Fresh off one of the strongest quarters in the company’s 25 year history where it hit double-digit, year-over-year revenue growth and a fourth consecutive quarter of growth, Extreme Networks is betting heavily on automation, AI and cloud management to keep the party going.
Timing is everything, and the company has hit the cloud networking trend at a great time as that is what enterprise customers are looking for to reduce the complexity of networking and managing their environments, said CEO Ed Meyercord.
“Businesses are rethinking their network architecture after adding more remote users and devices in response to the COVID-related changes from last year, and the cloud is the ideal way to deal with those changes,” Meyercord said.
In Extreme’s case, it expects its flagship Extreme CloudIQ (XIQ) management platform, which saw a 122 per cent subscription-rate growth in the past year, to help it continue to grow enterprise-class customer networks.
“As the second-largest cloud-based networking vendor, we currently manage 1.6 million devices on XIQ,” Meyercord said. Going forward, the company will continue to enhance XIQ and other components with AI, ML, automation, he said.
Automation is key because of the efficiency it brings to managing IT infrastructure, Meyercord said. The idea is to automate responses to as many of the multiple alerts and alarms IT has to deal with and tons of hours it takes to deal with them manually.
Automation and hyper-automation are gaining some serious use, according to Gartner. The research and consulting firm says the hyper-automation market will reach $596.6 billion in 2022, up from $481.6 billion in 2020 and a projected $532.4 billion earlier this year.
“Hyper-automation is an approach that enables organisations to rapidly identify, vet and automate as many processes as possible using technology, such as robotic process automation (RPA), low-code application platforms (LCAP), AI and virtual assistants," Gartner stated.
“The fastest-growing category of hyper-automation-enabling software includes tools that provide visibility to map business activities, automate and manage content ingestion, orchestrate work across multiple systems, and provide complex rule engines. Technologies to automate content ingestion, such as signature verification tools, optical character recognition, document ingestion, conversational AI, and natural language technology will be in high demand.”
In addition to automation, AI and ML help IT get more predictive and solve a lot of network problems before they cause real issues, Meyercord said.
Extreme is working on new XIQ tools that use AI technology that the company calls Explainable AI, which Meyercord says will tell IT what the alarm is and why it was generated. The concern is to overcome shortcomings of the initial round of AI tools that came into the market that triggered lots of false-positive alerts and alarms, he said.
“Our alerts will be both explainable and 99.9 per cent false-alarm free. It has been in select customer environments for a year and will soon be launched under our copilot license for XIQ along with enhancements for AI and ML insights for our entire portfolio. This technology will go into public beta in June and will be available to every Extreme user,” Meyercord said in the company’s Q3 earning call.
“The idea is that we want to help IT get in front of issues on the network. Whether it’s an access point about to fail or a loose cable connection or RF interference, we can see and do something about those things,” Meyercord said.
Another hot topic this quarter for Extreme and every other high-tech company is the growing shortage of intelligent chips that’s causing production delays and possible cost and supply-chain problems.
“We have seen an increase in product constraints as a result of the chip shortage, and it is having an impact. But in our case we baked expectations of the shortage into our financial forecast, and our team has managed the impact,” Meyercord said.
During the company’s earning call Meyercord said, "I think the level of product constraints that may be prevalent out there in the industry are probably a little less for us...given the relationship [with semiconductor partner Broadcom] that we have on that key component.”
Broadcom and Extreme teams are working aggressively to manage around the constraints they are facing, Meyercord said.
In the background of all these technological changes and challenges, enterprises face having to train new IT workers and in some cases retrain current ones. The company is seeing many of its customers use Extreme Academy to evolve their workforces, Meyercord said.
Akin to programs Amazon and Microsoft offer, Extreme Academy Live, a series of free, online training courses for cloud and networking skills. The first course that started in December had 8,000 students enrolled, drew more than 25,000 views, and streamed for 15,000 hours over three months, the company said.