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  • 8/8/2019 Detecon Opinion Paper When Giants Flex Their Muscles: Green Activities of Silicon Valley ICT Industry Leaders

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    Opinion Paper

    When Giants Flex Their Muscles

    Green Activities of Silicon ValleyICT Industry Leaders

    2010 / 10

    We make ICT strategies work

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    When Giants Flex Their Muscles Green Activities of Silicon Valley ICT Industry Leaders

    Opinion Paper 2 Detecon International GmbH

    Table of Contents

    1 Executive Summary.............................................................................................42 Introduction..........................................................................................................6

    2.1 Green ICT Just another Fashion? ............................................................62.2 Purpose of the Survey The Scale of Impact .............................................7

    3 Perception How do you see? ...................................................................... 114 Approach How do you address?.................................................................175 Activities What do you do?..........................................................................24

    5.1 External Facing Market...........................................................................245.2 Internal Facing In-House ........................................................................ 275.3 Financial ROI & TCO..............................................................................28

    6 Conclusion The Green Hype Split .................................................................. 307 The Authors.......................................................................................................328 The Company....................................................................................................33

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    Table of Figures

    Figure 1: Take home messages of the green survey...............................................................4Figure 2: The 10 survey participants ........................................................................................7Figure 3: Energy-Efficiency & Sustainability groups of the companies ....................................8Figure 4: Building blocks of a carrier and its surrounding telco ecosystem..............................9Figure 5: Addressed topics within the survey...........................................................................9Figure 6: Cost savings dominate over environmental considerations ....................................11Figure 7: Cost savings are the prime driver of green ICT.......................................................12Figure 8: Even spread of hype & tangibility in the market yet as function of target group .....14Figure 9: No end-consumer will accept performance drawbacks for being green .................15Figure 10: Technology is the field where Green ICT will show the largest impact.................17 Figure 11: What are the prime green activity fields within the technology sector ..................19Figure 12: What are the prime green activity fields within the business sector......................21 Figure 13: To start with internal green changes is the preferred approach............................23 Figure 14: Market-facing activities of the interviewed companies..........................................24Figure 15: Responsibilities to push green implementations (along the supply chain)............25

    Figure 16: All have expectation for HW manufacturers..........................................................25Figure 17: 90% confirm the purchasing power of large enterprises.......................................25Figure 18: Activities of the interviewed companies facing in-house .......................................27Figure 20: The hype cycle splits into 2 curves with both having different recovery times......30

    Color Code:

    Take Home Message Citation from company

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    1 Executive Summary

    Carriers around the world are looking for new opportunities to reduce internal costs, growrevenue through new services and smart solutions, and to create a positive brand image in

    the hope that this results in promoting stickiness and lowering churn and at the same time

    ensures compliance with regulations, satisfies stakeholders expectations, and avoids

    bringing the company into the line of public fire. Green Information & Communication

    Technology (ICT) everything around sustainability and energy-efficiency in the

    telecommunications space has the potential to address all the above angles; if it is done

    right.

    At the moment it is (still) challenging to clearly distinguish between hype and reality in this

    field. Therefore it is crucial to initiate the right steps and in the right order as the market is still

    in its infancy, seeking new (or alternative) business models and best practice approaches.

    Waiting is not an option because otherwise conflicts with upcoming regulations are

    guaranteed.

    The content of this publication is a reflection on the answers given to a survey by selected

    ICT companies. It delivers first-hand insights as to what suppliers, vendors, and partners of

    carriers have on their green mind. The survey addressed various fields (perception,

    approach, activities) of the Green ICT sector and the answers are used to identify green

    patterns and trends. Carriers should consider them for the development of their own green

    strategies and approaches. When it comes to environmental-friendly actions, imitation is

    highly welcome as it serves the greater good.

    The sketch (Figure 1) illustrates the key take home messages and attitudes stemming fromthe Valley. They are discussed in detail in this publication.

    Subtitle

    Walk the

    Talk

    Cost

    Savings

    Rules

    Technology

    is theEnabler

    Start with

    In-House

    Greening

    Enable Fast

    Market

    Penetration

    Stick to public

    promises. Ideal:

    Under-promise/

    over-deliver.

    Prime

    Activity

    Fields

    NoPremium

    Fee for

    Green

    BeObjective

    Imitation is

    OK

    Carrier

    No Island

    Activities

    Independent and 3rd

    party vendor-vendor

    assessment is

    indispensable toobjectively separate

    hype from reality.

    Despite

    governmentalpressure and

    environmental

    expectations,

    saving costs is

    the main driver ofgreen.

    Embrace green

    knowledge sharing

    along the supply

    chain and other

    carriers.

    Innovation, Supply Chain,

    Cost Calculations, DCOptimization, Energy-

    Efficient Hardware,

    Software Energy

    Management.

    Green is still partlymistrusted. Majority of

    consumers are not willing to

    pay a premium to be green.

    Dont try to create positive

    public awareness if it is still

    messy behind the curtain. It

    is essential to put ones ownhouse in order first.

    Savings could be used for green

    product discount end consumer

    campaigns or to accept initial

    premium fees from manufacturers

    to support cost-intensive R&D.

    Create green synergies by establishing partnerships and alliances.

    New green business & services are enabled by technology, not the other way around.

    Figure 1: Take home messages of the green survey

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    The outcome of this survey will for sure not provide the solution for the theory of everything.

    However, size indeed matters in this case and the impact scales directly with it. The

    participants have double-digit telco market shares within their fields of core business.1

    When

    put together those companies essentially have a grip on 40% to 90% of the global telcomarket. They are the main hardware, software, service and solution providers to the majority

    of carriers around the world; they are the giants within their fields. Whatever green path

    these players choose to walk will be the trail others shall follow. Carriers should therefore

    pay close attention.

    1 Disclaimer: All logos shown within this document are registered trademarks of the respective companies in the

    U.S. and other countries. Logos are the property of their respective owners. The use of logos in this documentdoes not imply a partnership relationship between Detecon International (including its affiliated and subsidiarycompanies) and any other company shown in this document.This publication is derived from sources believed to be accurate and reliable, but neither its accuracy norcompleteness is guaranteed. The material and information in this publication are provided "as is" and withoutwarranties of any kind, either expressed or implied. Any opinions and views in this publication reflect the current judgment of the authors and may change without notice. It is each reader's responsibility to evaluate theaccuracy, completeness and usefulness of any opinions, advice, services or other information provided in thispublication.The information and opinions contained in this publication constitutes neither a solicitation, nor arecommendation, nor an offer to buy or sell investment instruments or other services, or to engage in any otherkind of transaction. The information described in this publication is not directed to persons in any jurisdiction

    where the provision of such information would run counter to local laws and regulation. Detecon International andits related, affiliated and subsidiary companies disclaim all warranties, expressed or implied, including, but notlimited to, implied warranties of merchantability and fitness for a particular purpose.

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    2 Introduction

    A core attribute of something being en vogue is that it tends to come and go. When attimes trendy products, services and attitudes get into the minds and imaginations of

    consumers, they get onto the rollercoaster and run through the product life cycle until they

    reach their natural end. For the last 2 years green appeared to be on a similar ride.

    Is being green just a fashion? Another wave that will roll up to the beach, break a few

    small sand-castles and then recede quietly? Or will it last longer and show tangible

    sustainability? Trends often fall in the former category a wave that is quickly rising and

    then falling again.

    2.1 Green ICT Just another Fashion?

    2009 was when Green entered the collective imagination of consumers and governments.

    It was a record year for green investments2. Every day brought new announcements, new

    promises and new ideas. Discussions on greenhouse emissions and green technologies

    were collectively spurred by nervous investors looking for the next stock market darling to

    arrive, governments interested in new opportunities for job creation and consumers

    interested in reducing their environmental footprint. In the year 2009 everyone was suddenly

    involved and interested in both sides green bucks and green trees.

    This compelling mixture of demands and expectations triggered the urgency on part of

    businesses to act. For one, it became clear that reducing expenses was crucial and couldpotentially be the difference between bankruptcy and survival. In addition it started to

    become clear that the public had generally accepted the idea of man-made global warming

    and that companies would need to be viewed as green in order to be considered socially

    acceptable (much like changes in public perception of pollution control, labor policies and

    equal opportunities for women in the decades past). As a logical consequence, the public

    and the government began drawing their attention to big industry players by judging and

    observing their initiatives to drive a better (greener) future. Expectations and pressure from

    and on the industry were put on a fast-track and (unfortunately) green was pulled into the

    marketing machinery. The term green got exploited, deformed and abused to the very

    limits. Suddenly everyone and everything was green, just in different shades.

    Over the course of 2010 it has become rather quiet around the green bubble. Or so it seems.In reality, activities have actually moved on to a different (higher) level. A lot simply has been

    pushed out of the public radar and is taking place in-house. It is the result of lessons that

    many companies had to learn in a rather painful way. Fingers were burned by having pushed

    green marketing campaigns a bit too far. Due to misconception, over-hype, big promises

    and small results, the term green is still viewed with suspicion by many consumers and

    regulatory agencies. Companies have now realized that it is better to under-promise, then

    over-deliver and do so without too much publicity.

    2Green Transition Scoreboard: Findings on Investments since 2007, July 2010

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    The above history is what makes Green

    different. It is touching the very fundamentals of

    consumer attitudes and wallets. Albeit being en

    vogue at the moment, green is not just anotherwave. It is a necessity, not a luxury. It is neither

    a product nor a service (although it will contain

    both). Green is here to stay.

    2.2 Purpose of the Survey The Scale of Impact

    The purpose of this publication is to separate the reality from the hype in terms of green

    activities. It aims to understand how leading players from Silicon Valley are dealing with and

    working on energy efficiency and sustainability.

    The survey is custom-tailored for the telecommunications industry and in particular for

    carriers. The questions asked are addressing various fields of the Green ICT sector. The

    survey identifies patterns and trends amongst the participants. These are useful for carriers

    to consider for the development of their own green endeavors and optimizations as well as

    for Corporate Social Responsibility strategy.

    The survey has been conducted with only a few companies (in total 10, see Figure 2). Yet

    these participants all have global market shares in the double-digit range within their fields of

    core business. When put together they control 40% to 90% of the market. They are the

    main hardware, software, service and solution providers to the majority of carriers around the

    world. These companies are the giants within their fields. Size indeed matters and the impactscales directly with it.

    Figure 2: The 10 survey participants

    With its ability to drive down costs

    in favor of the environmentGreen is for carriers a necessity,

    not a luxury.

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    Every individual can no doubt contribute to a sustainable future. However, if action points for

    solutions and changes have to be put onto a fast track, then the scale of impact matters. As

    mentioned before, this naturally draws the attention to the large industry players rather than

    end-consumers. A single move of a large enterprise may be of equal impact as to havingnumerous end-consumers decide, act and move simultaneously. Consider the following

    hypothetical scenario: A software update designed to increase the efficiency of power

    consumption, is remotely pushed onto end-consumer laptops and PCs. About 1.5 billion

    PCs are worldwide in use3. Assuming that just 30% of these are configured to accept

    automatic updates, the effect of such an automated remote push would be the equivalent of

    a scenario where 500 million end-consumers proactively search the Internet for energy-

    saving tools, install and then start using such a tool all in the same night. Which scenario is

    more likely?

    As for the interviews themselves, they were all conducted with VPs, Directors and Principles

    of these companies. Their titles might differ as might the names of their groups (Figure 3).

    Regardless, all of the interviewees were directly involved with energy efficiency &sustainability related topics within their respective companies. For a topic such as Green ICT

    which is still in its burgeoning state and suffers from a lack of best practices & maturity,

    talking to specialized group/division heads is important in order to gather both vision and

    detail.

    GreenBusiness

    Operations

    & Strategy

    Climate

    &Energy

    Strategy

    Environmental

    SustainabilityGroup

    Eco-

    EnvironmentalEngineering

    Energy&

    Environment

    Group

    Energy

    EfficiencyGroup

    EnergyEfficient

    Solutions

    Power

    Strategies &

    SustainableTechnologies

    CorporateSustainability

    Group

    Green

    Business &TechnologyDevelopment

    Figure 3: Energy-Efficiency & Sustainability groups of the companies

    Participants were chosen to avoid developing a tunnel view, e.g. only focusing on the top

    10 network component manufacturers (or any other sector). From a carriers perspective this

    would only be a slice of the ecosystem surrounding it. A carrier can be seen as multi-layered

    structure. Each of these layers serves a specific purpose and is being provided or supported

    by specific industry sectors.4 The goal of the survey is to cover as many relevant layers as

    possible and to gain insights along their own supply chain (Figure 4).

    3 George Shiffler, Gartner Research: PC Installed Base, Worldwide, April 2008

    4 We neglect for a moment that there is a trend in the telco industry to either expand vertically or to acquire

    companies to enter new business fields (inorganic growth). The figure above should be seen as traditional. Inreality, the individual pieces of the puzzle would not have sharp boundaries and rather show a strong overlap.However, results of the survey remain unimpaired.

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    Services

    Software

    Hardware

    Access

    Aggregation

    Core Customers

    Carrier Building Blocks

    Enterprise Solution

    Providers

    Network Hardware

    ManufacturersInternet Service

    Providers

    End-User Device

    Manufacturers

    Telco Ecosystem

    Figure 4: Building blocks of a carrier and its surrounding telco ecosystem

    Within this report the interviewees responses have been sorted to fit areas of Green ICT

    which are relevant to (Figure 5):

    Perception & Definition

    Approaches

    Impacts on business & technology

    Internal activities (in-house)

    External activities (market-facing)

    Financial impacts

    Technology &Business impacts

    of Green ICT?

    Approach to Green ICT?

    Internal & External Greenactivities?

    Financial impactsof Green ICT?

    Perception of Green ICT?

    Survey Technology &Business impacts

    of Green ICT?

    Approach to Green ICT?

    Internal & External Greenactivities?

    Financial impactsof Green ICT?

    Perception of Green ICT?

    Survey

    Figure 5: Addressed topics within the survey

    The survey is custom-tailored for the

    telecommunications industry, inparticular for carriers.

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    Of particular interest are the approaches. As discussed in detail in a previous publication5,

    carriers are facing pressure from several directions. They must hit the sweet spot in order

    to serve the green expectations of different players such as regulatory agencies,

    customers, shareholders, and competitors. At the same time the green endeavor should notruin the company. It is about finding the right balance, especially when it comes to the

    timelines of in-house versus external activities.

    The reader should note that activities and initiatives around Green are still in transition.

    They are shifting from an optimization-driven approach of IT systems & hardware such as

    datacenters, facilities, computers, and network systems (aka Green ICT 1.0) to beyond the

    walls of the company. The so-called Green ICT 2.0 is aiming for a birds-eye view

    perspective, going for the holistic picture with all its collateral impacts. Prime attention is

    therefore being drawn to, for instance, carbon management, embodied energy, green cities,

    smart homes, and green supply chain management.

    5

    Dr. E. Dulkeith; R. Mukherjee (Detecon): OpEx and CO2 Killing Two Birds with One Green Stone. StrategicConsiderations for incorporating Sustainability & Energy Efficiency in Access Networks, April 2010

    The participants of the green survey are the giants within the telecommunications

    industry. Their responses and the deducted patterns & trends are to be considered by

    carriers for the development of their own green endeavors and optimizations.

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    3 Perception How do you see?

    How an enterprise or individual perceives green has a large impact on their expectations,behavior, priorities, roadmaps, initiatives, etc. In the framework of this survey the term

    perception is used as an umbrella term covering awareness, perspective, definition,

    attitude, opinion, and conception. It determines how reality is seen and approached.

    When asked about their definition of Green ICT, most players answered that neither purely

    economical nor ecological definitions apply and that it was a blend of both.

    100% of the companies see Green

    defined as a blend of both green

    bucks and green trees (Figure 6).

    The majority agrees (70%) that

    although the environment is, without a

    doubt, very important, the financial

    health survival of the company is of

    higher relevance and greater priority.

    10

    00

    Economical Ecological Both

    30%

    70%

    Economical more important

    Ecological more important

    Figure 6: Cost savings dominate over environmental considerations

    In fact it is almost impossible to clearly

    separate economical & ecological

    benefits. They are just too interde-

    pendent.

    Nowadays,short-term ROI are prime directive as capital has become very

    important and budget spending has been shortened. The global economic situation

    has shifted priorities from environment comes first to reducing costs comes first. ROI

    has reached new levels of importance. Just recently, green was mainly correlated to

    power savings via AC, UPS and regulator improvements. The timeline was less urgent.

    Main focus is on economical aspects as

    they are easier to scope (OPEX). From

    certain angles there is no clear borderline. How

    to measure costs of environmental damage?

    How to accurately measure costs of sick

    employees as a result of environmental

    pollution?

    From a business perspective economicalaspects will always be of greater relevance.

    They directly impact state & health of a

    company

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    Moreover, the economic/ecological cost-benefit ratio

    strongly varies with what one looks at. There is no

    general rule applicable to all. For instance, the amount of

    efforts and investments as well as the ROI forrestructuring a datacenter or to introduce paper cups are

    not at all comparable. It is a case-by-case assessment

    and decision. The ideal situation is always to kill two

    birds with one green stone.

    When asked about the relative importance of different drivers for Green ICT most players

    answered that cost savings dominate. 8 out of 10 companies stated that reducing costs is

    the most important driver for green (Driver 1 in Figure 7)6. This is in agreement with the

    previous question. However, adding potential governmental regulations as an additional

    consideration permits more insight into the drivers for the individual companies in light of

    their core businesses.

    Those companies within the driver 1 pillar

    which have not ranked cost as the prime

    driver are either pursuing to become

    leaders in the new green niche market

    (Environment is prime driver) or

    potentially exhibit stronger cultural &

    geographical European heritages which

    could be the reason for a per se stronger

    emphasis on environmental aspects.

    Europe is known to have always drawn

    its focus more on sustainability than costsavings

    7.

    The second most important drivers (2)are equally environmental friendlinessand legal compliance as both received50% of votes each

    8. Given the back-

    ground of the companies interviewed(Figure 4) this distribution is reasonable.Those with core business aroundhardware manufacturing are mostlyconcerned by upcoming regulations and,accordingly, have primarily placed legalcompliance as the second mostimportant driver (2).

    Figure 7: Cost savings are the prime driver of green ICT

    6As will be seen later this implies that green in-house initiatives for cost-saving should come first (= reducingOpex) because any tapping into the external product line in general requires first, significant R&D investments(= increased expenses) and, second, is time consuming.

    7 REN21 Renewable Energy Policy Network for the 21st Century: Global Trends in Green Energy in 2009 and

    Global Status Report 2010, July 2010

    8Each interviewee (10 in total) was allowed to provide one complete set of ranks (First, Second, Third). Hence, the

    total yields 300% as shown in Figure Figure 7).

    Green (ICT)

    =Green (Trees + Bucks)

    Cost Savings

    Environmentally Friendly

    Legal Compliance

    Driver 1 Driver 2 Driver 3

    80%

    50%

    20%

    40%

    50%

    40%

    10%

    10%

    0%

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    The concern (and consequently the ranking) is justified as hardware is a measurable box

    with detailed technical specifications. A piece of hardware can easily be put to a pass/fail

    test, its carbon emissions can be easily determined and calculated and it can be subjected

    to enforced boundary conditions for energy-efficiency

    9

    .

    On the other hand there are significant

    challenges in determining the

    environmental impact of software or webservices. Similar to the hardware

    manufacturers and in accordance with

    their core business, all soft companies

    have chosen environmental friendliness

    to be at second position.

    The third most important driver (3) is

    again equally split between environ-

    mental friendliness and compliance with

    40% of votes each. The reader shall

    note that a clear difference between

    driver 2 and driver 3 cannot be

    concluded. Given the small sample

    number of interviewees (10, yet with

    substantial power of impact, see

    Chapter 2.2) the results of 40% and

    50% are too similar.

    9One example is the ISO 50001 (International Standards Organization) which is planned to be published in about

    a year from now (ISO 50001 on Energy Management Systems: Approved as Draft International Standard,http://www.ansi.org/news_publications, June 2010). The US Department of Energy has been one of the primary

    motivators. In light of the current popularity (and true need) for energy efficiency the development of 50001 wasshortened to 3 years (instead of regular 5 years). 50001 will become the new standard for energy management. Itwill be issued to complement ISO 9001 (quality management) and ISO 14001 (environmental management).

    From a vendor perspective our goal is tomaintain leadership in green technologies.

    It is less a question of complying with upcoming regulations but ratherparticipatingin

    creating the right set of smart regulations. We actively shape & participate in defining

    US & International governmental regulations.

    Prime directive isto comply with

    governmental regulations, international

    standards, and in best case scenario to

    exceed them significantly.

    Environmental considerations are position 3

    as they arevery hard to quantify.

    Cost savings is the carrot, compliance

    with regulations is most often rather the

    stick. Low-hanging fruits such as

    approaches that enjoy greater chances of

    approval within a company are always driven

    by short ROI and good cost-savings

    While some countries are leading & driving environmental friendly considerations forICT (e.g. Australia, UK, US, Germany) in far more countries new regulations are

    emerging. From this point of view, being compliant with emerging regulations has

    higher priority than being green.

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    It can be concluded however that cost savings is clearly perceived as the major driver while

    compliance with regulations and acting in a sustainable and environmentally friendly manner

    both share the second place.

    When asked as to how they perceive the market in terms of hype versus tangible benefits of

    Green ICT the replies were rather evenly distributed between equal, more hype, and

    more tangible with 40%, 30%, and 30% of the votes respectively (Figure 8).

    This spread should not hide the fact that all participants agree that a green hype factor exists

    in ICT and this factor is significantly greater than in other industry sectors. As the last two

    years have shown, the market has been green-washed and numerous companies have tried

    to exaggerate their position when trying to paint themselves in various shades of green.

    However, the trend is slowly shifting from equal towards more tangible.

    Also, during the conversations with the

    interviewees it was mentioned that hype triggers

    confusion. The current situation where no

    standards, benchmarks, and references are

    readily available to establish the basis for an

    objective assessment and comparison makes it

    challenging to demonstrate green tangibility.

    Figure 8: Even spread of hype & tangibility in

    the market yet as function of target group

    This confusion sometimes causes sales and

    marketing to make (almost) arbitrary green

    statements, smearing out the different shades of

    green, because they did not know any better

    (and partly getting away with it).

    When setting green priorities carriers should assess the scope & nature of their assets.

    Even though cost savings are prime directive the degree of regulatory impact can vary

    significantly. VNOs and ISPs with only moderate hardware assets can be less

    concerned about legal compliance whereas local incumbents should be alerted.

    Vendors often offer hype;

    technology companiesare in

    general more tangible and"down-

    to-earth"because their claims for

    energy-efficiency aremeasurable.

    Clearly, the market is confused. There is

    lots of green washing and also not all green

    comparisons are actually fair. What is

    missing is a3rd party objective

    evaluation.

    30%Equal

    40%

    More tangible

    30%

    More hype

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    Another point worth emphasizing is that several companies responded to the hype question

    by breaking it into different target groups. In consensus, more hype is seen in conjunction

    with end-consumers while the business space is associated with more tangible benefits.

    When asked about their opinion on how the customer/end-consumer perceives Green and

    whether a positive perception by the end consumer may show positive impacts on revenue,

    most players replied in the negative.

    Most interviewees felt that consumers are not willing to accept reduced performance (saving

    energy) in order to contribute to an environmental friendly behavior (0%, Figure 9). 90% of

    all companies agree upon that the consumer looks at the carrier and expects green new

    products without any sacrifices in performance at all. As will be discussed later, the end-

    consumers are seen as the second strongest group to push green changes (Figure 15).

    Sensitized & expects green ecologicaladvances

    Willing to accept performancedrawbacks for being green

    Sensitized & expects green ecologicaladvances

    Not willing to accept performancedrawbacks for being green

    Frustrated & confused by exaggerated

    green-washing attempts throughout allmarket segments

    Ignoring green aspects aspurchase criteria as he/she cannotdistinguish between hype and reality

    Sensitized & expects green ecologicaladvances

    Willing to accept performancedrawbacks for being green

    Sensitized & expects green ecologicaladvances

    Not willing to accept performancedrawbacks for being green

    Frustrated & confused by exaggerated

    green-washing attempts throughout allmarket segments

    Ignoring green aspects aspurchase criteria as he/she cannotdistinguish between hype and reality

    2

    9

    0

    Figure 9: No end-consumer will accept performance drawbacks for being green

    The green market still suffers from a lack of

    tangibility. Facts and hard numbers are the only

    way to objectively distinguish between hype and

    reality. Although slowly emerging, there are no

    global standards, benchmarks and references yet

    to create an objective assessment andcomparison. This is still up to the company.

    Lots of clients for services and

    business solutions are clearly

    aware of the necessity of

    efficiency benefits yet it is not

    clear and still challenging to

    determine how large the greenbenefits are. This is the biggest

    challenge: How to measure it?

    From a technological perspective one should always perform adirect side-by-side

    vendor comparison of products. This helps to better identify real tangible benefits.

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    20% see the situation as being even

    worse. Consumers have identified false

    sales messages and have become

    skeptical. Yet they cannot distinguishbetween hype and reality, and hence,

    will not implement green aspects into

    their purchase criteria at all10

    .

    In general, green is not seen as a feature where consumers are willing to pay a significant

    premium fee. The private end-consumer does not and cannot think in ROI terms, and hence

    exhibit only limited willingness to pay a premium for the moment (if at all and even then only

    a minor one). This is very different for companies. Considerations of special agreements

    along the supply chain could be taken into consideration and could potentially be used tocompensate & balance each other e.g. costs for R&D in product advances from the

    manufacturers side against OPEX reductions in the carrier network. This should be

    communicated to manufacturers and carriers.

    10The reason for having a total of 110% in Figure 9 is the result of one company differentiating its answers bygeographical region stating that customers in Asia are leading edge with communication technology, hence, havehigh standards and do not accept any performance drawback at all (answer not willing).

    On the other hand, other regions may never have really cared (answer ignorant) simply because the majority ofenergy has always been green, for instance from wind, water, solar, and geothermal sources. From anenvironmental perspective any high power consumption has never really been an issue.

    An example ofsaturatedcustomers has

    been the Apple commercials about green

    laptops. Sales went down. Apple returnedto the original campaign communicating

    high-end products to an exclusive group

    Silicon Valley players feel that end-consumers will not accept any premium-fee or

    performance drop for the sake of being green. Carriers have to bear this in mind.

    100% of companies agree that end-consumer have the final word. They decide if a

    green product & service will shine or flop.

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    4 Approach How do you address?

    The perception of a company on market and target groups is essential. But equallyimportant is the approach adopted to address the situation. This chapter deals with

    questions around the green approaches of the Silicon Valley players.

    When asked about which business segment will Green ICT have a larger impact on more

    than twice as many companies (70% versus 30%) responded that it will be the technology

    that drives Green ICT.

    It means that the majority of interviewees see

    new technologies as being the enabler for

    new services and only then impacting

    business. As an example, while a business

    concept & case for teleportation might be

    available, without technology to realize this

    idea, it will never have any impact. It should

    be noted that the answers shown in Figure

    Figure 10 show no correlation to the core

    business of the companies. The responses

    from soft and hard companies are equally

    distributed throughout the 100%.

    Figure 10: Technology is the field where

    Green ICT will show the largest impact

    Technology

    Business

    70%

    30%

    New business

    approaches/

    solutions must be

    enabled by

    technologyfirst;

    hence, the impact

    commences in

    technology

    Technology enables new

    business and services. The

    larger impact, at least for the

    years to come, will be in the

    technology sector.

    Technologyis the

    enabling/driving

    innovation force for

    new services and

    with this carries a

    large impacton

    Green ICT

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    When asked to name specific sectors within the technology segment where green activities

    are expected to make an impact again three answers dominated the responses11

    :

    Energy Management on Software Level with 7 out of 10. Energy efficienthardware is only effective as long as it is being intelligently managed. This is

    not essential for a single box, but for a nationwide (or global) carrier network

    intelligent management via smart software that orchestrates all components in

    a harmonic way is a key vision for any telecommunications operator. This is not

    only true for carriers but also true for any company with large numbers of

    employees (which implies at least an extensive internal network and many

    desktops and laptops).

    Data Center Optimization with 6 out of 10. As DCs are not exclusive to

    carriers the optimization is seen as a key activity field. It should be noted

    though that here there is a fundamental difference to carriers. While the

    majority of participants certainly have their own data centers to manage,operate, and maintain, none of them owns a nationwide telecommunications

    network. As explained in a recent Detecon publication12

    , it is the network itself

    (combined hardware and software in the access, aggregation, and core) that is

    the main contributor to a carriers energy bill.

    Energy-Efficient Hardware with 5 out of 10. Advancements in hardware are

    the fundamental ingredients for any sustainability & energy-efficiency

    approach. Having the same hardware offering the same performance and

    yet consuming only a fraction of the power the previous model consumed is the

    perennial goal. Without improved power consumption at the hardware level,

    intelligent software can barely make a difference without impairing the

    performance. One clear path the industry is walking and intensively pushing isthe development of silicon photonics

    13and next-generation multi-core

    processors14

    .

    11R&D was not added as an option. Any advancement in technology commences with R&D, hence, it is taken forgranted to be an essential part of most technology activities. For instance, without R&D neither advancedtechnology can be designed nor software developed. However, several companies still commented RD andmentioned that R&D is a key ingredient and activity field within technology.

    12Dr. E. Dulkeith; R. Mukherjee (Detecon): OpEx and CO2 Killing Two Birds with One Green Stone. StrategicConsiderations for incorporating Sustainability & Energy Efficiency in Access Networks, April 2010

    13Dr. E. Dulkeith; Dr. K. Grunert; S. van-der Merwe (Detecon): Photonic Packet Switching and the Evolution ofOptical Networks, November 2008

    14Dr. E. Dulkeith; Dr. Dominik Schmidt (Detecon/Intel): Convergence on a Chip: Potential Opportunities for TelcoIndustry, August 2007

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    50%

    20%

    10%

    Data Center

    Optimization

    Energy Efficient

    Hardware

    60%

    Sustainability

    Certificates

    Recyclable

    Materials

    30%

    20%

    Network

    Storage

    Systems

    Energy

    Management on

    Software Level

    70%

    Carrier Networks

    Energy Audit

    20%

    Operational

    Strategies

    Substitution Products

    & Services

    10%

    Alternative Energy

    Sources

    10%

    In general, the aim isto stay at the leading

    edge ofenvironmental friendlycompliance standards

    & sustainabilitycertificates. One has

    to gobeyond theEnergy-Star.

    Figure 11: What are the prime green activity fields within the technology sector

    Figure 11 shows that more than 60% of all responses (on average) regarding key activity

    fields in technology are assigned to the above three categories15

    . At the low end of the

    ranking, alternative energy, carrier network energy audits and substitution products can be

    found (all 10%). A few further notes/comments are given for clarification:

    Alternative Energy: 10% of all

    companies actively checked

    alternative energy. However, 30%

    are commenting in addition on this

    topic. It is common sense that such

    approaches will have major impact,

    yet are still in an early stage.

    Furthermore, they require large

    investments and are therefore not

    seen as key activity fields of today.

    Also, most likely this is more seen

    as the responsibility of energy

    providers to come up with solutions.

    15

    Similar to previous questions, each participant was allowed to give 3 answers. This yields a total of 3x10responses which was set equal to 300% as a total. This means that the sum of, for instance, DC (60%),Hardware (50%) and Software (70%) equals 180%/300% = 60% of all answers.

    Another emerging activity isdynamic

    pricing of energy; the purchase is

    similar to the stock market. The better you

    know your systems and can predict power

    peaks, the easier it will become to go for

    cheap power shopping.

    In the long run the implementation of

    alternative energy sourceswill have a

    strong impact yet they are currently in a

    too early stageto be a key activity fieldof today.

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    Network Energy Audits: Auditing the network of

    carriers, conducting gap analysis and providing vendor

    efficiency-matrix is ranked low (10%). Similar to thedata centers argument, none of the participants are

    carriers; hence none own extended network

    infrastructures. The participants are positioned along

    the supply chain of carriers. Independent studies

    together with dedicated conference sessions stressed

    that a large number of carriers may know on a high

    level where the energy is consumed in their network,

    yet lack any details and in particular approaches how

    to address such hot spots16,17

    . From a carriers

    perspective there is a genuine need to resolve this

    issue. Vendors and manufacturers can act as usefulsources of information when it comes to the

    hardware/software assessment.

    Holistic & Unified: 50% of

    all comments by companies

    refer to terms such asholistic, unified, big

    picture, beyond empha-

    sizing that a patchwork-like

    approach will have a rather

    limited positive green impact.

    16Warren Wilson, Sustainability Management: An Opportunity for CIOs, Jan 2010

    17 Green Telecom East Conference: Transitioning to Environmentally Responsible Networks, New York City, June2009

    Next-Gen Energy

    Efficiency: It is a

    holistic & systematic

    approach to optimize

    cross-layer device-

    communication in

    networks. It spans over

    access, transport &

    core; addressing

    hardware, software, and

    subsystem levels.

    The emerging generation ofoptical communicationstechnology based on

    silicon photonicswill have major impact on telecommunications.

    The supply chain of a carrier focuses on optimization of software & hardware.To create synergy and achieve the most in the shortest time possible, carriers

    should aim for a strong overlap between their own green activities with those of

    vendors and manufactures of network components and end-consumer devices.

    In order to match product life cycle with green savings, detailed roadmaps (down to

    the module/chip level) and knowledge needs to be exchanged.

    Outsourcing Services,

    Energy Management

    and in particular

    consolidated &

    unifiedcommunication

    including control ofIT

    &facilitieswill

    become very

    important.

    Instrumentation is

    needed for

    common

    measurement &

    control of

    network

    technology and

    beyond; covering

    even facility

    equipment.

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    When asked to name specific sectors within the business segment where green activities

    are expected to make an impact three answers dominated the responses (Figure 12):

    R&D/Innovation with 8 out of 10. There is a common agreement that

    increased efficiency starts at the very source i.e. Research & Development. It

    is not a simple switch to be flipped; it has to be developed from scratch and

    usually comes with high investments. The majority of carriers do not participate

    in this field. It is primarily in the hands of manufacturers.

    Costs/ROI with 8 out of 10. How does one get their investment back? This is

    a valid question for everyone, not only vendors and manufacturers but also for

    carriers. However, it is in particular relevant and challenging for manufacturers

    as they usually carry the up-front R&D costs. As discussed before with the

    perception of end-consumers (not seeing green as a feature willing to pay a

    premium for), a similar attitude is surrounding carriers. A later question willaddress the expectations along the supply chain.

    Procurement Design & Purchase Criteria with 6 out of 10. This activity is

    commonly seen as how to shop green - regardless of whether it is for discrete

    components (like processors), end-consumer products & services, software, or

    network elements, etcProcurement Design and defining purchase criteria

    addressing sustainability is the first step in "greening the supply chain".

    Note that above answers (60% - 80%) have been chosen up to 2 - 8 times more often than

    any alternative (10% - 30%), showing a clear preference of the Silicon Valley players18.

    80%

    60%

    80%

    20%

    10%

    R&D / Innovation

    Procurement Design,

    Purchase CriteriaROI and CostCalculations

    Organizational

    Restructuring

    BestPractice

    Development30%

    PR

    20%

    Product SalesApproaches

    Assessembodied energy;the strictcontrol of generated carbon emission

    on a component level of products alongtheentire supply chainincluding

    manufacturing line.

    Innovationon the businesslevel is crucial

    Partner with suppliersforalternative energy

    Figure 12: What are the prime green activity fields within the business sector

    18Each participant was allowed to give 3 answers. This yields a total of 3x10 responses which was set equal to300% as a total.

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    Looking at the very end of the rankings, the fields of activities which are not seen as being

    key are PR and product sales approaches. 80 - 90 % of all participants did not vote for them.

    As explained in the introduction of this document, the Silicon Valley community has become

    cautious and rather prefers to walk the talk, then announce achievement instead ofcommunicating future yet to be realized plans and goals.

    When asked about organizational approaches such as milestones and timelines

    implemented by their organizations 100% of all interviewees responded that:

    Their company has already started sustainability approaches for variousreasons (driven by competition, environmental responsibility, market shift to

    mobile, recycling regulations, customer push driven, etc.) before the green

    hype started for at least 5 years.

    Their company has established a core team (Figure 3) with 10 to 20 members

    supported by 100s to 1000s of volunteers within the company (scales with the

    overall size of the company).

    Their company is trying to distinguish between short and long term goals. 90%

    have milestones and timelines established and these are a part of their CSR

    reports (Corporate Social Responsibility).

    Optimize supply chain and define green purchase criteria (code of conduct).

    Analyze and balance cost factors for going green.

    Removing plastic cups and reducing

    print-outs is without doubt honorable,

    helpful, expected and positive from a

    marketing and branding perspective, but

    the real green impact is still limited.

    Our overallin-houseenergy

    consumptionrelates to only1%compared to the99%energy

    consumption triggeredby our products

    at clients sites.

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    Lastly when asked about whether any particular approach might be the most promising to

    address Green ICT most interviewees responded that internal changes offered the brightest

    immediate prospects.

    Eight of ten companies (80%) agreed that one has to

    draw their attention first to internal changes (Figure 13).

    The other 20% stated that one should work in parallel,

    internally (in-house) and externally (facing the market).

    Figure 13: To start with internal green

    changes is the preferred approach

    This confirms what has

    been mentioned in the

    Introduction and also the

    end-consumer perception

    as shown in Figure Figure

    9. Inde-pendent of B2B or

    B2C, customers still have a

    bitter after-taste of the

    previous 2 years. Too many

    companies exaggerated

    their green efforts in order

    to win over environmentally-

    concerned target groups.

    80%

    20%

    Mostly Internal Changes

    Both Internal & External Changes

    The market has

    beengreen-

    washeda lot. It

    is advisable to

    start within-houseCO2

    footprint

    reductionsfirst.

    First do it and then talk

    about it. Not the other way

    round.

    Approaches for the external

    market have tofollowinternal

    changes.

    Walk the talk before commencing market-oriented

    campaigns & announcements. Dont try to create positive

    public awareness if it is still messy behind the curtain.

    Prime attention should be around in-house initiatives.

    Both apply in terms of education but not regarding

    marketing initiatives. One should only commence

    marketing campaigns once you are clean & compliant"

    from an in-house perspective.

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    5 Activities What do you do?

    This chapter covers all questions related to the specific activities. This is the logicalprogression after having assessed the definition of sustainability & energy-efficiency (given

    ones own core business) and accordingly determined the approach.

    5.1 External Facing Market

    External activities are initiatives that are meant to address the market - either from a

    customer-facing perspective or in the opposite direction along the supply chain. Figure 14

    gives an overview of activities of all participants.

    Behavioral Changes

    Hardware Changes

    Software Changes

    Knowledge Sharing

    Market externalactivities, products &

    services

    Multi-thread server

    systems

    ManufacturingOptimization

    Supply Chain Greening

    Smart Processors

    DC Consolidation

    TelePresence

    Multi-Mode

    Operation Routers

    POP Virtualization

    ApplicationDevelopmentTools

    Telephony SoftClients

    CarbonFootprintCalculations

    Eco Incentives

    ProductEfficiency Assurance

    Green P&SRankingPaperless Billing

    Audit andCompliance

    Dynamic EnergyPricing

    CommunityInvolvement

    CSR Reports

    Web Energy

    Calculator

    Internet Portal CustomerEducation

    Carbon Consulting & Intelligence

    Public TransportationSuggestions

    Community

    Opportunities

    Impacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Impacts?

    Efforts?Roadblocks?

    Liquid

    Cooling

    Virtualization Services &Utilization Enhancement

    Corporate Vehicles

    Facility Control

    Network

    EnergyManagement

    Biodegradablepackaging

    Home

    Automation

    SiliconNanophotonics

    GreenEthernet

    Device

    Energy Management

    Alternativeenergy

    Partnerships & Alliances

    Code of ConductImpacts?Efforts?

    Roadblocks?

    Innovative product

    designs

    Behavioral Changes

    Hardware Changes

    Software Changes

    Knowledge Sharing

    Market externalactivities, products &

    services

    Multi-thread server

    systems

    ManufacturingOptimization

    Supply Chain Greening

    Smart Processors

    DC Consolidation

    TelePresence

    Multi-Mode

    Operation Routers

    POP Virtualization

    ApplicationDevelopmentTools

    Telephony SoftClients

    CarbonFootprintCalculations

    Eco Incentives

    ProductEfficiency Assurance

    Green P&SRankingPaperless Billing

    Audit andCompliance

    Dynamic EnergyPricing

    CommunityInvolvement

    CSR Reports

    Web Energy

    Calculator

    Internet Portal CustomerEducation

    Carbon Consulting & Intelligence

    Public TransportationSuggestions

    Community

    Opportunities

    Impacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Impacts?

    Efforts?Roadblocks?

    Liquid

    Cooling

    Virtualization Services &Utilization Enhancement

    Corporate Vehicles

    Facility Control

    Network

    EnergyManagement

    Biodegradablepackaging

    Home

    Automation

    SiliconNanophotonics

    GreenEthernet

    Device

    Energy Management

    Alternativeenergy

    Partnerships & Alliances

    Code of ConductImpacts?Efforts?

    Roadblocks?

    Innovative product

    designs

    Market externalactivities, products &

    services

    Market externalactivities, products &

    services

    Multi-thread server

    systems

    ManufacturingOptimization

    Supply Chain Greening

    Smart Processors

    DC Consolidation

    TelePresence

    Multi-Mode

    Operation Routers

    POP Virtualization

    ApplicationDevelopmentTools

    Telephony SoftClients

    CarbonFootprintCalculations

    Eco Incentives

    ProductEfficiency Assurance

    Green P&SRankingPaperless Billing

    Audit andCompliance

    Dynamic EnergyPricing

    CommunityInvolvement

    CSR Reports

    Web Energy

    Calculator

    Internet Portal CustomerEducation

    Carbon Consulting & Intelligence

    Public TransportationSuggestions

    Community

    Opportunities

    Impacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Impacts?

    Efforts?Roadblocks?

    Impacts?

    Efforts?Roadblocks?

    Liquid

    Cooling

    Virtualization Services &Utilization Enhancement

    Corporate Vehicles

    Facility Control

    Network

    EnergyManagement

    Biodegradablepackaging

    Home

    Automation

    SiliconNanophotonics

    GreenEthernet

    Device

    Energy Management

    Alternativeenergy

    Partnerships & Alliances

    Code of ConductImpacts?Efforts?

    Roadblocks?

    Impacts?Efforts?

    Roadblocks?

    Innovative product

    designs

    Figure 14: Market-facing activities of the interviewed companies

    The activities are grouped into 4 categories - changes in behavior (e.g. CSR, awareness

    creation, code of conducts, community, etc), in software (e.g. shift of services from

    hardware to software, energy management tools, etc), in hardware (new technologies,

    expanding business, upgrades, replacements, comparison sheets, etc...), and sharing of

    knowledge (insights, how-to, customer education, support of clients beyond the own good,

    etc..). It should be noted that none of the above can be directly compared to each other in

    terms of impact, efforts, or potential roadblocks and hurdles. As we will see later in the

    financial section, each activity has to be assessed individually.

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    When asked as to whose main responsibility in the market should it be to push and/or force

    Green ICT implementation the answers received were mixed.

    There are two primary activities in the green space, to actively push/request green changesor actively realize those changes. Figure 15 gives an overview. The responses are sorted by

    their role within the supply chain. Also, the results are normalized to Carrier/ISP to facilitate

    comparison.

    3.02.5

    1.01.02.0

    GovernmentEnd UserCarrier/ISPTelco VendorManufacturer

    Governments & End Users

    Pressuring Carriers to Act

    SUPPLY CHAIN

    Manufacturers & Vendors Face

    Pressure from Large Carriers

    Carriers FulfillImportant Enabling

    Role

    Impose

    1.5 (All)

    Figure 15: Responsibilities to push green implementations (along the supply chain)

    Top ranked with the highest responsibility is the

    government with its power to enact nationwide

    regulations and standards. Equally important is the

    ability to impose penalties & fines in case of disregard.

    The government as the prime entity for green

    responsibility was chosen 3 times more often than

    carriers.

    Second highest ranking was for end users with a factor

    of 2.5 beyond the carrier. Given they are located at the

    very end of the supply chain19 the end users are seen asthe group with largest responsibility & ability to "push"

    and create action in the market. Referring to Chapter 3

    (Perception), the end users have the final word. It is

    simply a case of supply & demand. In case a product is

    not appealing enough pricewise or from an

    environmental perspective he/she is not going to

    purchase it.

    19The government occupies a rather umbrella-like big brother function across the supply chain.

    2/3 of RfP haveenergy

    relatedrequests (REQ)and questions (RFI) and

    quickly growing in scope.

    Governments are

    pushing this

    development.

    End users canpush, the

    Government canforce

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    A few activities are overlapping with the market-oriented activities as they can be applied to

    both fields and are simultaneously beneficial to employees as well as customers. Prominent

    examples with a 100% spread throughout all interviewed companies are for instance:

    Virtualization

    Energy Management Software

    TelePresence

    Awareness Creation

    Waste & Illumination Management

    5.3 Financial ROI & TCO

    Occupying a hybrid position between market-facing activities and

    internal decision making, green financials are described in this

    separate chapter. At a glance, there is no common denominator,

    no guideline and no best practice. Answers from participants

    were diverse, with the argument that financial evaluations arevery much a case-by-case decision instead of applying one strict

    threshold and formula.

    When asked if they were willing to accept an

    increased CapEx (i.e. spending a premium on

    hardware, software, or services) answers were

    equally split (20% voting) between Yes,

    between 10-30% and No. The majority (60%)

    gave alternative answers, ranging from focusing

    preferably on TCO to 5% (hardware) and 10%(services), to skipping the questions (citing

    confidentiality).

    Demand Response Energy Curtailment:

    Electricity providers call out for power

    reduction during peak demand. As an

    incentive, discount on electricity are offered.

    Flexible workspace philosophy(Open Work): Employees can work from home. This

    increases satisfaction, balances families, increases productivity, and saves expenses forfacilities. Teleworkingandshared officesapproaches are popular. About 40% of all

    employees do not have an office.

    This really depends on the

    product/components and its product

    life cycle. There is no fixed

    rule/number. Sometimes a new

    technology can be as much as twice

    expensive, yet offers an extremely lowOPEX.

    There isno need

    for premiumfee,

    enough low

    hanging fruits are

    available = quick

    wins.

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    Questions regarding how much savings in OpEx are anticipated when implementing Green

    technology revealed the similar results: no clear pattern with an equal number of companies

    anticipating around 10% and 20% in OpEx savings. Again 60% of respondents gave

    alternative answers (Figure 19).

    The range of products, components, and technology is too diverse to give a simple rule of

    thumb. One cannot lump them together by using the same approach. For instance, a power

    management tool for 1000s of desktops may carry relatively little CapEx, has negligible

    OpEx, but can add up to significant savings in a short time. This must be treated differently

    to a multi-million dollar upgrade of a data center. As a consequence, the answer for the ROI

    of a green product/service/component varies between 6 months and 5 years.

    Although difficult to quantify by means of a hard number, all companies have significantlyincreased their efforts and resources for energy-efficiency and sustainability compared to

    the previous years.

    Milestones to improveenergy-efficiency of

    our productsshould be set toat least 30-40%.

    Indirect improvements (e.g. using 3rd party

    next-gen processors) can already trigger20%

    by itself. Otherwise the own company hasno

    own green contributionHowever, it comes

    along with major investments.

    20%

    20%60%Other 20%

    10%

    Figure 19: No clear pattern and rule ofthumb for expected savings in OpEx

    Carriers should not apply a cookie-cutter approach when it comes to cost

    calculations.

    The impact of a green purchase has to be assessed in an individual yet holistic

    way, and also taking into account potential penalties in case non-compliance

    with governmental thresholds.

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    6 Conclusion The Green Hype Split

    In light of the answers received in this survey and the green activities of companies (thatappear to be of rather discreet nature see Chapter 2.1), the current market situation for

    energy efficiency & sustainability can be described in two ways: the green hype is over and

    yet the recovery to a realistic situation will take place on split timelines: in-house (internal)

    facing initiatives and activities and market/product facing activities and announcements.

    To better visualize the green market and its progression in time the hype cycle is used as

    template21

    . However, certain adjustments are necessary. In case of green, and as shown in

    Figure 20 the hype cycle splits up into 2 different recovery slopes.

    Past Years: Back in 2008 the emerging green hype was successfully wrapping the market

    into a green cloak triggering and causing a severe loss of transparency. The attempts by

    companies - in all industry sectors - to improve their image through positive green branding

    was pushed too hard, stretched too far and was blown out of proportion. An automobile with

    a gas mileage of 14 MPG (bad) now improved to 20 (still bad) was acclaimed by marketing

    as ergonomic & green. Plastic wrapping degrading in only 100 years (instead of 500) was

    now environmental friendly. Also the T.I.M.E (telecommunication, IT, media, and

    entertainment) markets participated (at least partially). A significant number of market

    players were happily riding the green wave, believing to have found a new angle for selling

    their products a new USP (Unique Selling Point).

    But the chase to win & retain customers by addressing their environmental soft spot went out

    of control. The situation escalated and the peak of exaggeration was reached sometime

    back at the beginning of 2009.

    Time

    Visibility

    Market (external)

    In-House (internal)

    Spark

    Outbreak

    Spreadsupported

    by Hype

    Peak of Exaggeration

    Onset ofImmunity

    Stability

    FastContagion

    Dull&

    Blunt

    Stability

    Recovery

    Dull&

    Blunt

    Onset ofNormalization

    short -term mid-term long-term

    EstablishedBusiness

    2009 20102008

    TODAY

    TODAY

    Recovery

    Figure 20: The hype cycle splits into 2 curves with both having different recovery times

    21http://www.gartner.com/it/products/research/methodologies/research_hype.jsp

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    Shortly after this the green bubble imploded. At that time it was challenging for customers

    and consumers to tell the differences between the marginal shades of green. Exaggeration

    used by marketing triggered an industry-wide loss of credibility and pushed consumers into a

    blunt and dull state. They entered the next stage: Immunity.

    The hype cycle has now split into two curves (Figure 20). The lower one describes external-

    facing green initiatives including marketing announcements and campaigns. The upper curve

    represents all green in-house (internal) related activities including community involvement.

    The reason for the split and in particular for the low position of the market curve is because

    of the lessons-learned companies from various industry sectors have experienced. They

    received bad publicity by having launched deceptive advertising or publicly announced

    environmental-friendly actions (and not living up to them); essentially overpromising and then

    under-delivering. Consequently, market-facing green campaigns now have only a limited

    positive impact on branding; simply as a result of green-washing and the fact that too many

    companies tried too hard. Naturally, the most promising spots to look for improvements werethrough in-house operations on both the business and the technology level.

    Today & Tomorrow: Quiet is the new loud. As mentioned in the introduction, it has become

    less noisy around energy-efficiency & sustainability in ICT. But this silence does not reflect a

    decline in green activities but rather shows that companies have redrawn their focus to in-

    house initiatives. Given the disillusioning hype which affected customers, shareholders, and

    even raised the interest of regularity authorities, todays prime directive is to put ones own

    house in order first before going on stage and claiming to be green. Too many (sensitized)

    different interest groups are observing and monitoring the companies far too closely.

    As a consequence, in-house facing initiatives are recovering fast and will soon reach a

    normal and stable reality. This will happen presumably in 1-2 years from now (which

    coincides with estimated timelines for carbon emission related laws & penalties).

    The recovery of the market-facing hype curve will take longer. As a matter of fact, it is

    strongly related to the timelines for R&D of new technologies, and consequently the timelines

    for large investments. As this does not happen overnight, any significant breakthroughs (e.g.

    decline of power consumption of 20-30% while maintaining the same performance) are

    estimated to take place in the next 2-4 years. High levels of activity on the product and

    service level are indeed present, but behind closed doors and with few (if any)

    announcements. As mentioned earlier, sustainability and environmental-friendliness is not a

    switch that can be flipped. It does not work for cars and neither does it work for end-

    consumer devices and telco equipment.

    Sustainability and Energy Efficiency is not a trend that will vanish anytime soon. It is an

    emerging industry sector.

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    7 The Authors

    Dr. Eric Dulkeith is member of the Strategy & Innovation Group in Detecons Silicon Valleyoffice in San Francisco, California and is the core topic leader of Green ICT. The main focus

    of his activities is on innovation management and business development of converging

    technologies and markets. Before joining Detecon, he worked at IBM Watson Research

    Center in New York on future optical on-chip communication architectures. He was awarded

    the degree of Ph.D. in Physics from the University of Munich (LMU) for his work on

    nanosensor technology. He is the author of numerous publications and has given more than

    30 written/oral contributions for international technology magazines, conferences, and

    workshops.

    Eric Dulkeith can be reached at [email protected]

    Rajat Mukherjee is member of the Strategy & Innovation Group in Detecons Silicon Valley

    office in San Francisco, California. He is also a member of the Mobile Internet Center of

    Excellence at Detecon International GmbH. He was awarded a Bachelors degree in

    Electrical Engineering (Honors) by McGill University in Montreal, Canada and a Masters

    degree in Management Science and Engineering by Stanford University in Palo Alto, USA.

    His prior work in the telecommunications industry has focused on next generation access

    and convergence technologies. He is the co-author of numerous patents pending with the

    US Patent and Trademark Office on various aspects of ICT technology. His current work atDetecon is on best practices in products and services launch management and on

    innovation strategies for future telecommunications networks.

    Rajat Mukherjee can be reached at [email protected]

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