2012 Global Technology Innovation Award - Global Satellite Transponder


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Cisco receives the 2012 global technology innovation award.

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2012 Global Technology Innovation Award - Global Satellite Transponder

  1. 1. BEST PRACTICES RESEARCHTechnology Innovation AwardGlobal Satellite TransponderGlobal, 2012Frost & Sullivan’s Global Research PlatformFrost & Sullivan is in its 50th year in business with a global research organization of 1,800analysts and consultants who monitor more than 300 industries and 250,000 companies.The company’s research philosophy originates with the CEO’s 360 Degree Perspective™,which serves as the foundation of its TEAM Research™ methodology. This unique approachenables us to determine how best-in-class companies worldwide manage growth,innovation and leadership. Based on the findings of this Best Practices research, Frost &Sullivan is proud to present the 2012 Global Technology Innovation Award in the GlobalSatellite Transponder Market to Cisco.Significance of the Technology Innovation AwardKey Industry Challenges Addressed by Cisco’s Internet Routing in Space (IRIS)solutionAlternate technological forces heavily impact fixed satellite service providers. On onehand, voice and data communication technologies evolve at lightning speed, while on theother hand the development cycle for a typical communication satellite takes at least fiveyears or more from project formation to satellite launch and beginning of service. Thismeans that fixed satellite service firms must have a good view of what futurecommunication needs are going to be in order to properly serve their current customersand garner new clients. Cisco’s IRIS solution, including the Cisco 18000 Series SpaceRouter, allows satellite providers to future proof their satellite fleet by enabling increasedflexibility of their satellite communication assets.The world market for fixed satellite services provided by geostationary orbit satellites isextremely competitive. Commercial satellite providers that lease transponders forcommunications must compete with other satellite firms, government satellitecommunications programs, and traditional wireline and wireless telecommunications firms.This can be very challenging as traditionally governments and wireline and wirelesstelecommunications firms often have much larger budgets to spend on communicationprograms and services. Nevertheless, fixed satellite service firms have severalmarketable advantages; they have much greater expertise in dealing with satellitecommunication than traditional telecom carriers, and they often are able to meetgovernment communication needs faster and more cost effectively than an internalgovernment satellite development program.Cisco’s IRIS solution allows satellite operators to better compete in the greatercommunications industry landscape by offering standardized IP protocols to the satellitemarket. Previously, satellites relied on proprietary communication protocols. This© 2012 Frost & Sullivan 1 “We Accelerate Growth”
  2. 2. BEST PRACTICES RESEARCHstandards-based approach allows satellite operators to seamlessly integrate their satelliteswith terrestrial networks and offer a unified set of communication services across thesenetworks.Customers typically lease transponder capacity or satellite bandwidth for one to five yearperiods. As prices for satellite bandwidth fluctuate, long-term leases can becomeprofitable assets for fixed satellite service providers or loss leaders. Customer demand forsatellite bandwidth can also change rapidly. For example, government customers mayhave little demand for satellite communications capacity in one region of the world andthen have extremely high demand due to a military operation almost overnight, examplesof this would include U.S. actions in Iraq and Afghanistan after 911 to recent NATOactivity over Libya. Cisco’s IRIS solution allows satellite operators to market more flexiblecommunication solutions to their customers and also allow them to be able to rapidlychange customers as service contracts reach fruition.The world market for fixed satellite services via geostationary orbit satellites is a largemature market with slightly over $10 billion in revenue and over 300 satellites inoperation. There are three major types of end users served by these fixed satellites.Consumers rely on satellite services for Direct Broadcast Satellite television and videoprogramming as well as Internet access. Businesses use fixed satellites to network andcommunicate with remote locations, track assets using machine-to-machine applications,backup traditional wireline networks in case of loss of service, and distance learning andtelepresence applications. Finally, governments are important users of fixed satelliteservices enabling communication for military and other assets in far flung corners of theworld. Cisco’s IRIS solution is capable of serving both government and enterprise users ofsatellite communications.Impact of Technology Innovation Award on Key StakeholdersThe Technology Innovation Award is a prestigious recognition of Cisco’s accomplishmentsin the Global Satellite Transponder Market. An unbiased, third-party recognition canprovide a profound impact in enhancing the brand value and accelerating Cisco’s growth.As captured in Chart 1 below, by researching, ranking, and recognizing those who deliverexcellence and best practices in their respective endeavors, Frost & Sullivan hopes toinspire, influence, and impact three specific constituencies: • Investors Investors and shareholders always welcome unbiased and impartial third-party recognition. Similarly, prospective investors and shareholders are drawn to companies with a well-established reputation for excellence. Unbiased validation is the best and most credible way to showcase an organization worthy of investment.© 2012 Frost & Sullivan 2 “We Accelerate Growth”
  3. 3. BEST PRACTICES RESEARCH • Customers Third-party industry recognition has been proven to be the most effective way to assure customers that they are partnering with an organization that is leading in its field. • Employees This Award represents the creativity and dedication of Cisco’s executive team and employees. Such public recognition can boost morale and inspire your team to continue its best-in-class pursuit of technology leadership for Cisco. Ch a rt 1: Be s t P ra c tic e s L eve rage for Growth AccelerationKey Benchmarking Criteria for Technology Innovation AwardFor the Technology Innovation Award, the following criteria were used to benchmarkCisco’s IRIS performance enhancement over legacy satellite solutions: • Uniqueness of Technology • Impact on New Products/Applications • Impact on Functionality • Impact on Customer Value • Relevance of Innovation to IndustryDecision Support Matrix and Measurement CriteriaTo support its evaluation of best practices across multiple business performance categories,Frost & Sullivan employs a customized Decision Support Matrix (DSM). The DSM is ananalytical tool that compares companies’ performance relative to the industry standard withan integration of quantitative and qualitative metrics. The DSM features criteria unique toeach Award category and ranks importance by assigning weights to each criterion. The© 2012 Frost & Sullivan 3 “We Accelerate Growth”
  4. 4. BEST PRACTICES RESEARCHrelative weighting reflects current market conditions and illustrates the associatedimportance of each criterion according to Frost & Sullivan. Fundamentally, each DSM isdistinct for each market and Award category. The DSM allows our research and consultingteams to objectively analyze each companys performance on each criterion relative to theindustry standard and assign performance ratings on that basis. The DSM follows a 10-pointscale that allows for nuances in performance evaluation; ratings guidelines are shown inChart 2. Ch a rt 2: Pe rfo rma nce -B as ed Ra ting s f o r D e c is io n S u p po r t Ma t r i xThis exercise encompasses all criteria, leading to a weighted average ranking of the awardrecipient as compared to the industry norm. Researchers can then easily identify the valueof the increase in technical innovation brought to the industry by the award recipient.Best Practice Award Analysis for CiscoThe Decision Support Matrix, shown in Chart 4, illustrates the relative importance of eachcriterion for the Technology Innovation Award and the ratings for the award recipient ascompared to the industry status quo. Ch a rt 3: De c is ion Sup p o rt M a trix f o r T e ch no logy I nn ova tio n Awa rd Measurement of 1–10 (1 = lowest; 10 = highest) Award Criteria Products/Applic Impact on New Uniqueness of Innovation to Relevance of Functionality Technology Weighted Impact on Impact on Customer Industry Rating ations Value Relative Weight (%) 20% 20% 20% 20% 20% 100% Cisco 7 8 9 6 10 40 Industry Legacy Level of Technological Innovation 5 5 5 5 5 25 Comparative Difference 2 2 4 1 5 15© 2012 Frost & Sullivan 4 “We Accelerate Growth”
  5. 5. BEST PRACTICES RESEARCHCriterion 1: Uniqueness of TechnologyCisco is the market leader in the sales of networking routers with more than half theworlds routers sold in 2011. While other companies also make networking router, Cisco isthe industry standard for routing capabilities. The Cisco IRIS payload is the only router inspace and Cisco has 100% market share of the space routing market, a new market forrouting capabilities. While other companies have brought switching capabilities to spacewithin satellites, the Cisco Space Router takes advanced routing and switching in space toa completely new and previously unseen level within the industry. Cisco IRIS score onthis criterion is based on the improvement in capability going from a satellite with anetworking switch on board to that of a satellite with a fully functional network router onboard.Criterion 2: Impact on New Products/ApplicationsCisco IRIS greatly enhances the use of new satellite communications services andcapabilities. Cisco IRIS greatly improves time to market of new services and the transferof satellite communications bandwidth from one application to another, allowing serviceproviders to optimize bandwidth use and maximize revenue by being able to shiftcapabilities to better suit customer needs. Cisco IRIS score on in this criterion is based onits positive impact and improvement of government and enterprise communications andits ability to bring new services to market.Criterion 3: Impact on FunctionalityThe Cisco Space Router greatly improves communication satellite functionality. Cisco IRISmakes satellites more flexible and enables them to maximize bandwidth utilization oncommunication services that are delivered while at the same time allowing the satellite tochange services and applications delivered much more rapidly. Cisco IRIS score on thiscriterion is based on the improvement that the router provides to equipped satellites inoperation as compared to traditional ‘bent pipe’ satellites.Criterion 4: Impact on Customer ValueThe Cisco Space Router increases customer value in several key ways. The first way isthe increase in performance and bandwidth utilization which helps service providers toincrease revenues by getting the very most out of their satellite throughput. The secondway that customer value is enhanced is through the ability to change services,applications, and customers rapidly helping satellite service providers to seamlesslytransition satellite bandwidth usage. Finally Cisco IRIS enables satellite service providersto better serve their customers communication needs by being able to adapt to changingenvironments and changing requirements much faster than traditional satellites. CiscoIRIS score on this metric is based on its current low penetration of satellites in spaceoffset by Frost & Sullivan’s belief that as the industry is educated on the benefits of the© 2012 Frost & Sullivan 5 “We Accelerate Growth”
  6. 6. BEST PRACTICES RESEARCHCisco IRIS solution, more customers will adopt this product and increase customer valueconsiderably. The impact on customer value is already off to a very good start. The CiscoSpace Router was launched on Intelsat 14 and tested extensively by the U.S. government.Intelsat is the largest operator of geostationary orbit satellites and the successful testingof Cisco IRIS by the U.S. government has demonstrated that the Cisco Space Router ismarket ready. Industry participants have taken notice of this fact and TCS, a leadingsatellite communications system integrator, mobile communications specialist, andgovernment contractor, has signed an agreement with Cisco to exclusively market IRIScommunication services to the enterprise and government satellite communicationsmarket.Criterion 5: Relevance of Innovation to IndustryCisco IRIS is revolutionizing the satellite communication industry by bringing theperformance of Cisco’s wireline and wireless networking capabilities to space. Theimprovement in satellite communication by Cisco IRIS cannot be overstated; it is bringingthe satellite industry up to speed with the terrestrial networking improvements that Ciscohas pioneered since their inception in 1984. Cisco IRIS score in this metric is based onthe large improvement to the satellite communications industry that has been madepossible by Cisco.ConclusionCisco IRIS allows communication satellites to interface better with traditional wireline andwireless networks, thus allowing more seamless communication among mixed networks.Cisco IRIS is focused on extending the value and capability of networking to space andsatellite communications. The advancement that Cisco IRIS brings to the market is theability to utilize the benefits of the Internet Protocol (IP) within satellite communicationswhich have in the past have utilized proprietary protocols that are difficult to networkwithin traditional IP-based wireline and wireless networks. IRIS is satellite frequencyband agnostic and will improve communication and bandwidth with traditional Ku- and C-band satellites as well as up and coming high throughput Ka-band satellites, and newmilitary X-band satellites.Cisco IRIS brings reduced latency, increased throughput, improved network intelligence,and greatly enhanced flexibility to satellite communications. This allows satelliteoperators and communication users to maximize the value of the limited satellitebandwidth currently in orbit. IRIS allows satellite operators, satellite communicationservice providers, and satellite users to more effectively communicate via satellite. IRISbrings the benefits of Cisco networking to space and satellite communications and hasbeen deemed extremely worthy of Frost & Sullivan’s 2012 Technology Innovation Awardby our Satellite Industry research team and Best Practices staff.© 2012 Frost & Sullivan 6 “We Accelerate Growth”
  7. 7. BEST PRACTICES RESEARCHThe CEO 360-Degree Perspective T M - Visionary Platform for GrowthStrategiesThe CEO 360-Degree Perspective™ model provides a clear illustration of the complexbusiness universe in which CEOs and their management teams live today. It representsthe foundation of Frost & Sullivans global research organization and provides the basis onwhich companies can gain a visionary and strategic understanding of the market. The CEO360-Degree Perspective™ is also a “must-have” requirement for the identification andanalysis of best-practice performance by industry leaders.The CEO 360-Degree Perspective™ model enables our clients to gain a comprehensive,action-oriented understanding of market evolution and its implications for their companies’growth strategies. As illustrated in Chart 5 below, the following six-step process outlineshow our researchers and consultants embed the CEO 360 Degree Perspective™ into theiranalyses and recommendations. Chart 4: The CEOs 360-Degree Perspective™ Model© 2012 Frost & Sullivan 7 “We Accelerate Growth”
  8. 8. BEST PRACTICES RESEARCHCritical Importance of TEAM ResearchFrost & Sullivan’s TEAM Research methodology represents the analytical rigor of ourresearch process. It offers a 360 degree view of industry challenges, trends, and issues byintegrating all seven of Frost & Sullivans research methodologies. Our experience hasshown over the years that companies too often make important growth decisions based ona narrow understanding of their environment, leading to errors of both omission andcommission. Frost & Sullivan contends that successful growth strategies are founded on athorough understanding of market, technical, economic, financial, customer, bestpractices, and demographic analyses. In that vein, the letters T, E, A and M reflect ourcore technical, economic, applied (financial and best practices) and market analyses. Theintegration of these research disciplines into the TEAM Research methodology provides anevaluation platform for benchmarking industry players and for creating high-potentialgrowth strategies for our clients. C h a r t 6: B e n chm a rk i n g Pe rf o rm an c e w i th TE AM Re s ea r chAbout Frost & SullivanFrost & Sullivan, the Growth Partnership Company, enables clients to accelerate growthand achieve best-in-class positions in growth, innovation and leadership. The companysGrowth Partnership Service provides the CEO and the CEOs Growth Team with disciplinedresearch and best-practice models to drive the generation, evaluation and implementationof powerful growth strategies. Frost & Sullivan leverages 50 years of experience inpartnering with Global 1000 companies, emerging businesses and the investmentcommunity from more than 40 offices on six continents. To join our Growth Partnership,please visit http://www.frost.com.© 2012 Frost & Sullivan 8 “We Accelerate Growth”