Summary Bullets:

• The arrival of Console Connect in Australia fleshes out PCCW’s software-defined infrastructure offerings in the market, although integration of some features is still lacking.
• Software-defined interconnect (SDI) is not new to Australia, and PCCW faces existing competition; however, the company is well positioned to manage cross Australia-to-China workloads.

PCCW’s expansion of the Console Connect platform into Australia is a positive move for the company. PCCW already offers its SD-WAN services (Viptela and VeloCloud) in the country. The addition of its cloud-focused Console Connect to the portfolio of networking services available in the country will complement its SD-WAN offering by giving enterprise customers more visibility and control over bandwidth and performance as enterprise workloads are increasingly hybrid and multi-cloud. Software-defined networking and cloud interconnect are high-growth areas within the Australian market. According to “GlobalData Market Opportunity Forecasts to 2024: ICT in Australia” (February 21, 2020), spend on SD-WAN is expected to grow at a five-year CAGR of 19.6% to reach USD 114 million, while enterprise spend on cloud management platforms will grow at a five-year CAGR of 16.6%, reaching USD 526 million.

PCCW is not the first player in the Australian market to offer SDI; local player Telstra offers similar capabilities through its Telstra Programmable Network (TPN) as well as through its partnership with Equinix to access its ‘Cloud Fabric Exchange’ data center interconnect platform. Brisbane-headquartered Megaport offers cloud interconnect through its Megaport SDN, and global players like NTT and Verizon are also in the market with SDI solutions. However, PCCW has some differentiators. The company is particularly strong in supporting Chinese-focused enterprises, with direct connections available not only to Alibaba Cloud, but also to Tencent Cloud and QingCloud. PCCW will be well positioned to deliver inbound services to Chinese enterprises looking to expand operations into Australia as well as outbound services for enterprises in Australia looking to expand into China. This is a core focus for Alibaba Cloud’s services, one of PCCW’s leading cloud partners. Furthermore, PCCW also announced the integration of Console Connect into the Internet Association of Australia’s IX Australia internet peering exchange, which will help reduce latency and IP transit costs for customers within Australia.

While PCCW’s Console Connect and SD-WAN offer powerful tools for enterprises to implement software-defined architecture across their networking and cloud environments, the two solutions, though they have the ability to integrate, are sold separately. Moreover, while Console Connect’s integration appears to be on track, historically it was operating in a separate business unit from PCCW Global, which offers the SD-WAN service. Comparatively, Telstra’s TPN offers a single view across the WAN, data center, private, and public cloud and even offers an NFV marketplace as part of its software-defined infrastructure play. In order to become more competitive, PCCW needs to streamline its products into a single platform. PCCW has a team of over 50 software and development engineers based in Brisbane; integrating various products into a single platform and developing new features to help the solution stand out could be an area of focus to help PCCW win in the SDI space.