9%.

The existence and development of the digital economy require the support of transport networks, and cloud-network synergy is the key to the transformation of transport networks. The cloudification of enterprise services will trigger the emergence of various digital applications that require one-stop quick provisioning and higher security. In addition, transport networks must support flexible deployment, on-demand adjustment, millisecond-level latency, minute-level provisioning, pipe visualization, and high security and reliability for scheduling of cloud services.

To fully meet user requirements for cloud service access and networking in the digital era, China Unicom attaches great importance to the cloud-network synergy strategy, consistently placing it as the focus of network and service development. In 2015, China Unicom released its CUBE-Net 2.0 network transformation white paper, deployed a centralized management and control system to build intelligent networks, established a new cloud+network ecosystem through cloud-network synergy, and reconstructed Internet applications. In line with the cloud-network synergy strategy, China Unicom has been developing one-stop "cloud+network" services and implementing fast deployment, elastic bandwidth, and performance visualization to provide a wide portfolio of cloud applications and enhance its competitiveness in the 2B domain.

Optical Service Networks Enable China Unicom's Innovation in Enterprise Private Line Products

Cloud-network synergy drives the rapid development of optical service networks. As a type of infrastructure network, optical networks have long functioned as a bottom-layer transmission platform. For this reason, the basic attributes of optical networks are highly important, and the network evaluation focus is placed on technical and maintenance indicators such as bandwidth and availability. And with the proliferation of cloud-network synergy services, the service attributes of optical networks become increasingly important. That is, optical networks are built and evolve to address the service needs of government and enterprise customers, and the network evaluation focus is shifted to service and economic indicators.

Among all service traffic transmitted over China Unicom's backbone network, the proportion of Internet traffic keeps declining. This trend is in contrast to the service traffic from OTT players and government and enterprise customers, which is increasing significantly. In addition, transmission private lines feature high bandwidth and rapid growth, and optical service networks are becoming increasingly important. Nowadays, carriers are suffering slow development of traditional services, with stagnant growth or even a decline in the customer base. So, what should carriers do to generate new revenue streams? One option is to tap into the private line market. With the digital transformation of enterprises, the private line bandwidth is constantly increasing, and the market scale of enterprise private lines is expanding. In addition, private lines can help carriers expand the scale of their services. According to third-party statistics, a mere 5% of private line services can generate 20% of a carrier's enterprise revenue.

Traditional DDN/FR/ATM data private lines have been gradually phased out, while Ethernet private lines have been growing the fastest. In addition, the rate of private lines is continually increasing, for example, up from 2 Mbit/s or lower to 50 Mbit/s or higher. As well as this, large Internet companies are increasingly demanding ultra-high bandwidth (10 Gbit/s or higher) private lines. In addition to high bandwidth, private line customers also require higher quality and faster deployment. In particular, high-end enterprise customers focus more on the quality of private lines, for example, the latency of financial private lines. Also, when it comes to the speed and flexibility of private line services, such as fast provisioning, real-time bandwidth adjustment, and short-term leasing, customers have increasingly high requirements. The trend of enterprise cloudification fuels vast demand for private lines, and drives an increase in the types of private lines. In addition to rigid private lines, price-sensitive enterprises have gradually come to accept private line services provided over IP/PON networks.

As optical networks evolve from transport networks into service networks, there are several important evolutionary trends for optical service networks. The first is bandwidth acceleration, with the technical system changed from MSTP to larger-granularity OTN and ROADM. The second is intelligent operations, with SDN and AI introduced to improve efficiency. The third is service integration, with carriers committed to building an end-to-end (E2E) integrated service system. The fourth is diversified access modes, such as PON, MSTP, and OTN. The final one is cloud-network synergy and cloud-based network resource migration, with private line products able to be tailored to customer needs and flexibly adjusted.

In light of this expanding high-value market, China Unicom provides a wide portfolio of networking private lines and cloud access products, such as ROADM-based wavelength-level private lines (100 Gbit/s or higher), OTN-based high-bandwidth rigid private lines (10 Mbit/s to 100 Gbit/s), IP RAN-based intelligent elastic private lines (less than 1 Gbit/s), PON-based Internet private lines (less than 1 Gbit/s), IP transport network-based private lines/VPN services, and Internet overlay-based SD-WAN. These products can meet the differentiated requirements of enterprise customers.

Regarding the backbone network, China Unicom has deployed a ROADM network around the Beijing-Tianjin-Hebei region to provide wavelength-level private line services. This network leverages ROADM to implement multi-directional networking, and enables the ASON function to implement E2E automatic provisioning and dynamic adjustment of services, providing wavelength-level, flexible private line services.

China Unicom Accelerates the Upgrade of Top-Quality Enterprise Private Line Networks

China Unicom has long been committed to building top-quality enterprise private line networks, and was the first to roll out its top-quality financial network in 2018. It leverages the intelligent OTN to offer the industry's best enterprise private line network, thereby addressing the networking requirements of important customers such as government organizations, finance institutions, and large enterprises. In 2019, through further strategic cooperation with Huawei, China Unicom launched a global top-quality enterprise private line network. This network features wider coverage, lower latency, stronger assurance, and better experience, making it suited for important customers. The features of the network are depicted as follows:

  • Wider coverage: This network covers international cities on six continents and focuses on the network construction requirements of 17 international cities. In addition, the network provides in-depth coverage for national strategic development areas such as the Beijing-Tianjin-Hebei region, Bohai Rim, Yangtze River Delta, and Guangdong-Hong Kong-Macao Greater Bay Area in China.
  • Lower latency: Due to a flat network architecture, services are reachable between any two points in an E2E manner, and optimal short paths are available. As a result, 1 ms latency circles are built in core strategic development areas, and 2 ms/3 ms latency circles are built in developed economic areas.
  • Stronger assurance: The network is an intelligent 3D mesh network, with availability of up to 99.999%.
  • Better experience: The network provides an e-commerce-like management experience and implements self-service handling, on-demand acceleration, and service SLA monitoring, effectively enhancing O&M efficiency.

Since its roll-out, China Unicom's top-quality enterprise private line network has attracted wide attention and recognition from government and enterprise customers, and achieved desirable market outcomes in just a short time. Past experience shows that high-quality products and E2E management and services are carriers' core competitiveness, and the key lies in SDN management and control capabilities. China Unicom's top-quality enterprise private line network is aimed at building an E2E, integrated, and best-in-class private line network (L0 to L2 private lines) both in and outside China.

The network adopts an open management and control architecture. Vendors' management and control platforms can not only manage their own devices, but also be interconnected with the upper-layer OSS. The orchestrators at the middle layer have two levels: The group is responsible for cross-province service scheduling, and international, inter-provincial, and provincial branches are responsible for service provisioning in their own domains. The unified operations platform at the top layer is responsible for service orchestration, authentication, and charging. It connects to the group-level orchestrator through standard interfaces, and implements flexible, on-demand scheduling of private line services through an E2E management control system.