Monday, June 27, 2011

Ernst & Young Entrepreneur of the Year Finalists - Irish Times

International Finalists:

JOHN DUNNE and TOM FARRELL, Intune Networks


FOLLOWING EUROPEAN project research at UCD, John Dunne and Tom Farrell founded Intune Networks in Dublin in 1999.

Both had been working with US, European and Japanese technology companies on a new type of laser, when they realised they could “beat them” at developing a practical way to calibrate and control such technology.

Entrepreneurial from the outset, the UCD pair formed Intune to create an innovative business around their ideas.

From 1999 until 2005, Intune had fewer than 20 employees and worked hard to survive the telecoms crash in 2001 by managing to shift its technology application into the sensor market for oil and gas. In 2006, its longevity in the optical space paid off as the emergence of YouTube, Facebook, Google and mobile networks offered it a new opportunity. The firm was ready to develop a killer solution for the industry.

Success in designing the world’s first optical packet switch and transport system has achieved global recognition and acclaim. It has won a number of awards, including The Irish Times Innovation Award 2011.

In 2010, the company reported turnover of €10 million. As a Silicon Valley-style company, backed by VC firms to the tune of €50 million to date, Intune has the potential to become “Ireland’s Nokia” due to the scale of the problem it solves throughout today’s global network and internet infrastructure.

The business has survived the largest-ever sector collapse in telecoms and the world’s economic crisis of 2008, while retaining 100 per cent of its core staff, 45 per cent of whom have PhDs. Today, it employs almost 200 – 155 are permanent employees – and has two RD facilities in Ireland, one in Dublin and one in Belfast.

Products

A range of technologies based on tuneable lasers, which has led to the development of the world’s first optical packet switch and transport system . This solves a 30-year-old architectural problem in world networks.

Customers

Intune’s first customer for its new product line is the Government. It was selected to deliver the technology behind the Exemplar Network facility in 2010 and unveiled the full, commercial version of the technology in May. It plans to announce its first customers shortly as trial deployments are rolled out globally.

What were your biggest challenges and how did you overcome them?

“Converting technology ‘speak’ into business value is the most challenging aspect of our business. Once you have business value you can attract customers and investors.”

...

Read More

Saturday, June 18, 2011

Intune Networks - from tunable lasers to carrier-class packet switching and transport... - Optical Keyhole

Interview with John Dunne, founder and CTO

Introduction


Intune Networks
, founded in 1999 by John Dunne and Tom Farrell and based in Dublin, Ireland, is focused on developing a carrier-class optical packet switch. The company now has approximately 155 full-time staff, with design centres in Dublin and Belfast and sales offices in the UK and the U.S.

Intune has developed technology, termed Optical Packet Switch and Transport (OPST), designed to address the challenges for service providers of handling the rapidly increasing and unpredictable traffic on their networks.

The company has raised two rounds of funding from venture capital firms, including a Euro 13.5 million Series A round and Euro 29 million in Series B. Intune is currently seeking further funding in a Series C placement of Euro 30 million.

Early background

Intune's founders started out in 1994 performing research on tunable lasers primarily through involvement in European research projects while at University College Dublin. After establishing Intune in 1999 the company was initially engaged in calibrating and developing technology for controlling other vendor's lasers at its lab in Dublin before embarking on building control systems for laser suppliers.

Mr. Dunne noted that at the time there were more than thirty companies building tunable lasers, representing a decent market for Intune's first products - now there are far fewer.

Intune subsequently won a contract to supply products to JDS Uniphase for its Eindhoven site in the Netherlands, formerly a Philips operation. However, this facility was shut down in 2001 and Intune was then forced to seek alternative markets for its technology.

Meanwhile, companies in the oil industry required a swept laser source for optical
sensing applications and Intune started developing and offering products for this market.

At the time Intune was also engaged in a project funded by the European Space Agency and another similar program with DARPA in the U.S. to develop an optical backplane utilising fast tuning lasers. Both projects were seeking to address the challenges presented by the problem of situating a large Cisco router in a satellite or high-altitude airship where weight and power consumption are key issues.

Birth of the optical packet switch

By 2005, Intune had developed its own optical switch design and spent the next two years on refinements. This necessitated raising funding to enable the company to bring the switch to market. In 2006, Tim Fritzley, a member of the technical advisory board, was appointed as CEO to help raise the first round of funding.

Prior to joining Intune, Tim Fritzley was running Microsoft's IPTV division and before that served with Tellabs. At Microsoft he realised that the existing network architecture was not suitable for handling traffic generated by sites such as Youtube and Facebook that had launched around 2003/4.

That network architecture, comprising a static optical layer with fixed lasers and Layer 2/3 switches and routers, remains fundamentally unchanged today.
Under this established network architecture, processes are centralised at the routers, which have had to grow ever larger as network traffic and the demands upon them increase, while the pipes that feed the routers have to carry greater loads and so are now being upgraded to 40 and 100 Gbit/s capacity.

Tim Fritzley saw that Intune's product could offer a solution to the problem facing carriers, which presently is inhibiting the development of new services such as cloud computing and interactive low-latency services. The carriers are also evaluating how to advance their metro infrastructure to enable efficient delivery of services such as virtual desktop and bandwidth on demand.

To address this market the Intune optical switch needed to be carrier-class. In 2007, Flextronics acquired Nortel's European design team for 10 Gbit/s systems in Belfast, but subsequently closed down the site, at which time Intune recruited approximately 45 of the staff to work on the optical switch.

Manufacturing services companies Flextronics and Celestica make the carrier-class package and also helped with its design.

Intune launched a commercial carrier-class product under the Verisma name on May 23, 2011 at the TM World Forum.

Verisma Platform

Describing the Verisma product, Mr. Dunne said the first commercial model is a carrier-class optical packet switch distributed around a fibre ring. In the future, different versions will be offered to address different end markets.

At the 2011 TM Forum Intune debuted and demonstrated the Verisma solution in collaboration with BT, Openet and Amartus, showing how a user can improve the quality of a video service on-demand by requesting extra bandwidth in real-time.

Intune has made the optical layer packet-responsive through the use of tunable lasers, thereby enabling increased utilisation of fibre capacity. Mr. Dunne explained that the product also enables operators to reduce the number of router ports required, so lowering costs, and employs web services software for control of the switch by an end-user:

"As Facebook has a programming interface whereby any programmer can join and develop an application - and the same goes for iPhone and Android - Intune offers an application interface for the network that is embedded in the switch. A user can thus set up an application for a web services portal that will call up bandwidth on demand from the network. For example, a user could provide a network for a social network on Facebook which would only be paid for when used".

The Intune solution means that operators can allow their customers to create new services on the network, effectively allowing business customers to create any service they need.

Financing market entry

The three main investors participating in Intune's Series A funding - Balderton Capital / Benchmark Capital Europe, Amadeus of London and Park Ventures in Boston - recognised from the start that this would be a long-term commitment since the length of time required to win business with large carries is a major issue for a small start-up company with limited funding.

In 2009 the company raised Series B funding from its existing and new investors, although the round took 13 months to complete due to the economic crisis. Mr. Dunne believes this was the largest private investment in the optical networking space to close during 2009.

Intune is currently seeking to raise Series C financing of Euro 30 million to support the company through the go-to-market phase of its development and into breakeven or profitability.

With respect to revenue, Intune generated sales of Euro 11 million in 2010 and expects to increase this to around Euro 20 million in 2011, including projects with the Irish government, before it finally begins to see revenue from carriers in 2012.

Mr. Dunne emphasised that Intune is already engaged with major carriers, having worked with BT since 2006 and with Telefonica in European projects since 2002.

The optical switch product was shipped in beta to carriers in 2009 and is now available in a carrier-class package that must be trialled with customers for a minimum of six months. Therefore it will be 2012 before Intune sees commercial deployments with existing carrier partners and trials with additional carriers.

Intune is currently involved with carriers in network modelling demonstrating that even with less than five percent of traffic deriving from cloud services a new approach is required to handle the traffic effectively.

Partnerships

Intune addresses the metro network space, specifically the optical transport and switching sector. Within this market each carrier has its own upgrade cycle, with some due to upgrade their networks towards the end of 2012 and Mr. Dunne said this is the window that Intune is targeting with its new carrier-class solution.

The company does not plan to sell direct to carriers and is engaged in developing partnerships with systems integrators used by the large carriers. While Intune recognises that as a small company it cannot address such customers directly, it is also aware that it needs to present the value proposition of its technology to carriers if it is to avoid being blocked by their existing equipment vendors.

Mr. Dunne feels that a current problem, particularly in the optical networking space, is that the established vendors are not innovating, and while the carriers wish to reduce the number of router ports they have to buy and to transition to a new network architecture there is nothing available from the major vendors at present:

"Ultimately it is down to the carriers to adopt new technology and help it to succeed in the market - the equipment vendors cannot create a market for their products. This means that at some level the carriers need to support small companies developing new technology or it will never reach market. For example, carriers are now becoming desperate for an alternative to the way they have been operating their networks for the past twenty years because they know they are not able to support emerging services such as cloud computing".

To date, Intune has focused on Europe due to limited resources, although it does now have an office in the U.S. and is engaging with Tier 1 carriers there. The company is also involved in projects in India and Africa via partners. The new funding round is intended to be used to help with expansion into additional geographic markets.

Mr. Dunne explained that if a carrier decides it requires a product from a supplier such as Intune it will instruct its integrator partner to work with the company to enable deployment of the equipment in its network.

The systems integrators for large carriers are the major global companies such as Ericsson, Nokia Siemens Networks and Alcatel-Lucent, which deploy carrier solutions based on their own equipment and products from third party suppliers.

Intune anticipates being in a position to announce systems integrator partners, along with carrier customers, before the end of 2011.

Competition

Mr. Dunne cited Matisse Networks, a developer of optical packet transport solutions, as a former competitor that ceased operations at the end of 2009 after being unable to raise new funding. The company had been planning to upgrade its enterprise-class product to a carrier-class solution when it ran out of cash. Matisse is believed to have been the only other start-up company working in the optical burst switching space.

However, it was noted that Huawei announced an optical burst product at OFC in 2011 and other large equipment vendors are working on similar technology that may or may not be productised at some time in the future.

The interest from major vendors in the technology Intune has commercialised is seen as helping build credibility with large carriers, which are aware that something needs to be done at the optical layer and can see evidence that suppliers apart from Intune are working on this.

Path to growth

Mr. Dunne expects Intune to increase the number of employees to around 600 from the current nearly 200 full-time and contract staff over the next two years as the company expands its customer base and addressable market through partnerships.

The additional staff, he noted, would be needed to support integrator partners as well as to meet the demands of a wider geographic reach, aside from the as many as several hundred engineers that will be required to develop the company's technology and provide optical integration expertise:

"From that point Intune could opt to acquire another company or assets as a path to continued growth, or it could decide to launch an IPO, it will be up to the company's board to decide how best to develop the company once it has established its technology and a position in the carrier market".

Read More

Friday, June 3, 2011

TM Forum Highlight: Optical Network bursts onto scene... - Telecom Engine

In one of the highlights of the TM Forum Management World event in Dublin last week, the Irish government showed off its Exemplar project, a “metro ring” carrier network in Dublin that is said to be the first to incorporate optical burst switching, a technology that could have broad implications in greatly improving the efficiency and capacity of carrier networks.

The Exemplar network is part of the MAINS project, led by Telefonica I+D's research branch, and with participation from a number of Dublin-based technology providers, including Intune Networks, which provided the unique switching technology, as well Amartus and Openet, which provided OSS and subscriber optimization software, respectively.

At the heart of the project is Optical Packet Switch and Transport (OPST) technology from Intune Networks, which will have achieved commercial viability after years of development. The unveiling of the project coincides with the commercialization of Intune’s new Verisma product line, which the company touts as the first carrier-class converged switch and transport solution based on optical burst switching.

A key benefit of the Verisma line is the ability to deliver so-called “liquid bandwidth” – the concept of allowing network operators to deliver packets of higher bandwidth on-demand. The versatility provided is considered to be particularly important for network operators supporting Cloud services and other high-bandwidth users, as well as allowing operators to participate more easily in spot-trading and service passes to boost revenue.

Tim Fritzley, Intune Networks CEO said “Before today’s commercial launch we have focused on validating the technical capabilities of our technology and performing early trials with large operators. We are now moving into a new phase of commercialisation as we prepare for multiple global first office applications in the second half of this year. So far the feedback from the market has confirmed our assertions and we have deep and broad engagement with the major players in the industry.”

The MAINS program is an European research project composed by universities, companies and research centres which aims to define and develop new architectural solutions for next generation metropolitan networks able to absorb new traffic demands generated fixed and mobile broadband access technologies.

The Exemplar Test-bed Program is a communications services test-bed provided by the Irish government’s Department of Communications, Energy and Natural Resources (DCENR) as a magnet to attract and expand leading edge research and development in Ireland for next generation Web and ICT services. According to Intune, the Verisma product family was selected as the foundation for the Exemplar lab Test-bed and allows the test bed to provide the flexible network architecture and simplified software operations and control interfaces required by the next generation of carrier services.

In the FP7 MAINS project, which is planning an OPST field trial in Cyprus in Q3-Q4 2011, the underlying objective is to develop a response to the fact that the current network architectures were never designed to cope with the new demands driven by emerging broadband Internet services like over-the-top video delivery, social networking and cloud computing.

MAINS project leader, Juan Pedro Fernandez-Palacios Gimenez from Telefá½¹nica I+D Ultrabroadband Networks area, commented “The proposed MAINS (Metro Architectures Enabling Sub-wavelengths) architecture targets a new architectural solution that will be able to face the huge expected traffic increase in a more cost-effective way. This architecture will be needed in order to assure a low cost broadband Internet access in Europe.”

With its commercial launch, the Verisma product line will begin to be deployed in the field to support a number of applications, such as cloud computing, mobile backhaul and metro optical aggregation. With its ability to provide mesh networking, dynamic bandwidth allocation and software-defined networking, the solution has been attracting attention for data centre interconnect and network-as-a-service applications.

As noted by Stu Elby, VP Network and Technology at Verizon, “The ‘cloud’ promises to cost effectively provide infrastructure, applications, and services where-ever and whenever they are requested. The ability to dynamically move virtual machines and/or data sets among data centres will allow us to address hot spot issues while potentially enabling new services. Current network constraints do not permit this capability to be exploited cost-effectively, so to this end virtualized, dynamic networking will accelerate the adoption and profitability of the cloud. “

Read More