Cloudification of Telecom Technologies and Equipment
Price: Starting at USD 3,000
Publish Date: 15 Mar 2022
Code: AN-5279
Research Type: Research Report
Pages: 30
In telecom, cloudification refers to the process of transitioning to new business models in which cloud-based software is the name of the game. Virtual networks replace physical ones in the cloudification process, providing greater flexibility and scalability for telcos and customers alike. In the age of 5G and cloud dominance in the telecom industry, operators must focus more on being enterprise, government, and industry services-led than past generations. To be more specific, it’s expected that CSPs will branch off from standardized products and deliver application and industry-specific services.
Going forward, CSPs will have to allocate the time and resources to profoundly understand how revenue and profitability are generated in enterprise verticals. Only then can product planning and design be handled in a way that aligns with desired business outcomes.
Cloudification requires CSPs to either build their own private cloud platform or leverage existing public cloud services such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud, to name a few. And there’s also the option to use a hybrid approach. In some cases, network providers will start out using the public cloud while developing their own cloud infrastructure, and before eventually migrating to the in-house solution. Interoperability is a crucial point to stress when it comes to cloud platforms, as multi-vendor solutions are a preferred option.
Some of the key ingredients to a telco cloud are Network Functions Virtualization (NFV), Software Defined Network (SDN), automation, and Artificial Intelligence (AI). One of the key benefits of this new software-centric ecosystem is that hardware is phased out in favor of virtual machines. As a result, service providers no longer need to purchase expensive hardware or take the time to install new devices. Plus, a virtualized network enables operators to make modifications or add new services on-demand because additional hardware is not required.
As telcos work on cloudifying, they will seek out Network Equipment Vendors (NEVs) that take full ownership of the technology, from building applications and defining architectures to managing some of their workloads. Now, with the cloudification of telecom equipment, NEVs need to look at the commercial model in terms of dematerialization. In other words, NEVs should view their inventory less in terms of a limited supply of tangible products to a software approach in which supply is no concern and recurring revenue becomes a mainstay.
Finally, as CSPs have a steep learning curve in cloudifying their operations, there’s also an excellent opportunity for vendors and System Integrators (Sis) to provide consulting services. For example, Nokia Cloud Transformation Consulting guides CSPs through the process of migrating to the cloud by laying out a cloud technology strategy, helping mitigate risks, choosing the best cloud option (public, private, hybrid), deciding to use either an engineered approach or best-of-breed approach, ensuring security compliance, and more.
