Building the business case for MEC

Case study overview

STL Partners works collaboratively with clients to identify, define, and prioritise use cases and services across a range of growth areas. We help clients to define the viable business model options and build a detailed business case to quantify the opportunity. This includes in-depth cost and revenue modelling to assess returns on investment (ROI), as well as detailing and analysing the potential commercial models for the product or service.

See how we helped a global mobile operator:

  • Identify and define use cases for a MEC product;
  • Score and prioritise those use cases to identify the tactical & strategic opportunities;
  • Size the market and potential revenues for prioritised use cases, including breakdowns by value chain segment;
  • Quantify ROI for roll out of MEC sites across different business models (IaaS vs PaaS vs SaaS) and partnership strategies with hyperscalers (Build vs Borrow).


Consulting services overview

Get in touch to find out how we can help you:

  • Identify and prioritise key use cases
  • Define the viable business models
  • Model the business case for new initiatives

We worked closely with STL in true partnership to deliver high-quality, actionable insights that weren’t available anywhere else

Head of cloud edge
Global tier-1 operator

Use case identification and definition

For a leading European operator, STL Partners identified over 50 innovative use-cases for edge computing. We looked at use cases spanning both the dedicated and distributed edge, as well as use cases across different viable edge business models.

Once use cases had been identified, STL Partners further developed the use cases, through desk and primary research, highlighting potential customer segments, real life examples, the drivers for edge (on-premise edge or network edge), and the potential proposition (e.g. Gaddi pitches).

Example deliverables
Example deliverables

Use case scoring and prioritisation

Through a series of interactive workshops, STL Partners defined key criteria with the client to score the developed use cases and subsequently prioritise ~8 use-cases, which were in-keeping with the operators “tactical MEC rollout strategy” and wider portfolio.

Criteria included potential pull through revenues, the technical maturity of the solutions, “how edge” to assess the potential value of the proposition to industry customers

Sizing the market and potential revenues

Once the use cases had been prioritised, we undertook market sizing to assess each use-cases financial viability. We sized the addressable market and potential revenues for the client through a bottom up approach, looking at a granular level at use case adoption timelines, regional spend across the client’s key markets, and different pricing model options. We also sized the market by value chain segment to assess where the client should play and where most value could be derived.

Example deliverables
Example deliverables

Quantifying ROI for roll out of MEC sites

In parallel with this use-cases work, STL Partners built a commercial model to inform the telco’s strategy with regards to building and roll out of the MEC platform. We sought to answer the overarching question: “Should the telco build its own MEC infrastructure, or borrow from potential partners (including hyperscalers)?”.  

This exercise included building an analytical model to forecast costs and revenues across different business models the telco could adopt (IaaS, PaaS, solutions etc.), and to assess how this changed over time with increasing server growth and use case adoption. We also looked at different partnership models between the telco and hyperscaler, for example, charging based on data ingress/egress or on a simpler co-location model (charging for power/space).

We could then calculate payback and NPV across these models at different rates of growths and sensitivities to assess worst and best case scenarios. This fed into the client’s subsequent negotiation and partnership with the partner.