Think of pretty much any other industry sector, and odds are it will be ahead of the telcos in its utilization of the public cloud. Even the finance industry, with similar legacy application baggage and regulatory issues, is moving critical workloads to the public cloud to benefit from the myriad advantages - massive cost savings being just one.
Services from the public cloud hyperscalers like AWS, Microsoft Azure and Google Cloud are better in every way - more flexible, more secure, offering top class software, rapid development capabilities and unrivalled security - to name just a few. Telcos need to wake up to the fact that using the public cloud in as many ways as possible is a benefit to embrace, not a threat to your business. Here are my four predictions - good and bad - for 2021 as the telco industry starts to realize all the possibilities of the public cloud:
#1: OpenRAN starts to really accelerate - it's not just a flash in the pan
Danielle Royston,
CEO &
Founder,
TelcoDR
Major telcos are beginning to kick the tires on this idea; network vendors not so much. As OpenRAN begins to pick up steam, it’s the major network vendors that are going to feel the pain. The winners will be the telcos, who will spend less on hardware (90% of network spend is on RAN), and have more features delivered via software. This will move them into a reality where it is easier to upgrade and easier to change suppliers.
Rakuten has placed OpenRAN at the centre of its 5G network roll-out strategy - declaring 40% savings on capex - a number too big to ignore. But beware the floodgates: once it has been proven that OpenRAN is attainable on a national scale, telcos will fall like dominos and will never go back to the old way of creating networks using fixed hardware. Want proof that this is going to happen? Check out Vodafone in Wales and the South West of England, Telefonica Germany, Rakuten Mobile unveiling 'Tada' 5G. By the end of 2021, I predict this list will only grow longer.
#2: A major telco will take the decision to move their IT workloads to the public cloud
Like OpenRAN, this will be the tip of the iceberg. By moving 75 to 80% of IT workloads to the public cloud, telcos can save 50% or more on their IT costs. My hope is that the telco that does this publishes its results and shares with the world the cost savings, revenue improvements, operational efficiencies and enhanced customer experiences that have been generated.
Who’s leading the charge? I’m keeping my eye on Deutsche Telekom, which has said that it is moving 60% of its IT applications to AWS and Azure, shutting down 76 data centers, and saving triple digit million euros annually. Other contenders include UK MVNO Giff Gaff, which moved everything to the public cloud, and Globe Telecom in Philippines which is doing it with AWS.
#3: There will be an epic fail as other telcos look to follow the lead above
Citing some of the ridiculous excuses of why they can’t (reality: don’t want to), a telco will take the allegedly “safe route” and move to the private cloud instead of taking the straight path to the public cloud. A carrier that builds its own private cloud may waste a ton of money, not achieve any savings, and even worse, be slower to market than their competitors as they insist on tackling and re-solving all the issues with building the stack themselves. This will shine a harsh spotlight on the fact that much more needs to be done to educate telcos on how counterproductive private cloud is, and how they can start their journey to the public cloud, ASAP.
#4: The hyperscalers continue to fight over telco, and see there's a big opportunity to win our industry.
Watch out, because the fight is heating up. With telco being a big industry that’s last to the cloud party, the big three cloud vendors see our industry as a huge opportunity to win market share. This will be all to the telcos’ benefit: price wars, discounts, free services as they fight each other to win our business.
Want some examples of the fight? Look at the Azure for Operators announcement, or the Google cloud announcement in March 20 and December 20. The fight is on for your business as the cloud giants fight for the last industry to really migrate to the public cloud. As they say in Texas, you should get while the gettin’s good.
So there you have it, my predictions for the coming year. Moving to the public cloud is a big step for telcos. With the year we have had I think there has been a huge wake up call for the telcos that in spite of all of their glorious disaster recovery planning, they didn’t account for a global pandemic with a lockdown lasting months on end. I think telcos’ eyes have finally been opened to the possibility and advantages of using the public cloud and it’s about time. I declare 2021 to be the “Year of the Public Cloud.”
