|By John Savageau||
|January 5, 2010 04:00 PM EST||
Bjarni Thorvardarson is a rare telecom visionary. He thinks on a level of telecoms at an intercontinental level, rather than a national or local level. Hibernia Atlantic is his current project, and with recent news that the submarine and terrestrial cable system is now in the global media distribution business, he is shaking up the telecom community. An Icelandic native, he has brought his knowledge and skills to the United States, basing Hibernia Atlantic in Summit, New Jersey.
Pacific-Tier: Bjarni, what's been happening with Hibernia Atlantic in the past few years, since I had my last opportunity to visit with you?
Bjarni Thorvardarson: We've actually had a busy couple years – a very busy couple of years.
As you may recall, we started this business by buying a submarine asset that was formerly owned by 360 Networks. We've been busy trying to build our terrestrial network to try and connect this submarine cable to anywhere. We no longer refer to ourselves as simply a submarine cable, but rather a capacity provider in the eastern North America region and in Europe. Less than half of our business is now in trans-Atlantic capacity.
Even though that remains our core competence, and the core of our business, in terms of our business it is less than half of our revenue.
So that is part of the transformation that has happened over the past few years.
In terms of revenue, in 2005 we generated about $2 million in revenue, then $7 million, the $18 million the following year, then $28 million, and last year we generated about $38 million dollars.
And now the target for 2010, with our addition of MediaXstream, is about $75 million dollars in revenue. So, we've been growing about 40~50&, up to 80 or 90% a year. So you see it's a very rapid growth. We are riding on a couple things. One is that we are operating in the biggest capacity market in the world, which is the Northeastern part of North America and Europe. And we are focused on a niche sector, which is the big bandwidth market – which is by itself growing about 40% in volume terms a year
And now, since we still have a relatively small market share, we are growing even faster than the other (traditional) markets (players). That's how we've been successfully growing our revenues.
Last year, in 2009, we were confident for the first time, and we were profitable. We are very happy with the way things are going.
Pacific-Tier: That's excellent! Can you tell me a little about yourself, and how you got into the business of both submarine and terrestrial bandwidth and capacity?
Bjarni Thorvardarson: Sure. I've been in the IT and telco business for about 17 years since I finished my business studies. By education I have a degree in engineering from the University of Wisconsin (At Madison). Later on I added a science degree from the London Business School.
I went into the telecommunications business, and from there into investment banking (around 1998). Then shortly thereafter I started a fund that was investing in telecommunications and IT. That was 1999 into 2001. From there Ken Peterson actually got interested, Ken Peterson was the owner of Columbia Ventures (CVC), got into an investment in telecommunications. He brought a co-investor in with me, and bought the fund eventually. That's how it came about that I started working for CVC.
And I've been investing on their behalf in telecommunications since 2002.
Now one of the investments that we had made was indeed Hibernia Atlantic. That was 2003. Then in 2004 we sold an investment that I was responsible for here in Ireland. Then I took over the responsibility of Hibernia Atlantic. Since 2005 I have been with Hibernia Atlantic, running it for CVC.
That's how it came about that I've been investing and spending my time in telecommunications.
When it came that I was to take on the Hibernia Atlantic project, it was meant to be a 6 month project. We'd see what we could do, fix a couple things, and recruit the right people. It's one of those things that a 6 month window turned into a sliding 6 month window. And during the next 6 months we ended doing something exciting. That's what happens when you get interested in what you are doing.
You see the potentiality, you see what can be done, and you kind of stick around – and so its 5 years now. I no longer refer to it as my 6 month project, I now refer to it as my passion. It's what I do. I've been commuting between Ireland and the US now for the better part of 5 years, and relocated to New Jersey where we have the Summit headquarters, or US headquarters a few years ago. So I am pretty heavily enrolled in the Hibernia project.
Pacific-Tier: That's good. You mentioned earlier the topic of moving from telephony to broadband. Where does Hibernia and your plans fit into what I would call the "globalization of communications," or the "flattening of the communications architecture…" How do you fit into that model?
Bjarni Thorvardarson: Hibernia is very much a long-haul provider. We started in the long-haul wholesale capacity business, so provided the infrastructure provider to other service providers – the likes of BT and France Telecom, Cogent and the like… We did a very good business connecting the biggest consumer markets to places like New York, London, Amsterdam, Chicago, connecting those markets and enabling service providers in those markets to connect to different parts of the world.
Our business is really predicated, it is built on the globalization of business, or the globalization and international movement of information. That was the core part of our business model.
Now since then we have moved on to going up the value chain (if you like) to become the service provider to enterprises ourselves, and begin focusing on the finance vertical, which is a very demanding market. They (financial markets) are demanding and expecting low latency circuits between different trading markets and centers. That was a big first step into the enterprise world.
The next step we took was to the media sector, which we did first when we were acquainted with or partnered up with MediaXtreme, investing in MediaXstream a couple years ago. Then finally culminated in the acquisition of MediaXstream last month. So that's our big step into the media market.
So now Hibernia's approach to the market is threefold:
- We are still very much the legacy we started, which is the wholesale provider to other service providers and telcos around the world
- Second is the finance sector
- Third is the media sector
But they all are very much relying on the globalization of business and people's general view of the world. So we have to look and depend on it.
Pacific-Tier: So in a traditional sense submarine and terrestrial long-haul networks relied on SONET or SDH technologies as the basic (communications) protocol. Is Ethernet playing a stronger role in anything Hibernia is doing now?
Bjarni Thorvardarson: We started providing waves (2.5 or 10 Gigabit) via SDH and SONET as a product to the wholesale sector. For technical reasons including that was the technology Hibernia was built on. And also that was the product the wholesale providers relied on. They need to connect their different POPs (Point of Presence) equipment. A POP in New York, to a POP in London, that equipment relied on and called for SDH/SONET to connect the POPs.
Now as we grow into the enterprise sector, then the guys, the traders, or whoever we are doing business with – they don't have SONET or SDH equipment. They have Ethernet equipment or equipment that calls for Ethernet protocols. So it is incumbent on us to be able to provide that without cumbersome translation from one protocol to another.
So we have since built Ethernet at the core of our protocols. Now we can offer Ethernet over SONET, which is dedicated Ether net point-to-point. And we also built, using H3C equipment, a product that we can connect customer to and point-to-point to multipoint capacity.
So moving from the SONET/SDH world to the Ethernet world, or switched Ethernet is very much what we are doing. I am right with you there that we are phasing out one world and moving to another one. Even the telco providers are increasingly moving into the Ethernet world. Especially when it comes to building out their ISP or Internet networks.
Pacific-Tier: When you see organizations like the Carrier Ethernet Neutral Exchange (www.cenx.com) and things like that popping up that are basically designing their product on the old bilateral telecommunication company design… Do you believe that bilateral Ethernet, or that bilateral carrier relationships still have a role, or will companies like Hibernia make many of those old relationships irrelevant?
Bjarni Thorvardarson: Hibernia, in its traditional sense, is not going to replace bilateral agreements. But bilateral agreements are going to be phased out when it comes to the exchange of Internet traffic, because exchanges are going to replace them. It is like the minutes (telephone settlement) business extremely cumbersome. If you want to build a bilateral relationship with other telecommunications providers you want to exchange traffic with through some of the voice exchanges you can do business in a matter of days.
And that is the same with the exchange of Internet traffic. If you want to do peering on a bilateral basis with companies it takes you years to build up. If you want to do it through an intermediary (such as a public internet exchange Point), clearly it is moving from the bilateral agreements to the exchanges.
Now how does that related to the price a carrier has to pay when going through the exchanges? To transit pricing? Or what have you?
And we can see where these intermediaries are actually charging less and less for the service of being in-between the delivery of the data and the content origination. You can see that in transit pricing, and how transit pricing is continuing to plummet. So I think that we are becoming less reliant on the bilateral agreement. And I firmly believe the opportunity and the necessity of getting more exchanges up and running is important.
And I think the same transition, you can see the same transition when it comes to not only Internet peering, Internet traffic is also the interconnection of Ethernet circuits, the same transition occurred that we saw 50, 60, 70 years ago when it came to voice traffic. If you wanted to make a call from London to New York you had to call an operator in London, and he made a physical cross connect to a long-distance line that terminated in New York.
The operator in New York then made the physical transition to the local tail line to the customer in New York.
That's very much the same as when you are setting up an Ethernet circuit today. You have to build up a physical cross-connect in New York between the local tail provider and the Hibernia facility, and then in London to the tail provider over there.
With INNs and with proper Ethernet virtual cross-connects which are relying on a virtual exchange, or like exchanges that you are referring to, it's going to revolutionize the provisioning and setup time of these Ethernet circuits. We can see a leap in that direction over the next couple years.
Pacific-Tier: One other thing I'd like to ask about Hibernia's role in the Internet and international community in particular. I've been spending a lot of time in developing countries myself over the past year or so. So does Hibernia play a larger role, more than just an economic role,.. Do you also have a larger role in supporting the global community to provide a product that will bring global communications, education, entertainment, media, - can you bring that type of thing to another level?
Bjarni Thorvardarson: I think that when you have a major company, a large company on the global economic scale, then you have to sit back an think about what your global social responsibility is to the world, and what you can contribute to the world. Hibernia is light years away from being at that size, and we can best fulfill our role now by looking for what is our economical role in this world.
Today that role is to provide large scale, high interconnectivity in all the market we operate in at a very attractive price. And by doing that we can contribute to the successful globalization commerce that will facilitate the business which will break down barriers that might prevent doing business, or from offering access to multinational companies.
That's really what I think is our role in the world, to enable companies and people around the world be operating seamlessly as if they were sitting at two desks right next to each other (companies), and thus taking away the physical barriers of being located thousands of miles apart.
Pacific-Tier: If you look at the ideas, of say Carr's concept of the "Big Switch" (Nicholas Carr), where telecom companies, and computing companies, and storage companies actually become nothing more than a huge, ubiquitous utility that people expect. Do you agree with that idea, or do you believe companies like Hibernia should be able to offer much higher value than the idea of a utility "big fat pipe?"
Bjarni Thorvardarson: Well I think everyone has to know which business they are in, and that people can be in more than one business at a time. I say that from experience, because CVC (his prior venture capital company) was in the manufacturing of aluminum, and the manufacture of advanced products that were made from aluminum.
Making or smelting aluminum is very much a commodity business. The success of the business is predicated, or based on you operating a business efficiently. It's about cost, cost, and cost. If the price per pound of aluminum that you smelt is higher than your competitors, you are out of the market. So that's how we operated in the aluminum market.
But we also had exclusion companies. That is changing the aluminum ingot to bars that can be used by manufacturers, and be converted to door frames, and window frames, and converted into materials that could be sold to the end users or consumers.
So we were very much aware of the different needs of the value-added service market and the commodity market.
And I think the telecom business is very much the same. You have to know whether you are in the commodity market, the utility market, and there is a fair amount of utility market in the telecommunications world. I think the core of what Hibernia does is just that. It is a utility capacity between the POPs. It is providing 10G (Gigabit) capacity between London and New York, or London and Amsterdam, connecting all these high capacity markets, and it is a utility market.
You have to be very efficient in terms of how you operate your market.
Then, when you go up to the media market, or to the finance market, it is no longer a commodity market. The trader that is trading between London and New York, he does care about the price he is paying, but even more concerned with no having a second-rate service.
So you have to know which market you are operating in, and telecommunications will remain within the two markets.
Now Nicholas Carr's concept or theory of the "Big Switch" where the world is going to cloud computing as a utility, where you plug into a socket in the wall and you are connected to a network of computing power is a noble one, and a very interesting one, and I think it certainly is going in that direction, but the difference between the bits and bytes, and the electrons that flow on the wires of the utility companies or the electric companies – it is bits and bytes of sensitive information that you do not want leaving the company or be flowing on the wires outside of the company.
So there are many challenges the "Big Switch" theory or concept. But there are a number of companies that are building up a very successful business model. Amazon being one, and a number of other companies offering cloud computing and growing extremely fast.
I am fascinated by the concept and the model of business, but I don't think there is quite the pure cut between computing and the traditional utilities.
Pacific-Tier: Any other vision or looks into the future Hibernia may be able to share as you peer into the next 3 to 5 years?
Bjarni Thorvardarson: I wish I could pretend to have a crystal ball, and say what our visions are, but our vision, really for the near to mid-term future is to continue our growth into the different enterprise verticals. We need to continue to service the market we comfortably define as our core markets, being North America and Europe. That's where we will continue to focus our attention.
But we will to some extent continue to introduce new products that will leverage our network, and continue focusing on different verticals that we can also continue leveraging the network. The game for Hibernia over the next couple years is leveraging the asset. Those assets are not only our network, but also the experience of our company (employees) – the people we have, the processes, and the systems we have. Our competence and the network – that is what Hibernia is going to be not only for the next few years, but beyond.
Pacific-Tier: Do you see any potential partnerships or expansion across other parts of North America or into Asia at some time in the future?
Bjarni Thorvardarson: Without any doubt, I am sure we will find partnerships that will benefit both parties, but it is nothing I can speak about or speculate about right now.
Pacific-Tier: Fair enough! Any final words on Hibernia, yourself personally, or what you see as interesting things happening in the market?
Bjarni Thorvardarson: Not really, I am just enjoying working in this space, and I'm looking at a number of exciting opportunities. M&A opportunities, growth opportunities, and I am just excited to be here.
Pacific-Tier: As we all are, and thank you very much for your thoughts – it has been a great discussion.
Thank you! It is my pleasure!
|Mr. Bjarni Thorvardarson has been the CEO of Hibernia Atlantic since January 2005. He joined CVC, Hibernia's parent company, in 2002 from ISB bank where he launched and managed the listed Talenta-Technology fund which focused on emerging communication and IT opportunities. Prior work experience includes investment banking at FBA bank, management of an MIS department and European Sales Director of an IT company. Thorvardarson holds an M.Sc. degree in Engineering from UW-Madison, an MBA from ISG in Paris and an M.Sc. in Finance from London Business School.|
@ThingsExpo has been named the Top 5 Most Influential M2M Brand by Onalytica in the ‘Machine to Machine: Top 100 Influencers and Brands.' Onalytica analyzed the online debate on M2M by looking at over 85,000 tweets to provide the most influential individuals and brands that drive the discussion. According to Onalytica the "analysis showed a very engaged community with a lot of interactive tweets. The M2M discussion seems to be more fragmented and driven by some of the major brands present in the...
Oct. 28, 2016 09:15 AM EDT Reads: 11,621
In his general session at 19th Cloud Expo, Manish Dixit, VP of Product and Engineering at Dice, will discuss how Dice leverages data insights and tools to help both tech professionals and recruiters better understand how skills relate to each other and which skills are in high demand using interactive visualizations and salary indicator tools to maximize earning potential. Manish Dixit is VP of Product and Engineering at Dice. As the leader of the Product, Engineering and Data Sciences team a...
Oct. 28, 2016 08:00 AM EDT Reads: 914
Personalization has long been the holy grail of marketing. Simply stated, communicate the most relevant offer to the right person and you will increase sales. To achieve this, you must understand the individual. Consequently, digital marketers developed many ways to gather and leverage customer information to deliver targeted experiences. In his session at @ThingsExpo, Lou Casal, Founder and Principal Consultant at Practicala, discussed how the Internet of Things (IoT) has accelerated our abil...
Oct. 28, 2016 08:00 AM EDT Reads: 3,522
19th Cloud Expo, taking place November 1-3, 2016, at the Santa Clara Convention Center in Santa Clara, CA, will feature technical sessions from a rock star conference faculty and the leading industry players in the world. Cloud computing is now being embraced by a majority of enterprises of all sizes. Yesterday's debate about public vs. private has transformed into the reality of hybrid cloud: a recent survey shows that 74% of enterprises have a hybrid cloud strategy. Meanwhile, 94% of enterpri...
Oct. 28, 2016 08:00 AM EDT Reads: 5,089
SYS-CON Events announced today that Streamlyzer will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Streamlyzer is a powerful analytics for video streaming service that enables video streaming providers to monitor and analyze QoE (Quality-of-Experience) from end-user devices in real time.
Oct. 28, 2016 07:15 AM EDT Reads: 1,119
You have great SaaS business app ideas. You want to turn your idea quickly into a functional and engaging proof of concept. You need to be able to modify it to meet customers' needs, and you need to deliver a complete and secure SaaS application. How could you achieve all the above and yet avoid unforeseen IT requirements that add unnecessary cost and complexity? You also want your app to be responsive in any device at any time. In his session at 19th Cloud Expo, Mark Allen, General Manager of...
Oct. 28, 2016 07:15 AM EDT Reads: 1,119
Established in 1998, Calsoft is a leading software product engineering Services Company specializing in Storage, Networking, Virtualization and Cloud business verticals. Calsoft provides End-to-End Product Development, Quality Assurance Sustenance, Solution Engineering and Professional Services expertise to assist customers in achieving their product development and business goals. The company's deep domain knowledge of Storage, Virtualization, Networking and Cloud verticals helps in delivering ...
Oct. 28, 2016 07:00 AM EDT Reads: 1,172
Intelligent machines are here. Robots, self-driving cars, drones, bots and many IoT devices are becoming smarter with Machine Learning. In her session at @ThingsExpo, Sudha Jamthe, CEO of IoTDisruptions.com, will discuss the next wave of business disruption at the junction of IoT and AI, impacting many industries and set to change our lives, work and world as we know it.
Oct. 28, 2016 07:00 AM EDT Reads: 594
SYS-CON Events announced today that 910Telecom will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. Housed in the classic Denver Gas & Electric Building, 910 15th St., 910Telecom is a carrier-neutral telecom hotel located in the heart of Denver. Adjacent to CenturyLink, AT&T, and Denver Main, 910Telecom offers connectivity to all major carriers, Internet service providers, Internet backbones and ...
Oct. 28, 2016 07:00 AM EDT Reads: 3,770
The IoT industry is now at a crossroads, between the fast-paced innovation of technologies and the pending mass adoption by global enterprises. The complexity of combining rapidly evolving technologies and the need to establish practices for market acceleration pose a strong challenge to global enterprises as well as IoT vendors. In his session at @ThingsExpo, Clark Smith, senior product manager for Numerex, will discuss how Numerex, as an experienced, established IoT provider, has embraced a ...
Oct. 28, 2016 06:45 AM EDT Reads: 1,269
Cloud based infrastructure deployment is becoming more and more appealing to customers, from Fortune 500 companies to SMEs due to its pay-as-you-go model. Enterprise storage vendors are able to reach out to these customers by integrating in cloud based deployments; this needs adaptability and interoperability of the products confirming to cloud standards such as OpenStack, CloudStack, or Azure. As compared to off the shelf commodity storage, enterprise storages by its reliability, high-availabil...
Oct. 28, 2016 06:15 AM EDT Reads: 1,310
DevOps is being widely accepted (if not fully adopted) as essential in enterprise IT. But as Enterprise DevOps gains maturity, expands scope, and increases velocity, the need for data-driven decisions across teams becomes more acute. DevOps teams in any modern business must wrangle the ‘digital exhaust’ from the delivery toolchain, "pervasive" and "cognitive" computing, APIs and services, mobile devices and applications, the Internet of Things, and now even blockchain. In this power panel at @...
Oct. 28, 2016 06:00 AM EDT Reads: 2,200
The Quantified Economy represents the total global addressable market (TAM) for IoT that, according to a recent IDC report, will grow to an unprecedented $1.3 trillion by 2019. With this the third wave of the Internet-global proliferation of connected devices, appliances and sensors is poised to take off in 2016. In his session at @ThingsExpo, David McLauchlan, CEO and co-founder of Buddy Platform, discussed how the ability to access and analyze the massive volume of streaming data from millio...
Oct. 28, 2016 05:00 AM EDT Reads: 3,202
In the next forty months – just over three years – businesses will undergo extraordinary changes. The exponential growth of digitization and machine learning will see a step function change in how businesses create value, satisfy customers, and outperform their competition. In the next forty months companies will take the actions that will see them get to the next level of the game called Capitalism. Or they won’t – game over. The winners of today and tomorrow think differently, follow different...
Oct. 28, 2016 04:15 AM EDT Reads: 1,166
“Media Sponsor” of SYS-CON's 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. CloudBerry Backup is a leading cross-platform cloud backup and disaster recovery solution integrated with major public cloud services, such as Amazon Web Services, Microsoft Azure and Google Cloud Platform.
Oct. 28, 2016 04:15 AM EDT Reads: 1,566
According to Forrester Research, every business will become either a digital predator or digital prey by 2020. To avoid demise, organizations must rapidly create new sources of value in their end-to-end customer experiences. True digital predators also must break down information and process silos and extend digital transformation initiatives to empower employees with the digital resources needed to win, serve, and retain customers.
Oct. 28, 2016 02:45 AM EDT Reads: 1,798
SYS-CON Events announced today that SoftNet Solutions will exhibit at the 19th International Cloud Expo, which will take place on November 1–3, 2016, at the Santa Clara Convention Center in Santa Clara, CA. SoftNet Solutions specializes in Enterprise Solutions for Hadoop and Big Data. It offers customers the most open, robust, and value-conscious portfolio of solutions, services, and tools for the shortest route to success with Big Data. The unique differentiator is the ability to architect and ...
Oct. 28, 2016 02:30 AM EDT Reads: 1,201
You think you know what’s in your data. But do you? Most organizations are now aware of the business intelligence represented by their data. Data science stands to take this to a level you never thought of – literally. The techniques of data science, when used with the capabilities of Big Data technologies, can make connections you had not yet imagined, helping you discover new insights and ask new questions of your data. In his session at @ThingsExpo, Sarbjit Sarkaria, data science team lead ...
Oct. 28, 2016 02:00 AM EDT Reads: 4,401
A completely new computing platform is on the horizon. They’re called Microservers by some, ARM Servers by others, and sometimes even ARM-based Servers. No matter what you call them, Microservers will have a huge impact on the data center and on server computing in general. Although few people are familiar with Microservers today, their impact will be felt very soon. This is a new category of computing platform that is available today and is predicted to have triple-digit growth rates for some ...
Oct. 28, 2016 02:00 AM EDT Reads: 34,378
In past @ThingsExpo presentations, Joseph di Paolantonio has explored how various Internet of Things (IoT) and data management and analytics (DMA) solution spaces will come together as sensor analytics ecosystems. This year, in his session at @ThingsExpo, Joseph di Paolantonio from DataArchon, will be adding the numerous Transportation areas, from autonomous vehicles to “Uber for containers.” While IoT data in any one area of Transportation will have a huge impact in that area, combining sensor...
Oct. 28, 2016 01:00 AM EDT Reads: 1,220