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As applications and web services become more ubiquitous, companies with aging networks often find it difficult to compete with Internet companies that deliver apps and services more rapidly on modernized network infrastructures.
The Agricultural Bank of China (ABC) found itself in such a position in 2012. With Internet and mobile banking becoming more popular in China, ABC’s existing network wasn’t capable of delivering apps and services, such as online payment systems, that Chinese customers were receiving from competitors.
To better respond to customer expectations and stay competitive, ABC needed to move from its existing network, which comprised two separate networks spanning 13 service zones across China, to a converged, virtual network infrastructure.
The applications-centric network
Ranked fifth in The Banker’s “Top 1,000 World Banks,” ABC was China’s first state-owned commercial bank. With more than 23,000 international branches and more than 100,000 employees within China, upgrading ABC’s network was no small task. They chose Huawei to perform the upgrade.
Yu Li, General Manager for Huawei’s Data Center Network Product Line, and the person responsible for working with ABC to implement its new network, said that having an external production network — which supported ABC’s customer services through external transactions and third-party integrations and an internal administrative network for internal network functionality — had become unwieldy.
“The banking industry responded to challenges from Internet service companies by shortening the time-to-market for new services and applications,” Yu Li said.
Huawei researched the existing network and worked with ABC to plan a 24/7 data center architecture that could be designed and built within two years.
Sameh Bouljelbene, a Dell’Oro Group analyst who covers the controller, adapter and server markets, said that due to virtualization and cloud systems, servers, storage, and networking can no longer be viewed as separate entities with independent roadmaps. Rather, when planning upgrades, companies must first consider what the network will deliver and work backwards to plan the kind of server, storage, and network delivery mechanisms to use. Since networks and data centers have become increasingly application-centric, she said, service operators must start with the applications and decide what is needed to deliver the desired outcome.
“The goal of all of this is really to be able to run applications faster and be able to deliver services more quickly to the client,” said Bouljelbene.
A virtual network
In addition to converging its network, ABC wanted to use virtualization to create a network that could meet expected traffic demands for the next five to eight years and would be scalable, extensible, secure, and reliable enough to support both their branches and customers. Also, the bank’s existing services could not be interrupted during the network overhaul and migration. Yu Li said that ABC chose Huawei for the project based both on the company’s technical products and its delivery capabilities.
“Because it’s the banking industry, reliability and scalability requirements for the networks were the most challenging we’ve encountered,”Yu Li said. ABC also expected its network to be energy efficient and reduce maintenance expenses.
Casey Quillen, also of Dell’Oro Group, said that companies are increasingly turning to virtualization and Software-Defined Networking (SDN) when upgrading to reduce costs and take better control of their networks.
Network virtualization allows switching and routing processes to take on additional network capacity without adding more equipment. Just as virtualization has allowed companies to get more use out of their services and storage over the past 10 years, virtual networks provide them with more functionality with less administration.
“The real key benefit of SDN is to reduce administrative time and costs by removing the need to configure each and every piece of network equipment,” Quillen said.
The use of Huawei’s virtual CloudEngine Switch as the network backbone provided ABC the capability to implement a new network that includes such features as on-demand switching and automatic performance monitoring and measurement. The CloudEngine also uses virtualization at the device and protocol levels in conjunction with firewalls and security policies to ensure network security.
As a result of the project, ABC reduced its 13 service zones to five, which improved time-to-market for new banking services, and reduced maintenance. In addition, the company’s core network was upgraded from 2.5 Gbit/s to 10 Gbit/s and can be extended to reach 100 Gbit/s as networking requirements evolve. ABC’s network maintenance expenses have also decreased by more than 50 percent.
“With the new network, ABC can launch numerous Internet services to support their strategies over the next five years,” said Yu Li. “For example, ABC now supports third-party payments, and is working with Chinese messaging service provider WeChat to implement online payment options.”
Bouljelbene said that more companies will adopt virtualization and cloud-based data center networking as the technology continues to evolve. Because cloud-based services enable much faster time-to-market deliveries, companies like ABC need to upgrade their networks to remain competitive. The companies that deliver integrated solutions — from servers to storage to the physical network — are the ones to watch, particularly in emerging markets like China.
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