Keri Gilder, CEO of Colt Technology Services, talks to Annie Turner about the company’s milestone year, AI and network architecture, NaaS, collaboration and much more
Keri Gilder has been Colt Technology Services’ CEO since May 2020, and before that served as its Chief Commercial Officer from 2018. 2023 In November, Colt completed its acquisition of Lumen’s business and assets in Europe, the Middle East and Africa (EMEA) for €1.65 billion ($1.8 billion), making 2023 a milestone year.
Colt business model is unusual in that it is B2B only. Between 65 and 70% of Colt’s overall business is direct enterprise. The rest is split between strategic wholesale players. Some are other network operators, others global content players and hyperscalers. The acquisition brings Colt 2,700 customers including blue chip corporations, enterprises and public sector customers. Colt will expand its coverage via PoPs in Dubai, Estonia, Greece, Iceland, Israel, Kenya, Serbia, Slovenia, South Africa and Turkey.
Gilder herself is a trailblazer, most obviously because few women head up telcos, although that cohort is growing rapidly.* Also, she prioritises company culture, which at this juncture is critical. She notes that only about 5% of mergers are really successful “because very few companies take the culture piece of it seriously when it’s actually the only thing that matters”.
She has long been a strong advocate for diversity and inclusion as critical success factors in telecoms (and beyond) and acts on her conviction. For example, she was appointed chair of TM Forum’s Diversity & Inclusion Council in 2020 and we began our interview with Gilder talking about teaching culture courses for the Pacific Telecommunications Council (PTC), including for younger people entering the industry.
Sending signals
She says she’s learned “a lot about what culture is – and isn’t.” I love David Foster Wallace’s analogy of two young fish being asked by an older one swimming by, “How’s the water?”. One youngster looks at the other and asks, “What’s…water?”. Culture, like water to the fish, is fundamental, yet we are mostly oblivious of it and its profound importance
This is why, as Gilder says, “it’s the hard stuff…You can write a mission statement…you can put your values up there, but…if you don’t follow them, they’re meaningless.” She adds, “You can put the ping-pong table and cafe in the basement but it’s the signals you send out around decision making, how you react in certain situations, who you listen to within an organisation for direction – whether they are in the hierarchically or not – those are the things that matter.”
Ahead of the Lumen acquisition, Colt carried out a culture survey. She was “pretty proud” that more than 5,000 people within Colt filled in the survey and scored more than 33 points higher than the highest performing companies. Gilder states, “So I feel like we figured it out on the Colt side, now, we ‘just’ need to make sure that we take that manage that magic formula and take into consideration the good stuff on Lumen’s side and bring it over, making sure we blend it in, in some form or fashion.”
Scale and collaboration
Why did Colt acquire Lumen’s EMEA operations and assets? Gilder says, “In an ever more commoditised environment, when it comes to connectivity scale matters. This…makes us the largest pan-European B2B fibre operator and one of the largest B2B-only operators in the world. So, from a scale perspective, there’s a lot of value and leverage we’re going to gain.”
Another major attraction was Lumen’s Tier 1 autonomous platform which Colt now co-owns. Gilder says, “So the second piece, beyond scale, is collaboration. That and the platform are driving a true partnership with Lumen in North America and with other operators around the world, because it provides us with something like 300 million BGP [border gateway protocol] peering points globally.
“This gives us a lot more capability to reach different areas outside EMEA. I think that’s going to be important, especially as AI comes to the mix and the IP points become very important from a wholesale perspective, and from an enterprise perspective.”
AI’s impact on business and the network
What impact will AI have on Colt’s business and assets? Gilder says, “I think that [some] people are claiming expertise where they shouldn’t. I definitely don’t claim to be an AI expert, but what I do know is that AI requires a different network architecture than we have today. So we’re starting to think about that very differently. Our strong feeling is that AI requires what I’m coining [the term] a hypermesh, metro environment.
“It requires a lot of capillaries to various points. Where those peering points come in as IP addresses, there’s data that can be used in an AI learning environment – a large model language environment or narrow language environment, whatever it is. Number one, we have to think about the scale of the BGP peering points but we also have to think about fibre’s scale to the points, to get connectivity to where it needs to be in a low latency environment, as well as outside the major data centres.”
Gilder expects that AI will “live everywhere and wherever it lives, it’s going to put a lot of stress on the digital ecosystem. From a power perspective in particular, I think we have to think differently about edge computing, where it is and how it is being used. We also have to create those edge points so that the data can be served closer to [its destination].”
Right now, she says, “We’re looking at a completely different AI based, AI-centred architecture in Frankfurt, Germany. It’s different from the traditional networks we’ve deployed. I’m thinking about it from the physical fibre environment and where the data is going to be consumed. How do we enable that quickly and in a low latency environment?”
Edgy predictions?
The edge has proved elusive and progress much slower than expected. Gilder states, “I think AI will be the catalyst for edge…Probably in first instance, it will be deployed in a private AI way, where you have hosted applications at an edge, which could be a colocation site of a network. It’s possible, wherever you have power could be an edge and applications – or data – could be hosted there. That’s how we have to think about it.”
Gilder believes that pharmaceuticals “are a perfect example” of an edge use case because “you have lab tests and lab environments going on all over the world. You’re going to need big data centre to crunch the data, but you’re also going to need a certain proportion that you can use in your labs that should be closer. Companies will have to work between the two. We’ve already seen that with some of the protein work that AstraZeneca did during COVID. So that’s one example, but I think there are many.
“Companies are going to choose portions of data and where they reside based upon native use associated with a particular data lake or sub-lake. I also think it’s more sustainable from an environmental perspective. It also helps us to meet some of the ESG [environmental social governance] requirements we have, and to hold ourselves a little more accountable than we currently are.”
Formal participation in ecosystems
While Gilder talks up collaboration and partnerships, Colt is not so involved in the GSMA’s Open Gateway initiative because “it’s more about mobile operators” but it is engaged with TM Forum and more recently MEF [formerly the Metropolitan Ethernet Forum], looking at Network-as-a-Service and how it can be served as a platform via multiple operators.
She notes, “These discussions are happening. On paper, they look really good and I do think there’s a need for them but the question in my mind still is that I’ve been working with various operators for almost three years now and thinking about a larger open platform and how that could work.
“But there still seems to be this very strong desire to control the narrative by various operators, so it seems really difficult to get past the technically it’s possible. Technically, we could roll it out today; commercially it becomes very, very complicated.
Three is a magic number
The third big gain for Colt from the Lumen acquisition is the capabilities of Lumen’s EMEA staff, according to Gilder. Colt has purchased 10 transatlantic subsea systems and 11 landing stations, which are new assets and businesses for Colt to manage. “These, combined with the massive fibre infrastructure we have for backhaul, we will be able to accommodate the 70-plus cable systems that are going to be connecting into Europe, the Middle East and Africa over the course of the next seven to 10 years,” she says.
“There’s a big impact on Europe, Middle East and Africa, specifically Europe, because that’s the most dominant portion of the combination. But with the subsea systems and the Tier one [platform] and the strategic partnerships we’re building, the impact goes way beyond the EMEA area, into North America and deeper into Asia than we’ve been before,” Gilder says.
Largest growing market
Asia is Colt’s largest growing market. She says, “If you look at it, just from a revenue perspective, we’re still growing at a very strong rate. Specifically we have a strong presence in Japan.” Colt and KVH – the Tokyo based cloud and data centre service provider – were both founded with investments by Fidelity Investments and associated companies. Colt acquired KVH in 2014 and continues to build out fibre infrastructure there. It recently announced it would build out into west Japan, as it seems more manufacturing will take place there.
Gilder adds, “We’re continuing to look at opportunities in rest of Asia. Right now we’re concentrating on getting this right, that we get the integration, right, but we are investing organically in the region. We are further developing some strategic relationships and partnerships as well, to ensure that we have access, whether it be in Indonesia, Vietnam, Australia or elsewhere.
*Allison Kirkby served as CEO of TDC then Telia, and will lead BT from early in 2024. Margherita Della Valle is CEO of Vodafong Group, Christel Heydemann Group CEO of Orange and Aliette Mousnier-Lompré CEO of Orange Business.