Who cares about Telco Cloud?

“Who cares about Telco Cloud?”

I’ve been asked this twice in two weeks. It’s a valid question. After all, I lead our telco cloud practice – so I should be able to justify my existence!

One of my interrogators was a business leader. “Isn’t “telco cloud” just a technical term which covers up a host of boring three-letter acronyms that we would rather leave to the geeks?”

The technologist had a different perspective. “Telco cloud is marketing spin applied to expensive technologies that have delivered very little of the value they’re supposed to”.

Both views are valid, to a large extent. Telco cloud is one those things that the industry has made a lot of noise about – but with little substance behind it.

Back in the early 2010s, the idea that a telecoms operator could run its network in the cloud was earth-shattering. Telecoms networks were complicated and highly-bespoke, and therefore expensive to build, and operate. What if we could find a way to run networks on common, shared resources – like the cloud computing companies do with IT applications? This would be beneficial in a whole host of ways, mostly related to flexibility and efficiency. The industry was sold.

Over time, the term has started to also be associated with cloud business practices – that is to say, the innovation-focused business model of successful cloud computing companies. If the telco’s core asset was running in the cloud, it’d be easier to “do a Google/Amazon/etc.” – and, as if by magic, make more money:

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But most telco cloud “deployments” to date have been monolithic implementations of network functions virtualisation (NFV) that have delivered very little of the technical agility, flexibility, programmability and efficiency that is required to adopt Google-like innovative working practices. A lot more work needs to be done before the cash comes rolling in!

As a result, telco cloud has made little impact within operators’ technical teams, and no impact whatsoever across the rest of the business. It is simply uncool – a load of expensive, geeky stuff that doesn’t help much.

But the truth is: telco cloud is extremely important if we are to achieve what we’re aspiring towards.

Think back to the business leader who told me telco cloud was for geeks. I asked her what she was interested in. What exciting stuff gets telco people out of bed in the morning, if it isn’t cloud? Her eyes lit up, and she began to list new “growth services” that she’s working on, and that her new 5G network investment would enable. All of them are very “Google”:

On-premise edge computing for financial services companies. Cross-border networks for connected cars. Ultra-low latency network slices for enterprises. Drone platforms. Augmented-reality for live sporting events.

Many of these things would cause my industry analyst colleagues to cringe and roll their eyes. But they stand out on three fronts:

First: none of them are outside the realms of possibility. In fact, 5G is supposed to enable all of them.

Second: all of them require connectivity, so telecoms operators will have a role to play.

Third – and most important: they are cool.

But the business leader had forgotten one thing: all of those use-cases will need to be underpinned by highly flexible, programmable network and IT infrastructure: the fabled telco cloud. Without that infrastructure in place, none of these ideas will ever move beyond the idea stage, and the 5G investment case, which was built on opportunities like this, will collapse.

So, the answer to my tongue-in-cheek question is: everyone should care about telco cloud. Now is the time to pull together and make it happen.

If telco cloud still matters, how can we ensure it happens and quantify what success looks like? My team is working with leading operators and vendors on this issue – and also publishing strategic research. Take a look.

Matt Pooley

Matt Pooley

Matt Pooley

Senior Consultant

Matt led STL Partners’ bespoke work with leading operators and tech companies across the globe on defining the telco cloud opportunity, strategies and routes to deployment. On the side, he is a regular speaker at industry events, and has authored research on topics as broad as innovation, network experience and SD-WAN deployment models. Current focus includes cloud native, network automation, and partnership strategy.

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