- Lumen’s Alkira integration is about more than multi-cloud networking — it’s a bid to make enterprise connectivity work more like the cloud
- The plan hinges on moving Alkira’s software-defined connections onto Lumen’s private network
- Analysts say the consumption model Lumen is pitching makes sense
Lumen’s acquisition of multi-cloud networking company Alkira is now a done deal, and the company is wasting no time integrating its new software holdings.
Jim Fowler, Lumen’s chief technology and product officer, told Fierce that it will immediately begin selling Alkira’s connectivity platform to customers to provide connectivity between data centers and clouds. It’s also kicking off some intensive integration work.
Over the next 18 months, Fowler said Lumen will focus on integrating Alkira’s software control plane with its network such that the connectivity Alkira’s platform offers will ride on Lumen’s physical infrastructure.
Lumen has spent the past few years not only building out its network but working on a network-as-a-service platform to make it possible for customers to self-configure connectivity through its Lumen Connect platform. That covered premises-to-data center connectivity. The Alkira piece will expand that to cloud-to-cloud and data center-to-data center.
Historically, the Alkira connections have run over the open internet or hyperscaler cloud networks, Fowler explained. Once the integration is complete, though, the Alkira connections will run over Lumen’s private network in the U.S. with guaranteed deliver statistics and increased security.
Fowler added Lumen will also be giving customers access to new features on existing products that it couldn’t have offered before the merger. For example, he said private network connectivity for connections between cloud providers will be coming to Lumen’s Multi-Cloud Gateway.
The future network vision
According to Fowler, everything Lumen is doing is about enabling a new version of the network for the AI era. That means a network that is more flexible, more secure, lower-latency and, most importantly, more consumable.
“Customers are really not trying to manage one cloud or one carrier or one data center anymore. They’re really trying to figure out how they operate across all of them. So when you think about the world that we’ve moved into, the value is giving them a logical way to be able to connect and control all that,” Fowler said.
But consumable doesn’t just mean a network that’s easier to deploy and manage, but also one that bills customers based on actual usage. The model is the same as the one that cloud providers pioneered.
“We’re going from selling a circuit to selling connectivity,” Fowler said. “So instead of selling you 10, 100-gig circuits between 10 locations, I’m going to sell you connectivity between all of your applications, all of your servers, all of your data centers, all of your ecosystem providers, on demand, at the volumes you need, when you need it.”
Asked how this will change the way customers account for networking costs, Fowler said they’ll just end up running the same playbook they did with FinOps to manage the new cloud cost paradigm.
“We do know our customers are very comfortable with the FinOps model of managing cloud. This is just going to be the next version of that for them,” Fowler said.
Believers – and skeptics
Not everyone is sold on Lumen’s vision. After the Alkira deal was announced in May, Lumen’s stock actually dropped. Fowler argued that’s because Wall Street is missing two huge puzzle pieces.
The first is that more than half of all internet traffic is now machine-to-machine, he said. That means networks need to be able to adapt and move faster. While humans are still at the wheel as far as provisioning is concerned, Fowler imagined a future in which AI agents are actually the ones requesting to spin bandwidth up and down to complete the tasks they’ve been given.
Second, Fowler said investors may not necessarily grasp the importance of the partner ecosystem Alkira brings to the table. This, he said, will make it easier for customers to layer security, load balancing, zero trust and other tools on top of their connectivity.
“The more you can simplify it for a customer, how that runs, the more successful you’ll be,” he said. “I don’t think the Street understands that yet.”
Indeed, asked about the importance of this kind of capability, Dell’Oro Group Senior Director Mauricio Sanchez told Fierce “Customers increasingly want the network fabric to support policy enforcement, service insertion, segmentation and visibility across distributed environments. The ‘click of a button’ language should be taken directionally, but the broader point is right: security, SD-WAN and cloud networking are becoming more interdependent.”
One thing investors and analysts are starting to get, though, is the consumption model.
Futuriom’s Scott Raynovich told Fierce that the Alkira deal is first and foremost about “ease of use” and providing customers with on-demand infrastructure, a feature he said will become more important as AI scales.
“More service providers should be thinking about providing modern cloud and network infrastructure on demand, as selling circuits is an antiquated model, especially when combined with slow provisioning,” he said.
Sanchez agreed, noting that “AI does not make every legacy network obsolete, but it raises the penalty for networks that are slow to provision, difficult to observe and hard to change.” He added that while the deal doesn’t automatically put Lumen ahead of the competition – since execution still matters – it certainly “moves the company beyond a traditional connectivity-provider posture.”