Recently, our CEO Staffan Göjeryd was interviewed by Telecom Ramblings, talking about his journey, our approach for growing our footprint and the impact COVID-19 had on network traffic. The original article is found here.
Industry Spotlight: Telia Carrier CEO Staffan Göjeryd
The wholesale fiber and internet space has been a rough neighborhood ever since the dotcom crash, and over the past 20 years the cast of characters in it has evolved almost beyond recognition. But there are a few providers out there that have stuck to their guns through it all. One such service provider is Telia Carrier, the international division of the Swedish giant. Telia’s IP backbone has consistently topped the charts in recent years, and their reach continues to grow steadily and organically. With us today to talk about the company’s infrastructure and approach is CEO Staffan Göjeryd.
TR: Please tell us about your journey. How did you get to your current role at Telia Carrier?
SG: I started here almost 25 years ago, back in the days when the internet was very young. We had four megabits out of Sweden to the US and two megabits to the ‘rest of Europe’ back in those days. It was the infant stages of commercializing the internet. I worked a three-year stint in the US when we built out the US network back in the end of the ’90s and early ‘00s. Since then I was in various different departments, predominantly within Telia Carrier, for network planning, engineering, product management, and things like that, but also a little bit in Telia Company as well. I returned to Telia Carrier again back in 2014 on the data side, running what was then our business product line. Then, in 2016 when the previous CEO was asked to go to a different position within Telia Company, I was asked to take over Telia Carrier. So I’ve been internet and optical pretty much the whole time over these 25 years in seeing the ups and downs of this industry over these years.
TR: What does Telia Carrier’s infrastructure look like today?
SG: We are fiber-based both in Europe and in the US, lighting that with our own optical gear. Then we’re lease-based into the Asian market, and also transatlantic. We have legal entities in 35 countries, most of them with our own infrastructure either via IRU or direct ownership. Some of them are more lease-based into those markets, such as where we expand from the core of our footprint on a leased-basis to start with. If we get enough traction, we then typically try to expand with fiber IRUs in those markets and then put the full suite of services. Of course, we’re more fiber-rich in the European market because that’s where we dug a lot ourselves in the end of the 1990s and beginning of the 2000s. The US base is built from fiber pairs, but we have a coast to coast network, and also go north and south in a few different locations as well. We’re probably now in 300+ different data centers, about 130 of those are in the U S, around 170 are in European markets, and a few in Asian markets.
TR: What has your approach been for growing that footprint?
SG: It has been a very gradual and organic the whole time, which is a little bit unique in the market today. We haven’t adopted any kind of roll-up strategy. Also, over the past 4-5 years, we’ve been moving quite substantially into more tier-2 and tier-3 markets, predominantly in the US but also to some extent in Europe although we’re pretty well covered there from before. In that case we are both following the major content companies that we are servicing because they want to get closer to end users, but also, I think that the dynamics in the US market is different from the European markets in that you have a lot of localized service providers and to reach them you need to look beyond the predominant tier-1 cities.
TR: You’ve been adding fiber steadily in North America, do you foresee further expansion on that front?
SG: We’re still on that track. I don’t think you ever get done. The reasons are twofold. One is to create better uptake by adding fiber in different directions, but another is to get better diversity and resilience of the network domain. Increasing our footprint in the US market in that fashion is a continuous journey.
TR: Telia Carrier has taken a very organic route to growth, staying out of the consolidation fray. Did you consider the M&A route to expansion along the way?
SG: Not to a great extent, although there were some very early plans before the dot com bust. After that, I wouldn’t really say there has been much eyeing of those kinds of strategies. I think that we’ve been very conscious about trying to grow the way that we have. It isn’t necessarily bad to be a little bit of a niche play, to really excel in the connectivity space. I wouldn’t say we haven’t entertained it, but to be quite honest I think you need a different type of backing to have a roll-up strategy. That’s more for more aggressive venture capital than maybe for a telco, and it’s not necessarily the profile of Telia Company as a whole either.
TR: Telia Carrier recently expanded into Mexico. Do you have similar expansion plans into other global markets?
SG: Well, I think we’re always evaluating where it might be interesting. Moving farther away from an infrastructure perspective is not as simple as it is for somewhere in close proximity. US to Mexico is not as challenging as US to South America or Southern Europe to Africa, or whatever. But it’s something we always keep on debating internally regarding what makes sense and what doesn’t, and what’s the right timing for it. Right now it might be a little bit more challenging. Our expansions are pretty much customer and market enablement-driven.
TR: How has COVID-19 affected your operations?
SG: I think we’re most likely sharing the same story as many others who are running and operating a core fundament of the internet. In a three weeks span we saw pretty much a full year’s growth. At the same time, I and pretty much all staff went from working in the offices to working from home instead. In some ways, I think that it’s been an extraordinary learning period for us seeing that everyone can actually perform as well as they can when they’re working from home. I think it’s also been a positive for us that we’ve been so occupied during this time because it takes one’s mind off of other stressful thoughts. At the same time many people in our organization really feel that we are one of the core fundaments of the internet, and they’ve taken that responsibility full-on. In circumstances like this the internet just has to function, because it’s such a primary means of communication for everyone.
Operationally, during the lockdowns and everything else it has been a challenge accessing certain data centers. But in most markets it’s been also viewed from the governments and health departments that telecommunications and internet are necessities so it’s been manageable. Supply-chain-wise, I think it’s been okay. It’s a little bit of a wet blanket, but I think there has been less impact than feared in the early days. Of course, everyone in hindsight says they had fantastic plans for this, but I don’t think anyone actually had plans for this. I think that the industry at large has pulled together and gone back a little bit to the engineering core. It’s an ecosystem, which means it’s not enough if we just upgrade our own network. We’ve gotten back to nature of what internet and communications is all about in that sense, and I think that’s kind of a beautiful thing to see in the midst of everything else that is going on.
TR: As parts of the world re-open for business, are you seeing traffic demand pull back at all toward pre-pandemic levels?
SG: That would require a little bit of crystal ball gazing. We had a tremendous surge major in March and April in terms of volumes, and May and the beginning of June were still fairly high. But as the lockdowns ease up, people actually do want to get outside a little bit — which is healthy by itself. But traffic is still remaining at a fairly high level. In some way, the pattern definitely changed as well. Previously, internet usage was consumer-driven, so the peak traffic came in evening hours. Now we have seen the high usage much more drawn out during business hours because everyone is just sitting working from home, searching information and utilizing internet in a completely different way. Even though the lockdowns are easing up, people are predominantly still working very much from home. I think that any decreases that we’re seeing are more from the fact that people want to get outside and do other things for leisure than sit at home.
TR: What do you think carriers have learned from all this, and how will the lessons we have learned manifest themselves going forward?
SG: I think we have taken quite a few lessons. We have learned that it is actually quite all right that not everyone is in the office. From the perspective of the impact of the volume increase, I think we need to simplify the way that we structure our network domain to make it easier to modularize and expand on it. There have been actions in that direction, but now maybe we can make it happen a little bit quicker. I do feel that automation gets a little bit of a kickstart, especially the automation of information flows and ways to access information in a completely different manner than what we had previously. In the longer term, I’m curious see the effects of disaggregation of the optical domain to make it more fluid so that we can actually augment and change the network footprint. And then I think that more diversity and more redundancy in the footprints are needed. You’re never done building your network, there’s always more meshing to be done.
TR: How do you as a global network operator handle the complexity of operating across such a wide range of cultures and business environments?
SG: One aspect is the fact we’re focused around one area: connectivity. By doing that we get people of the same mold even though they are from many different cultures and nationality backgrounds. But of course we are different, and nationalities do make a difference. So we want to be local in the context of servicing different nationalities, but at the same time maintain a strong sense of belonging from that overall nature of what we do. By being a bit singular in focus around the connectivity space, it is easier to gather around one objective. Our organization is not huge, and there are not a lot of different buckets. It is geographically distributed but functionally centralized at the same time. We aim for consistency in our behavior across different markets.
TR: How else does Telia Carrier differentiate itself in a neighborhood as rough as the international wholesale marketplace?
SG: The customer experience angle of what we do is extremely important: to be transparent in the way we interact and communicate with our client base. I think sometimes people get too bogged down in technology features. Technology is definitely a great enabler, but if it’s not applied and packaged and used in a proper way, or if you don’t think about how you act toward your client base and tell it the way it is, it’s not going to serve the needs. That’s definitely something that we discuss a lot within the organization. We look at how to make people internally feel empowered, that they know how they should communicate with our clients and partners no matter where they are. That should be more or less intuitive if you’re transparent and tell it the way that it is. And I think that is extraordinarily important right now when we’re all working very remotely. We don’t have the human interaction in the way that we used to, and the connection on different levels of the organization is extraordinarily important. There should be a similar feel to it, no matter which part of the organization you’re interacting with.