5G, unlike 4G, seems to be creating new opportunities for partnerships between mobile operators and hyperscale cloud computing giants, in large part because edge computing has to be supported.
Some suppliers of software infrastructure for telcos also are using Google Cloud as the platform for services supplied to mobile service provider customers. Netcracker Technology, for example, deploys its entire digital BSS/OSS and orchestration stack on Google Cloud.
Especially in the edge computing area, mobile operators aim to supply low-latency 5G connections while the hyperscale cloud providers supply computing. That might seem a classic case of "dumb pipe" as the revenue model, but optimists might argue that is about as good an outcome as might be expected.
Some service providers also are partnering with Google Cloud to support internal and customer-facing operations. So much has changed in five years. Back then, many top telco executives ranked Google as a bigger threat than other telcos.
A 2015 survey of 101 service providers sponsored by Openet Telecom, including respondents from every region, found “over the top” application providers were viewed as the most-significant competitors.
In fact, app providers were deemed bigger threats than other mobile operators, mobile virtual network operators, Wi-Fi first MVNOs, fixed network operators or free Wi-Fi providers. These days, a growing number of tier-one telcos are partnering in new ways with hyperscale cloud services providers. And so are key telco suppliers.
Netcracker also will leverage Anthos, Google Cloud’s open application platform that helps telecommunications customers deploy, manage, and optimize their applications, whether they are on-premise or in the cloud, to deliver its suite of products across multiple private and public clouds, on-premise environments, and at the network edge.
Realistically, many might now conclude, telcos cannot challenge the hyperscalers. So partnerships combining edge connectivity with hyperscale computing are likely the only ways partnerships between mobile operators and hyperscalers can succeed.
Google Cloud says it is helping telecommunications companies monetize 5G as a business services platform, in part by prototyping and developing edge computing use cases in retail, manufacturing and transportation.
The Global Mobile Edge Cloud program, for example, aims to create a portfolio and marketplace of 5G solutions built jointly with telecommunications companies; an open cloud platform for developing these network-centric applications; and a global distributed edge for optimally deploying these solutions, Google Cloud says.
A collaboration with AT&T is part of that effort, where AT&T supplies the network while Google Cloud supplies the computing functions.
That might strike you as yet another instance of telcos supplying connectivity (dumb pipe) while somebody else supplies the applications. Realists might say that is about as good as it gets, in many cases.
A few tier-one service providers might hope to create platforms or services and applications for vertical markets. Already, one can see that in prior efforts to diversify into applications and platforms. Between 2017 and 2018, for example, AT&T significantly added non-telecom revenues. Edge computing and internet of things appear to be the next big promising opportunities for connectivity providers.
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