Telcos: Stop Thinking You're Always the Leading Actor

Hubris: "an extreme and unreasonable feeling of pride and confidence in yourself"

I've followed developments in the telecoms industry for over 25 years. I've seen positives (eg broadband, SMS, LTE) and negatives (UMA, RCS) as well as a shifting landscape of regulation, the rise of the Internet, and multiple generations of network technology and services infrastructure.

Undoubtedly, both fixed and mobile networks have added massively to economies, society and our current way of life. It's understandable that network operators - and their vendors and governments - feel proud of their legacy and want to perpetuate it.

Yet it's possible to take this too far. Even beyond obviously-silly pronouncements such as "5G is as important as electricity", there remains a constant thread among the telecoms industry that it is absolutely central to all future developments, and that the network's finely-engineered QoS mechanisms are the wellspring of technology-derived value, as well as pivotal to future GDP and world happiness.

But while self-belief and aspiration is helpful, arrogance and self-delusion is not.

 

Starring role, or supporting cast?

There is an assumption that the (public, traditional) network is always the leading actor in any movie about Industry 4.0, IoT, smart homes, AI, pandemic recovery & the "new normal", combating climate change, or creating new modes of communications and entertainment like AR/VR.

And yet in reality, the telecom network - especially public 5G - is often going to be a supporting actor. Or perhaps just have a walk-on role, or be relegated to an extra who gets dubbed in a different language.

You can almost imagine a C-list celebrity arriving at a busy party and shouting: "Guys, guys! Listen up! You can get rid of all your old stuff, all your Internet apps, all your legacy Industry 3.0 gear... just use our new [Technology X] instead, and we'll offer it all with a nice monthly per-GB subscription. You can even buy a slice!"

Heads swivel. Eyes roll. People refill their glasses & continue their conversations.

A bit more realism and humility is required. Telecoms isn't always the star of the show, and neither does it write the screenplay for the rest of the infrastructure or solution.

That doesn't mean it lacks value, or has a limited opportunity - but that it has to play nicely alongside others... and accept that the director and producer have other priorities to focus on - and a wide choice of alternatives to cast in the same roles.

Leaving the acting analogy aside, it's also important to understand that the nature of the word "telco" is itself changing. Looking out to 2030, the "telco of the future" isn't like todays - there won't just be 3-4 national MNOs and a handful of converged/fibre/fixed-line operators. There will be a vast diversity of service provider types and private/community networks. I've written before about the "new telcos" and this is a critical aspect for traditional ("legacy"?) operators to understand and even embrace.

This isn't just 5G-related

It's tempting to just see this as a problem with how 5G is being positioned and hyped. But while I discuss that below, it's far from being unique. This attitude has been around for years, and pervades the entire industry. Some examples of this mindset include:

• Telcos consistently assume that "voice" means the same as "telephony", since they only do the latter. Telephony is just one voice application of hundreds - and a 140yr-old clunky and poorly-optimised one at that. This is why telcos don't have a foothold in voice assistants, critical comms, gaming voice, podcasts and so on - and get out-competed by cloud players for UCaaS and cPaaS. (For more: see my upcoming workshop series on the future of Realtime Comms, Voice & Video, starting May 19th)
• 20 years ago, 3G networks were pitched as platforms for telco-created and telco-delivered videoconferencing, games, "value-added services" (ringtones, basically) and much more inside "walled gardens". The killer app was, in fact, plain vanilla Internet access - despite early dataplans trying to restrict the use of VoIP and IM.
• Some 1980s & '90s telcos saw themselves as central to enterprises' telephony systems and pitched "Centrex" services - basically a precursor to today's cloud-based UCaaS. Most businesses decided that running their own PBXs was a better option - it fit with their internal organisation and operations much better.
• Telcos' MEC edge-compute was supposed to take centre-stage against hyperscale cloud providers. Instead, MEC's main use is to host internal NFV or vRAN functions that run the network itself. Or enable some hyperscalers' own edge platforms on a wholesale basis, where they don't have other options. Meanwhile, edge-compute evolves in many other (non-telco) domains much faster, including on-device / gateway, or linked to non-3GPP technologies such as Wi-Fi and fibre.
• RCS was initially supposed to replace all Internet-based messaging apps. Then its believers pivoted to pitch it as a universal B2C tool for mobile customer interactions. In reality, it's (at best) just another slow-moving messaging app with few users and no loyalty, or special features. It turns out to be channel #17 for consumers dealing with companies that don't merit downloading a proper app or which have a lousy website. RBM's best hope is for things like tickets from that 3rd-tier airline you're forced to use to get to an obscure airport, or ordering a new recycling bin from the local council's chatbot. It's competing with the browser, not apps or Internet messaging.
• MNOs' public 5G with network-slicing was supposed to replace all the cumbersome enterprise network gear such as ethernet and Wi-Fi. There are still visions within obscure 3GPP work-groups about "5G LANs" and I still read and hear nonsense from the cellular industry about it replacing Wi-Fi at scale....
• ... or alternatively, the new story is that the 5G core is going to be the centrepiece of all telecoms and networking - it'll control Wi-Fi, fixed broadband, satellite connectivity etc. on operators' terms and policies, of course. (See the Broadband Forum's rather Machiavellian efforts here - led unsurprisingly by behemoths like Verizon & Deutsche Telekom that want the core network as a "control point" all the way to end-devices in the home). Yes, maybe Wi-Fi can easily just slot into 5G's shiny new cloud-native core - but in reality, 99% of Wi-Fi has nothing to do with cellular networks, offload, or non-trusted / non-3GPP access
• As I mentioned recently, the telecom industry tries to take 100% of the (carbon) credit for new technologies reducing energy consumption or emissions.

The ridiculous and judgmental term "OTT" exemplifies this - creating a them-and-us fallacy of "web" companies using "our" pipes. Never mind the fact those technology companies build their own infrastructure, and invest billions in R&D for everything from AI to chip design. Or that all telcos themselves deploy "OTT" apps, websites and Internet-delivered functions.

To use a more sociological phrasing, many network operators still have a "sense of entitlement". They feel that they should be running everything from voice and video communications to networked entertainment, smart homes, or B2B commerce and industrial automation.

This attitude extends into public policy, and discussions on topics like spectrum, where there is a sense of exerting "license privilege". There is often an attempt to exert control before earning it. This is different to (say) Apple's control of its AppStore.

(*Sidenote [And apologies to my clients if this stings!]:if you work in telecoms & talk casually about "OTTs" for anything other than TV streaming, you should be fired, and so should your boss. It's not only wrong, it's flat-out ignorant and damaging. It indicates gross incompetence. It's not quite a "hate crime" but it is a them-and-us divisive term for a distinction that simply does not exist).

Actions have consequences

There are several reasons why this problem is more than just "attitude" or normal marketing-related hyperbole. It directly translates to business successes and failures.

• Many telco technologies don't just benefit from n-squared network effects, but depend on them. They degrade "non-gracefully" if they're not ubiquitous - which means they need to be adopted by other telcos at the same time. Messaging is a good example - at 50% uptake, across 50% of operators that implement a new standard, there's a high % chance that two people on different networks won't be able to communicate, especially internationally. There's no focus on saturating small niches, or communities of interest, then expanding over time.
• Telcos spend so much time envisioning themselves as "platforms" that they fail to realise that pretty much every tech platform evolves from a great (and widely-used/loved) product. Google indexed the web & created a great seach function, before it started selling ads. Apple sold the iPhone for a while before launching the AppStore. It also had a loyal base of iPod users who wanted a music-phone, too. Amazon sold books before it launched AWS. All of them had platforms in mind earlier... but had to create a product before tuning the way the platform needed to behave for customers / developers.
• The telecom industry always assumes that it will be a "net exporter" (or even pure exporter) of capabilities and APIs. It expects it will sell more "exposed functions" than it buys. It assumes a role at the top of the value chain, rather than the middle. This is starting to change now with the recognition of the role of buying public cloud services for virtualisation, but prior to that it just relied on Google Maps for "find the closest store", or credit-checking agencies for new subscriptions. Almost all successful tech businesses these days are more like trading hubs, importing AND exporting functions, APIs and data. The assumption that telcos will always be the OrchestratORS rather than OrchestratED is leading to an unrealistic world-view and poor decisions.
• Conversations with regulators and governments try to amplify the supposed "special" status and reinforce the spurious divide with new telcos or Internet/tech firms. "We don't want to be dumb pipes, so please tax & regulate the clever people, because we can't compete". This might seem smart - and perhaps gets better access to new funds for rural coverage or pandemic recovery - but it also hampers and limits future options, for instance around international mergers and expansion. Domestic champions find it hard to live dual lives as global heroes.

What needs to change?

There needs to be a frank, honest discussion about "Telcos' place in the world", which works out how to transition from a world of a few licensed network operators per country, to one in which the landscape is much more complex and nuanced.

• Position the term "telco" as a broader church & consider the needs/roles of the wider group. MNOs and fixed telcos are important, but not alone here. TowerCo's are telcos. Neutral Hosts are telcos. WISPs are telcos. MVNOs are telcos. Governments can act as telcos. Community networks are telcos. Consider them peers. Insist that GSMA, CTIA, ETNO and others treat all telcos equally and offer membership (and governance) on reasonable terms.
• Don't push back against governments trying to enable new forms of competition and new entrants. Instead, exploit them. Offer reference designs for Open RAN internationally (see Rakuten). Launch Private 5G services in new countries with local spectrum (Verizon is doing this). Run MVNOs in other countries (Turkcell, China Mobile etc).
• Internet, IT and industrial automation (OT) companies need to be seen as equal and equivalent peers too. Amazon, Microsoft, Google, Siemens, Honeywell, IBM, HPE, Tech Mahindra, NTT Data & many others will often own the customer relationship. Sometimes telecoms fits into their frameworks, and sometimes theirs' fits into telcos. Maybe there are roles for gatekeepers, but only where there is enough competition.
• Telecom standards need to become much more "loosely coupled". The traditional insistence that a 5G radio needs a 5G core and IMS/VONR telephony needs to stop. 3GPP standards and interfaces should be mix-and-match. Rather than trying to push complex core networks into fixed broadband architectures, the industry should instead make core-optional lightweight variants of 5G RANs, or expose interfaces that make them controllable by enterprise IT, or a Wi-Fi platform.
• Offer both complete solutions and sub-component services. Don't assume primacy - sell what customers want. Maybe enterprises want their own Private 5G, but would happily use telcos to do the installation and maintenance, or to enable roaming or as a provider of eSIM-aaS
• Use 3rd-party infrastructure and connectivity where it makes sense - for instance on neutral host networks. Attempt to automate onboarding, and remove friction wherever possible. Accept national roaming if it means your customers get better access in remote places, or indoors.
• Work out better metrics to measure the business & communicate these to investors and regulators. See this article on what metrics are especially poor.
• Understand software and app developers' mindsets. They don't want to pay for "premium QoS" on a thousand networks. They want warning of congestion, and how to adjust their apps' demands - when/how to use on-device compute vs. cloud, which codecs and compression, and so on.
• Stop thinking that phone calls (and worse, video calls) are perfect manifestations of communications, with just an upgrade every 10 years from circuit to VoLTE to VoNR. Why doesn't the dialler app get updated once a month with new features, or give the user more controls?
• Look at alternatives to subscription business models. Why not an insurance-style annual premium? Or "dark spectrum" just like "dark fibre"? Or 100 others?
• Invent more stuff. Spend money on R&D rather than sports TV rights. Much of the current angst comes from competing against tech firms that actually create products and services that people want to buy/use.
• Have a much clearer policy and stance on buying/selling technology and services. Make using platforms effectively seem as important as creating platforms. This is starting to happen with cloud and Open RAN, but it's very slow.

It has been interesting to see that the most interesting - and lauded - new telcos have come from different backgrounds, and have different attitudes. Rakuten is a cloud/eCommerce company first and foremost. Dish started as a satellite TV provider. Jio's parent Reliance Industries is a broad conglomerate. Although not a new company, South Korea's SKT is part of the SK Group, which also has a broad set of non-telco assets.

To be fair, one area where telcos are taking a more hybrid position is around physical assets. Some are operators/co-owners of shared networks, some spin-out tower businesses, some sell dark fibre and some buy - or both in different places. Some use public colocation and data-centres, while others are looking at local offices as possible edge compute sites.

Conclusions

This undoubtedly comes across as a bit of a rant (and not for the first time...) but it's coming from a position of frustration. I've seen the same issues play out for years - and at the core is this attitude of entitlement that I mention above.

It's totally counterproductive, even if the inertia - and sense of history - is understandable.

Everyone wants to be the star, especially if they've been the lead actor for decades. But sometimes, the role just involves a couple of scenes. And often, it's just the cameo roles - if played well - that get the headlines after all.

[A quick plug again: my upcoming Future of Video & RTC workshop series is here]

Cross-Posted from my LinkedIn Newsletter Article (here). Please see comments there & Subscriber.

#telecom #5G #telco #cloud #technology #regulation #voice #edgecomputing

5G will catalyse the transformation of the telecom industry itself

This is a post that originally appeared on my LinkedIn page (see here). There are numerous additional insights in the comments.

Much of the current hype about #5G relates to business and verticals. Many claim that 5G will be a central force in "transforming" industries. 

But what people in the telecoms sector don't yet seem to realise is that the very first industry that will be transformed by 5G is.... telecoms itself. 

5G is bringing a new set of challenges and complexities - new spectrum, more need for coverage indoors & in remote areas, and new use-cases and stakeholders. 

If 5G is anywhere near as important as it's claimed, then many businesses and governments will want to own it, customise it and control it directly, not through an MNO.

Meanwhile, localised and shared spectrum, arriving at the same time as 5G (but also usable for 4G) is creating a new landscape of wholesale/neutral host players, private and community operators, cloud/Internet players with mobile assets, industrial/vertical MNOs and hybrid MNO/MVNO providers. 

The old world of mobile involved 3 or 4 national MNOs, plus some TowerCos and a few consumer MVNOs. 

The new, 5G world is much more fragmented and heterogeneous. Even as regulators look at allowing mergers of the legacy MNOs, there's a Cambrian explosion of newer, cooler, more-agile niche players emerging. 

If you're interested in this topic & want to engage more deeply, I'm running a London workshop on Neutral Host Networks on Nov 21st https://disruptivewireless.blogspot.com/p/2nd-neutral-host-networks-london-public.html 

Also, I undertake private advisory work for clients on various angles relating to future telecoms & cellular provider heterogeneity and opportunities - please get in touch to discuss your needs.
 
 #telecom #neutralhost #4G #spectrum #privateLTE #CBRS #private5G

Timing is everything: Why telecom industry visions get it wrong

Introduction

One of the things I find most frustrating about technology forecasts and visions – especially in telecoms and mobile – is the lack of awareness of adjacent issues and trends, or consideration of "gotchas" and alternative scenarios.

So for example, when telcos, vendors or policymakers predict what 5G deployment, or network-slicing, or edge-computing or anything else might result in – applications, uptake, revenue opportunities and so on – they often fail to ask two critical questions:

• Distractions: What are the prerequisites for this to happen? What are the bits of the overall wider system that are forgotten but necessary, to make the headline technology feasible and useful? And when will they be achieved? What's the weakest link in the chain? Is delay inevitable?

• Disruptions: What else is likely to happen in the meantime, which could undermine the assumptions about demand, supply or value-chain structure? What's going on in adjacent or related sectors? What disruptions can be predicted?

This post has an accompanying podcast, on my SoundCloud:

Internal distractions & pre-requisites

So for example, for 5G to be successful to the degree that many predict (“trillions of $ of extra GDP”, millions of extra jobs etc) there first needs to be:

• Almost ubiquitous 5G coverage, especially indoors, in sparse rural areas, and in other challenging locations
• Enough fibre or other backhaul connectivity for the cell-sites
• Suitable software and hardware platforms to run the virtualised core and other elements
• Enough physical sites to put antennas, at low-enough costs & with easy-enough planning
• Many more engineers trained and qualified to do all of the above
• A decent business case, for instance in remote areas
• 3GPP release 16 & 17 to be completed, commercialised and deployed, especially for the ultra-low latency & high-reliability applications.
• Optimisation and operational systems, perhaps based on as-yet-unproven AI

Yet vendors and policymakers often gloss over these "annoying" practicalities. There seems to be an attitude of “oh, they’ll have to make it work somehow”. Well, yes, perhaps they will. But when? And at what cost? What changes does that imply? How will the gaps and limitations be bridged? And what happens if firms go bust while waiting for it all to happen? What other ways to solve problems can users pursue sooner, that don't involve 5G?

A key implication of this is that timing and profitability of massmarket adoption is often much later than expected. While Amara's Law might eventually apply (we tend to overestimate the effect of a technology in the short run and underestimate the effect in the long term), that doesn't mean that early initial adopters and investors make the returns they'd hoped for.

External disruptions and substitutes

Perhaps even more pernicious is the lack of situational awareness about parallel developments elsewhere in the broader tech ecosystem. These undermine both demand (as alternative solutions become viable in place of the hoped-for technology) and supply / operation (by throwing up new complexities and gotchas to deal with). 

These are often not just “what ifs" but “highly likelies” or "dead-on certainties".

So for instance, the visions of network slicing, or edge-computing for 5G (which will really only crystallise into large-scale commercial reality in maybe 4-5 years) will have to contend with a future world where:

• 5G networks are still patchy. There will still be lots of 4G, 3G and “no G” locations. What happens at the boundaries, and how can you sell QoS only in certain places?
• There will be a patchwork of “uncontrolled” locations – they might be 5G, but they could be owned by roaming partners, indoor network providers, private localised cellular operators and so on. How will a slice work on a neutral-host's network?
• An ever-greater number of devices spend an ever-greater amount of time on Wi-Fi – usually connected to someone else’s fixed-line infrastructure and acting as either uncontrolled, or a direct arbitrage path. 
• Telcos have to cap their energy use and associated CO2 emissions, or source/generate clean power of their own.
• Wi-Fi 6 will emerge rapidly & is hugely improved for many use-cases, but most 5G predictions only compare against legacy versions
• Hardware based on "commodity hardware" runs against the current tide of semiconductor fragmentation and specialisation (see recent post, here)
• Devices will often have VPN connections, or use encryption and obfuscation techniques, which means the network won't be able to infer applications or control traffiic.
• Users and devices will use multiple connections together, either for arbitrage, aggregation, or more-sophisticated SD-WAN type models.
• Pricing, billing, customer support and security will be challenging on "federated" 5G or edge-compute networks. Who do you call when your network-slice doesn't deliver as expected - and how can they diagnose and fix the problem?
• Liability and accountability will become huge issues, especially if 5G or slicing is used for business-critical or life-critical functions. Are your lawyers and insurers prepared? 
• AI will be used for instant price-comparison, quality monitoring & fault reporting, collective purchasing and even contractual negotiations. "Hey, Siri, mimic my voice and get me the best discount possible with the customer-retention agents"

These are just some basic examples. Once you get into individual verticals, particular geographies or even specific companies, a whole host of other issues start to crop up  - sector regulation, value-chain shifts, government involvement, expectations of 20-30 year tech cycles and so on. Sure, in theory 5G might fit into various industries' own transformation journeys - but they won't design around it.


Conclusions

I find this all very frustrating. So many company boards, strategy departments or lower-level product/service management teams seem to operate on the basis of "all other things being equal..." when the one certainty is that they won't be. 

So the two sets of factors tend to be multiplicative:

• Distractions are internal to a new concept, and lead to delays in technology launch, market maturity and revenue.
• Disruptions are external and often inevitable, but any extra delay increases their range and impact yet further.

It's never possible to predict everything that might get delayed, or every possible disruption from adjacency. But it seems to me that many companies in telecoms don't even bother to try. 

Companies accept the "hype cycle" as inevitable, even if it might be possible to flatten it out.

By coincidence, while writing this post I started reading "Range" by David Epstein (link) which talks about the importance of "analogising widely", and the risks of narrow expertise and superficial analysis, rather than looking for implications of cross-sector / cross-discipline similarities and lessons. 

When evaluating new technologies and service concepts, CEOs and CFOs need to rely less on familiar industry echo-chambers and consensus hype, and instead seek out critics who can find hidden assumptions, both internal and external to their plans. This isn't just a negative exercise either - often, a "ranging" exercise throws up unexpected positives and opportunities from adjacency as well risks.



This post has an accompanying audio podcast - click here & please subscribe!

 
Footnote
 
I sometimes get asked to "stress test" ideas and plans, and help companies avoid expensive mistakes, get started on future glitches today, or prepare for and avoid contingencies and unintended consequences. 

Often, that exercise will throw up new opportunities as well. Usually, a collaborative (but candid) group workshop ensures this isn't a blame-game, but a path to smoother growth and innovation. The skills and mindsets can be learned and replicated, too.

If that type of approach sounds interesting, please get in touch with me, either by email (information AT disruptive-analysis DOT com) or via LinkedIn (link).

3 Emerging Models for Edge-Computing: Single-Network, Interconnected & Federated

Summary

Edge-computing enables applications to access cloud resources with lower latencies, more local control, less load on transport networks and other benefits.

There are 3 main models emerging for organising edge-computing services and infrastructure:

• Single-Network Telco Edge, where a fixed or mobile operator puts compute resources at its own cell-sites, aggregation points, or fixed-network central offices.
• Local / Interconnected Datacentre Edge, where an existing or new DC provider puts smaller facilities in tier-2/3 cities or other locations, connected to multiple networks.
• Federated / Open Edge, where a software player aggregates numerous edge facilities and provides a single mechanism for developers to access them.

These are not 100% mutually-exclusive - various hybrids are possible, as well as "private edge" facilities directly owned by enterprises or large cloud providers. They will also interact or integrate with hyperscale-cloud in variety of ways. 

But there is a major issue. All of these will be impacted by even faster-evolving changes in the ways that users access networks and applications, such as "fallback" from 5G to 4G, or switching to WiFi. In other words, the most relevant "edge" will often move or blur. Superficially "good" edge-compute ideas will be forced to play catch-up to deal with the extra network complexity. 
 
(Also - this model excludes the "device edge" - the huge chunk of compute resource held in users' phones, PCs, cars, IoT gateways and other local devices).

Note: this is a long post. Get a coffee. 

There is also an accompanying podcast / audio-track I've recorded on SoundCloud that explains this post if you'd rather listen than read (link)

Background and Overview 

A major area of focus for me in 2019 is edge-computing. It’s a topic I’ve covered in various ways in the last two year or so, especially contrasting the telecom industry’s definitions/views of “in-network” edge, with those of enterprise IT and IoT providers. The latter tend to be more focused on “edge datacentres” in “edge markets” [2^nd-tier cities] or more-localised still, such as on-premise cloud-connected gateways. 

I wrote a detailed post in 2018 (link) about computing power consumption and supply, which looked at the future constraints on edge, and whether it could ever really compete with / substitute for hyperscale cloud (spoiler: it can't at an overall level, as it will only have a small % of the total power).

I’m speaking at or moderating various edge-related events this year, including four global conferences run by data-centre information and event firm BroadGroup (link). The first one, Edge Congress in Amsterdam, was on 31^st January, and followed PTC’19 (link) the week before, which also had a lot of edge-related sessions.

(I’m also collaborating with long-time WebRTC buddy Tsahi Levent-Levi [link] to write a ground-breaking paper on the intersection of edge-computing with realtime communications. Contact me for details of participating / sponsoring)


Different drivers, different perspectives

A huge diversity of companies are looking at the edge, including both established large companies and a variety of startups:

• Mobile operators want to exploit the low latencies & distributed sites of 5G networks, as well as decentralising some of their own (and newlyt-virtualised) internal network / operational software
• Fixed and cable operators want to turn central offices and head-ends into local datacentres - and also house their own virtualised systems too. Many are hybrid fixed/mobile SPs.
• Long-haul terrestrial and sub-sea fibre providers see opportunities to add new edge data-centre services and locations, e.g. for islands or new national markets. A handful of satellite players are looking at this too.
• Large data-centre companies are looking to new regional / local markets to differentiate their hosting facilities, reduce long-distance latencies, exploit new subsea fibres and provide space and interconnect to various cloud providers (and telcos).
  At PTC’19 I heard places like Madrid, Fiji, Johannesburg and Minneapolis described as “edge markets”.
• Hyperscale cloud players are also latency-aware, as well as recognising that some clients have security or regulatory need for local data-storage. They may use third-party local DCs, build their own (Amazon & Whole Food sites?) or even deploy on-premise at enterprises (Amazon Outposts)
• Property-type players (eg towerco's) see edge-compute as a way to extend their businesses beyond siting radios or network gear.
• Startups want to offer micro-DCs to many of the above as pre-built physical units, such as Vapor.io, EdgeMicro and EdgeInfra.
• Other startups want to offer developers convenient (software-based) ways to exploit diverse edge resources without individual negotiations. This includes both federations, or software tools for application deployment and management. MobiledgeX and Ori are examples here.
• Enterprises want a mix of localised low-latency cloud options, either shared or owned/controlled by themselves (and perhaps on-site, essentially Server Room 2.0). They need to connect them to hyperscale cloud(s) and internal resources, especially for new IoT, AI, video and mobility use-cases.
• Network vendors are interested either in pitching edge-oriented network capabilities (eg segment-routing), or directly integrating extra compute resource into network switches/routers.
• Others: additional parties interested in edge compute include PaaS providers, security companies, SD-WAN providers, CDN players, neutral-host firms etc

Each of these brings a different definition of edge - but also has a different set of views about networks and access, as well as business models.


Application diversity

Set against this wide array of participants, is an even more-diverse range of potential applications being considered. They differ in numerous ways too - exact latency needs (<1ms to 100ms+), mobility requirements (eg handoff between edge sites for moving vehicles), type of compute functions used (CPUs, GPUs, storage etc), users with one or multiple access methods, security (physical or logical) and so on.

However, in my view there are two key distinctions to make. These are between:

• Single-network vs. Multiple-network access: Can the developer accurately predict or control the connection between user and edge? Or are multiple different connection paths more probable? And are certain networks (eg a tier-1 telco's) large enough to warrant individual edge implementations anyway?
• Single-cloud vs. Multi-cloud: Can all or most of the application's data and workloads be hosted on a single cloud/edge provider's platform? Or are they inherently dispersed among multiple providers (eg content on one, adverts from another, analytics on a third, legacy integration with a fourth / inhouse system)

For telcos in particular, there is an important subset of edge applications which definitely are single-network and internal, rather than client-facing: running their own VNFs (virtual network functions, security functions, distributed billing/charging, and managing cloud/virtualised radio networks (CRAN/vRAN). They also typically have existing relationships with content delivery networks (CDNs), both in-house and third-party.

This "anchor tenant" of on-network, single-telco functions is what is driving bodies like ETSI to link MEC to particular access networks and (largely) individual telcos. Some operators are looking at deploying MEC deep into the network, at individual cell towers or hub sites. Others are looking at less-distributed aggregation tiers, or regional centres.

The question is whether this single-network vision fits well with the broader base of edge-oriented applications, especially for IoT and enterprise.

How common will single-network access be?

The telco edge evolution (whether at region/city-level or down towards cells and broadband-access fibre nodes) is not happening in isolation. A key issue is that wide availability of such edge-cloud service - especially linked to ultra-low-latency 5G networks - will come after the access part of the network gets much more complex.

From a developer perspective, it will often be hard to be certain about a given user’s connectivity path, and therefore which or whose edge facilities to use, and what minimum latency can be relied upon:

• 5G coverage will be very patchy for several years, and for reliable indoor usage perhaps 10 years or more. Users will regularly fall back to 4G or below, particularly when mobile.
• Users on smartphones will continue to use 3^rd-party WiFi in many locations. PC and tablet users, and many domestic IoT devices, will use Wi-Fi almost exclusively. Most fixed-wireless 5G antennas will be outdoor-mounted, connecting to Wi-Fi for in-building coverage.
• Users and devices may use VPN security software with unknown egress points (possibly in another country entirely)
• Not all 5G spectrum bands or operator deployments will offer ultra-low latency and may have different approaches to RAN virtualisation. 
• Increasing numbers of devices will support multi-path connections (eg iOS TCP Multipath), or have multiple radios (eg cars).
• Security functions in the network path (eg firewalls) may add latency
• Growing numbers of roaming, neutral-host and MVNO scenarios involving third-party SPs are emerging. These will add latency, extra network paths and other complexities.
• eSIM growth may enable more rapid network-switching, or multi-MNO MVNOs like Google Fi.
• Converged operators will want to share compute facilities between their mobile and fixed networks.

This means that only very tightly-specified “single-network” edge applications make sense, unless there is a good mechanism for peering and interconnect, for instance with some form of “local breakout”.

So for instance, if Telco X operates a smart-city contract connecting municipal vehicles and street lighting, it could offer edge-compute functions, confident that the access paths are well-defined. Similarly it could offer deep in-network CDN functions for its own quad-play streaming, gaming or commerce services. 

But by contrast, an AR game that developers hope will be played by people globally, on phones & PCs, could connect via every telco, ISP & 3^rd-party WiFi connection. It will need to be capable of dealing with multiple, shifting, access networks. An enterprise whose employees use VPN software on their PCs, or whose vehicles have multi-network SIMs for roaming, may have similar concerns.

 

The connected edge

I had a bit of an epiphany while listening to an Equinix presentation at PTC recently. The speaker talked about the “Interconnected Edge”, which I realised is very distinct from this vision of a single-telco edge.

Most of the datacentre industry tries to create facilities with multiple telco connections - ideally sitting on as many fibres as possible. This allows many ingress paths from devices/users, and egress paths to XaaS players or other datacentres. (This is not always possible for the most "remote" edges such as Pacific islands, where a single fibre and satellite backup might be the only things available).

And even for simple applications / websites, there may be multiple components coming from different servers (ads, storage, streaming, analytics, security etc) so the immediate edge needs to connect to *those* services with the easiest path. Often it’s server-to-server latency that’s more important than server-to-device, so things like peering and “carrier density” (ie lots of fibres into the building) make a big difference.

In other words, there are a number of trade-offs here. Typically the level of interconnectedness means more distance/latency from each individual access point (as it's further back in the network and may mean data transits a mobile core first), but that is set against flexibility elsewhere in the system. 

A server sitting underneath a cell-tower, or even in a Wi-Fi access point, will have ultra-low latency. But it will also have low interconnectedness. A security camera might have very fast local image-recognition AI to spot an intruder via edge-compute. But if it needs to match their face against a police database, or cross-check with another camera on a different network, that will take significantly longer.

But edge datacentres also face problems - they will typically only be in certain places. This might be fine for individual smart-city applications, or localised "multi-cloud" access, but it still isn't great for multinational companies or the game/content app-developers present in 100 countries.


Is edge-aggregation the answer?

The answer seems to be some form of software edge-federation or edge-broking layer, which can tie together a whole set of different edge resources, and hopefully have intelligence to deal with some of the network-access complexity as well.

I've been coming across various companies hoping to take on the role of aggregator, whether that's primarily for federating different telcos' edge networks (eg MobiledgeX), or helping developers deploy to a wider variety of edge-datacentre and other locations (eg Ori). 

I'm expecting this space to become a lot more complex and nuanced - some will focus on being true "horizontal" exchanges / APIs for multi-edge aggregation. The telco ones will focus on aspects like roaming, combined network+MEC quality of service and so on. Others will probably look to combine edge with SD-WAN for maximum resilence and lowest cost.

Yet more - probably including Amazon, Microsoft and other large cloud companies - will instead look to balance between edge vs. centralised cloud for different workloads, using their own partnerships with edge datacentres (perhaps including telcos) and containerisation approaches like Amazon's Greengrass.

Lastly, we may see the emergence of "neutral-host" networks of edge facilities, not linked to specific telcos, data-centre providers or fibre owners. These could be "open" collaborations, or even decentralised / blockchain-based approaches.

The "magic bullet" here will be the ability to cope with all the network complexities I mentioned above (which drive access paths and thus latencies), plus having a good geographic footprint of locations and interconnections. 

In a way, this is somewhat similar to the historic CDN model, where Akamai and others grew by placing servers in many ISPs' local networks - but that was more about reducing latency from core-to-edge, rather than device-to-edge, or edge-to-edge.

I doubt that this will resolve to a single monopoly player, or even an oligopoly - there are too many variables, dimensions and local issues / constraints.

 

Summary and conclusions

There are 3 main models emerging for organising edge-computing services and infrastructure:

• Single-Network Telco Edge
• Local / Interconnected Datacentre Edge
• Federated / Open Edge

These will overlap, and hybrids and private/public splits will occur as well.

My current view remains that power constraints mean that in-network [telco-centric] edge cannot ever realistically account for more than 2% of overall global computing workloads or perhaps 3-5% of public cloud services provision, in volume terms – although pricing & revenue share may be higher for provable lower latencies. Now that is certainly non-trivial, but it’s also not game-changing. 

I also expect that in-network edge will be mostly delivered by telcos as wholesale capacity to larger cloud providers, or through edge-aggregation/federation players, rather than as “retail” XaaS sold directly to enterprises or application/IoT developers.

I’m also expecting a lot of telco-edge infrastructure to mostly serve fixed-network edge use-cases, not 5G or 4G mobile ones. 5G needs edge, more than edge needs 5G. While there are some early examples of companies deploying mini-datacentres at large cell-tower “hub” sites (eg Vapor.io), other operators are focusing further back in the network, at regional aggregation points, or fixed-operator central offices. It is still very early days, however.

The edge datacentre business has a lot of scope to grow, both in terms of networks of micro-datacentres, and in terms of normal-but-small datacentres in tier-2/3/4 cities and towns. However, it too will face complexities relating to multi-access users, and limited footprints across many locations.

The biggest winners will be those able to link together multiple standalone edges into a more cohesive and manageable developer proposition, that is both network-aware and cloud-integrated. 

The multi-network, multi-cloud edge will be tough to manage, but essential for many applications.

It is doubtful that telco-only edge clouds (solo or federated) can work for the majority of use-cases, although there will be some instances where the tightest latency requirements overlap with the best-defined connectivity models.

I'm tempted to create a new term of these players - we already have a good term for a meeting point of multiple edges: a corner. Remember where you first heard about Corner Computing...

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