Akamai Technologies: key steps to support 5G technology
Despite the fact the Internet was born just half a century ago, it now forms an absolutely critical part of our day-to-day lives, particularly in such an atypical year as 2020. It has facilitated the move to working from home for millions worldwide, has let us stay in touch with family and friends, and has allowed us to stream new movies and play the latest games.
But with the Covid-19 pandemic forcing massive behaviour change on businesses and consumers alike, the Internet has been put under the spotlight and, in many instances, has needed to facilitate increased network traffic. On Akamai’s global platform, peak traffic for the month of March 2020 was 167 Tb/s, more than double the March 2019 peak of 82 Tb/s. And with more users and more content coming online, the traffic the Internet must manage will only grow larger. Not to mention the expected impact of demanding new technologies like 8K UHD or VR streaming.
Technology never sleeps though and the latest innovations coming our way promise to bring more speed and convenience than ever before. This prompts even further behaviour change, with increased demand for more and higher quality streaming and better and faster online experiences. However, there’s one question that remains: is the Internet ready?
The advent of 5G
The prospect of 5G is an exciting one, promising increased bandwidth, lower latencies and more. But these improvements aren’t a given. As we’ve learned through past experience, improving one part of a technology, in this case the mobile network connectivity, does not always improve the overall user experience and sometimes can actually have an adverse effect.
As faster and more reliable mobile connections allow users the possibility of richer experiences, they will quickly adopt them, and then come to expect them to be flawless: HD video with fast startup and no rebuffering, instantaneous websites and speedy downloads, to name just a few. However when millions of consumers are pushing 5G mobile networks to these new limits, incredible new pressure will be put on the system in ways which faster links alone cannot manage.
Even with 5G, if content is not positioned very close to the device requesting it, it will have to traverse many networks across the Internet before arriving at the device. Each hop the content has to jump through is a bottleneck that can become congested and ruin the experience, and these bottlenecks will only be worsened by increased demand. Users connecting to servers hosting content in a centralized manner will simply encounter a poor quality experience as network connections become overloaded.
If you’re not operating on the edge, you’re clogging up the works
The potential obstacles to be encountered from these burgeoning technologies can only be overcome with an intelligent edge architecture. Early iterations of the Internet imagined that content would flow from a single source directly to each intended recipient - regardless of the distance or audience size. However, as the volume of content and users rapidly grew, it became clear that this architecture could not support the most popular and in-demand content.
An intelligent edge platform is by its very nature highly distributed. It delivers content to users from a server that’s close-by, avoiding bottlenecks and congestion on the Internet, and reducing the load on the servers hosting the content. This makes it possible to deliver higher definition video without glitches, load websites without delays and download software in a fraction of the time. The intelligent edge is also programmable, so that organisations can make dynamic decisions in serving content while maintaining the lowest latency possible to the end-user.
The past few months have been but a small wake-up call for the industry and we’re only at the very beginning of the next chapter of the Internet. Let’s capitalise on the sense of urgency that has seen us through these turbulent times and start architecting our services so that the Internet can continue to deliver on its promise of a more connected, collaborative and content-rich world. It’s clear that 5G promises so much, but to truly embrace it and feel its full benefits, we must look beyond the hype of faster connections to transform business on the Internet.
M&A activity key lever for future tech sector growth
Despite the continuing uncertainty of the pandemic, the tech sector has witnessed soaring dealmaking activity over the past year, rocketing in the second half of 2020, with the last quarter of 2020 a record one for M&A activity, and momentum continuing into 2021.
Dealmaking in tech sector soars in past year
And the latest figures bear this out with the number of technology M&A deals totalling US$208.44bn globally in Q1 2021, according to GlobalData. While the US holds top spot both in volume of deals (1034) and total value (US$140.61bn), Europe ranked next with 649 deals (US$44.49bn) with the UK continuing its reign as Europe’s biggest M&A market with 204 deals.
In particular, megadeals – those valued at US$5bn or more – soared in 2020 representing 59% of all global technology sector deal value in 2020, up from 47% in 2019, according to the latest edition of the EY Technology Global Capital Confidence Barometer.
This tech sector trend towards megadeals is backed up by EY’s CCB data, with 16% of tech sector respondents planning to pursue transformative deals valued at US$5bn or more in the near-term.
While technology deal activity “all but stopped at the beginning of 2020 after fluctuating between historic highs and lows, companies pivoted quickly and tech M&A exploded in the second half of the year”, says Barak Ravid, EY Global TMT Leader for Strategy and Transactions.
M&A activity level for tech sector growth
Looking ahead to the future, technology executives are optimistic, with nearly half (47%) expecting profitability to fully rebound this year, according to CCB data, compared to 23% across all sectors, and with more than half (51%) planning to pursue M&A in the next year in order to sustain growth.
According to Ravid, M&A activity is increasingly becoming a key lever for growth as businesses look to recover.
“To position themselves for future revenue growth, tech companies are now adjusting their M&A strategy to focus more on a target’s business resilience, digital technology alignment and to gain market share through consolidation,” says Ravid.
However, with an increasingly competitive deal market and ongoing geopolitical tensions, the majority of tech execs expect to see more competition in the bidding process for assets over the next year, primarily from private capital.