Open-Sourcing the Telecom Rack

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I started my career many years ago in the data center configuring Cisco routers and switches and thinking….damn these “boxes” are expensive as shit. I wasn’t thinking much about the future of the data center as I was more concerned about getting XOT working…yes kids, that’s X.25 over TCP/IP.

I was on the Iridium project for Accenture and we worked besides equipment like the Siemens D900 GSM Switch in a telecom data center.

Software-defined networking (SDN) and the Open Compute Project were established to break the proprietary nature of the hardware used in data centers. Instead of buying a Cisco switch with its software you would buy generic hardware from Taiwan or China and use the open source OpenFlow protocol.

Software-Defined Networking (SDN)

This commodization explains the growth of cloud providers like Amazon Web Services (AWS), Microsoft Azure and Google Cloud Platform (GCP). Companies want to ditch their existing data centers and move to cloud providers that have a perceived lower cost since they are using open source hardware and software to bring down the build-out costs.

While all this was happening in the corporate data centers, I figured the telecom data centers were business as usual with expensive proprietary hardware. Well, I was wrong.

I was recently chatting with a friend who is in the telecom field and he told me the same commoditization is happening in the telecom data center. The initiative is called Network Functions Virtualization (NFV). Reading the NFV white paper is a great way to get over your insomnia and also packs a lot of information in it.

The idea was that the core components of the data center – routers and switches were getting commoditized but the applications and servers were still proprietary in nature. NFV is changing that and it has enabled them to bring down the cost for telco providers but more importantly allow them to use the latest cloud technologies such as containers…that’s for another blog post.

Not surprising is that the NFV initiative was driven by the telcos like AT&T, British Telecom, China Mobile, Telecom Italia, Verizon and several more providers. I guess when you have these heavyweights behind a project it gains traction. With the upcoming 5G deployments around the world the telco providers figured they needed to cut costs somewhere and NFV was a good start. The one place I don’t think we will see open source equipment is the radios in the cell towers…that’s where all the money is going to be made by the 5G vendors like Samsung, Huawei, Ericsson and Nokia.

WeWork Collateral Damage in India

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The last couple of weeks have been a real shit show for WeWork. It all began when WeWork started it’s roadshow for its upcoming IPO which was being led by JP Morgan and Goldman Sachs. The IPO was targeting a USD $3.5 billion offering. WeWorks’ last valuation was at USD $47 billion based on their Series H raise from SoftBank back in January 2019.

The roadshow highlighted many of the issues that people have been complaining about, mainly their business model. They take on 10-15 year leases on buildings and then turn around and sell seats on a monthly basis. What really kicked up the negativity was a blog post by NYC Professor Scott Galloway titled WeWTF (click for blog post), and WTF was not We Truly Fine! The blog post highlighted many of the red-flags about the upcoming WeWork IPO. It’s fair to say the professor is probably not welcome at any WeWork facility around the world.

So how does the WeWork IPO train wreck lead to collateral damage in India? Well, there are 2 entities that will get affected – Embassy Group and OYO.

Let’s talk about Embassy Group first, they are a property developer based in Bangalore (Bengaluru) and the local JV partner in India for WeWork.

The JV entity is called WeWork India Management Pvt. Ltd., 30% is held by WeWork and the balance 70% is owned by the Embassy Group. In June 2019, they were hammering out valuations and it was reported the JV was worth USD $2.75 billion. Which meant if WeWork wanted to buy out the Embassy Group it had to fork over USD $1.9 billion. At the time of the negotiations WeWork was valued at $47 billion, but after all the drama some are now estimating the company to be worth under USD $10 billion. Which means there is NO WAY the India JV is worth USD $2.75 billion. If WeWork really has taken an 80% haircut then the JV is probably worth in the neighborhood of USD $600 million as the new enterprise valuation.

The other startup that is going to face valuation drama is Oyo. Oyo is backed by SoftBank which also happens to have funded WeWork and Uber. SoftBank seems to have a track record of going big on these bets and pushing for public market valuations even though these startups don’t make a dime in profit. Uber had the same drama with the founder before it’s IPO and was ultimately fired. Uber is currently trading at it’s all-time lows and has yet to figure out it’s path to profitability.

I’m pretty sure in the coming months we are going to hear about OYO along the same lines of these other SoftBank portfolio companies. In fact the NY Times recently had an article about SoftBank founder Masayoshi Son and how these bets may not turn out as expected. But don’t feel bad for Masa, some of his other bets have done fantastic. In 2000, SoftBank made its most successful investment ever – USD $20 million to a then fledgling Chinese Internet venture Alibaba. This investment turned into $60 billion when Alibaba went public in September 2014.

The Rally that Left Manpasand Behind

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Friday, Sept 20th, 2019 will hopefully go down in Indian financial markets as the day the economic boom for the country got re-started. The markets zoomed over 1,900 points or 5.3% for their biggest gain in a decade. The fuse was lit by the Finance Minister Nirmala Sitharaman when she announced several economic measures that should help companies. The theory is that by helping companies they will invest and create more jobs which the economy sorely needs.

One company that completely missed this rally was Manpasand. In fact, it fell below Rs. 10 for the first time ever which is also it’s par value or face value.

I’ve been tracking this stock for a couple of years now. And I got to watch it go up and down and so glad I never invested a single Rupee in it.

The company has been around for 30 years and is a Gujarat-based juice manufacturing company. In 2011, it got private equity money from SAIF Partners a well-respected PE fund. (SAIF is a acronym for Softbank Asia Infrastructure Fund). Then in early 2015 it started a roadshow to build up enthusiasm for its upcoming Initial Public Offering (IPO). You can read the Red Herring prospectus here (PDF) to see how they pitched their offering. What is a Red Herring prospectus? click here.

In mid 2015, Manpasand finally got listed on the National Stock Exchange (NSE) at Rs. 150 a share. All was good and it looked like another example where PE money helped a company grow and everyone benefitted.

Then in May 2018, the wheels fell off when the auditor on record – Deloitte Haskin & Sells resigned. It’s pretty clear from the above chart where the stock ended after this revelation. The brokerage firm Motilal Oswal quickly issued a statement (PDF) saying it’s recommendation for the stock was “under review”. Let me be clear, when the auditor bails on a company that’s a very clear indicator you need to bail on the stock.

Had you sold when the auditor resigned, then at the worst you would have broken even from it’s IPO price. But, if you held on thinking the auditor resigned because they didn’t like the Gujurati food while auditing the client, then that’s on you.

Creators, Consumers and Commenters

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I’ve had my YouTube channel going for about 10 months now and the experiment is going well, my goal was to create 1 video a month. For the past 10 years I have been a consumer of videos and I wanted to see what it’s like from a creators perspective what the YouTube platform is all about. I really thought it was about creators and consumers (people that consume the content), but there is a 3rd category…commenters. Let’s talk about these 3 categories of users.

  1. First up are the creators. I thought it would be easy to create content for YouTube but that’s just not the case. Video production is not easy and it’s one of the main reasons I stayed away from having a vlog but as I saw more and more content on video, it was clear that’s the future. Once you get past the video production drama you have to have interesting/compelling content and a style that people like. Now just upload content on a daily basis or every 2 to 3 days and you have a winning formula to monetize your YouTube channel. I would say 5% of the people are creators.
  2. The consumers. As with any property on the internet, you need people to view the content and also to view the ads that are inserted into the videos to get paid. These consumers are fickle, what’s hot one day can be dropped like a hot potato for another YouTube channel. This group makes up 80% of the overall audience and this is what most content creators are focused on.
  3. The commenters. Or as some creators call them…tormentors! This group makes up 15% of the audience and honestly it’s the one group I didn’t really think about till I started my own channel. Luckily my target audience is pretty sane but I’ve seen some channels where the comments section is a complete shit-show.

The comments section is a great way to get feedback and also get user engagement but it can also turn dark very quickly. In India, the YouTube comments section can be boiled down to 3 things that people end up fighting about if it gets heated:

  • BJP vs Congress (politics)
  • Hindu vs. Muslim (religion)
  • India vs. Pakistan (nationalism)

I’ll probably continue my YouTube experiment till the end of the year and then stop. It takes too much time to create quality content and I rather just blog here instead! Oh and I’m pretty sure no one wants to hear me talk about cars since there are 1000’s of channels that do the same thing.

Jio is Unstoppable

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Reliance Industries (RIL) this past week held its 42nd Annual General Meeting (AGM) in Nariman Point. Mukesh Ambani broke the meeting into 3 parts:
1. Oil & Chemicals
2. Jio
3. Reliance Retail

The Oil & Chemicals division is the money maker that allows Reliance to expand into new unrelated markets like Jio.

Jio was the star of this AGM and rightfully so, they have 350 million paid connections and on a growth path to 500 million connections. Their GigaFiber service is what everyone is waiting for. I’m on their free GigaFiber trial service and it’s been an absolute delight – 100Mbps download AND uploads. Because of GigaFiber we have cancelled our traditional coaxial cable connection and now watch everything via OTT apps like Amazon Prime, Netflix and YouTube.

When I used to work at Cisco Systems 20 years ago we talked about the Triple Play – Voice, Video and Data over the same connection. Here we are in 2019 and Jio is finally delivering the holy grail of connections. The connection speed will be upto 1Gbps to allow for the large amount of data that is required for broadcast quality high definition TV. The amount of traffic that is taken up by a single voice call is next to nothing and hence Jio is willing to say voice calls are free for life.

The Indian telecom industry has been completely decimated because of Jio. Idea had to merge with Vodafone and many of the smaller players had to merge as well. Airtel is still the largest wireless company but I’m sure will soon be eclipsed by Jio. It’s clear Jio has become what it is because of Mukesh Ambani and Reliance, their on-the-ground execution is unmatched. If they want something done, they figure out a way to clear the decks to make the policy match their goals – not a bad way to work!

What’s unclear is how much money they have spent on building out the infrastructure and the overall cost of getting Jio up and running. But that has always been the style of Reliance, don’t ask too many questions and just watch the stock price continue to go north. Jai Jio!

During the AGM they did several demos of new technology and they were quite cool. The only funny part it is when they did a video conference to someone in New Jersey where it was 2am in the morning yet it was a bright as hell – maybe some new virtual reality stuff!!

A Better Approach to the Mumbai Parking Fines

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By now 50% of my WhatsApp groups have messages about the new parking fines that have been implemented in Mumbai (Bombay) by the MCGM (BMC). The Municipal Corporation of Greater Mumbai (MCGM) is the governing civic body of Mumbai that used to be known as the Brihanmumbai Municipal Corporation (BMC).

haha, redius!

On Sunday July 7th, the new parking rules went into effect that basically raised the fines for illegally parking your car from a few hundred Rupees to thousands of Rupees.

The notice boards were plastered all over Bombay and don’t even get me started on how bad their grammar is. Words like hereby and radius were misspelled. Which I find ironic since for decades, Indian’s have been winning the Scripps National Spelling Bee every year in America. I guess all the good spellers are in the US.

Anyways, people have been talking about how bad the infrastructure of Bombay is and this is just another kick in the balls, I take a different viewpoint. I love that the fines are high, because that is the only way people will change their behaviour and make a difference in the city. I just wish they would had taken a different approach.

They should have launched an app for the city of Mumbai and one of the features would have been for citizens to report illegally parked cars. Currently, the police have to issue a ticket which is a bottleneck and unfortunately the CCTV system is not enabled for issuing violations for illegally parked vehicles. With an app, any citizen can take a picture via the app and it would be geo-tagged and then quickly determined if the car is within 500 meters of a MCGM car park and parked illegally.

But that’s not all, the person that submitted the picture would get 10% of the fine as a reward once the fine is paid. That reward amount can be used to recharge mobile phones and if the amount is above Rs. 10,000 then that person can initiate a KYC process to transfer the money to a mobile wallet like PayTM or a bank account. Imagine the entire population would be on the lookout for parking offenders and a great way for people to earn pocket money.

In addition, they should implement a “leader board” to see who are the biggest parking offenders and who submitted the most pictures. This would bring transparency to the process and also a great way to add “gamification” to the app. One thing is for sure, monetary fines are the only way to fix the problem.

Several months ago I took an Uber to the airport and the driver was speeding on Worli Seaface. But the minute he got onto the Sealink he was going the posted speed limit. I asked the driver why he was suddenly a law abiding citizen, he said “sir you don’t know? they have cameras that give fines.” Money talks.

Apparently, the first person to get a Rs. 10,000 parking fine in Bombay.

15 Years of the Blog

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Damn, it’s been 15 years ago since I put up my first blog post.
Here is my 5 year anniversary blog post and
here is my 10 year anniversary blog post

At those intervals I waxed poetically about what I had accomplished and gave some stats. This time, I’m wondering if I’ll still be blogging at the 20 year mark. The current trend is video and even I’ve gotten into video by launching my own automotive channel on YouTube. Okay, that sounds impressive but with a smartphone anyone can shoot video and quickly upload it to YouTube.

Will videos completely replace blogging? I don’t think so, but I think more and more content creators will move to video since that’s where the users are. I was recently talking to someone who was going to write a blog post about creating an Android app and submitting it to the Play Store. He scraped the idea and decided to create a video instead. Watching the video I was able to understand when he says “click here” and clearly see what he is clicking on.

Recently, I was researching some information on how to use the Indian GST portal and the blog posts where okay but the YouTube content was amazing. And most of the content was in Hindi since that’s what the user base is speaking.

When I launched my YouTube channel everyone said I should speak in Hindi but my Hindi is fucking horrible. And now I’m paying the price, my videos are in English and the number of views is a fraction of what it would be if they were in Hindi.

Anyways, I’ll continue to blog even if the user base has moved on. Because for me this blog helps me hone my writing skillz (haha).