Less than six months after launching its 5G core portfolio, HPE says it has won two 5G customers, at least one of which is a Tier 1 North American operator. That doesn't mean HPE will provide the entire 5G stack, since operators are expected to build their 5G cores with multiple vendors. But it does show that HPE's as-a-service approach to the 5G core is gaining traction.
"5G is definitely our growth area and we are hyper-focused on it, and hyper-focused on core," said Jeffrey Edlund, CTO for HPE's Communications and Media Solutions group. His team has created cloud-native versions of six core network functions, and by year-end it plans to have a fully integrated core network stack, available to operators å la carte. "Everything that we're bringing to the market in regards to 5G can be consumed as a service," Edlund said.
HPE is pitching operators and public cloud providers on its ability to deliver world-class IT infrastructure combined with software developed by a longtime telco core vendor. The company has been selling telecom network equipment for decades and counts more than 230 carrier customers. "We're the best-kept secret in the carrier environment," said Edlund. "But if you happen to use an iPhone on a carrier in the US ... our software has touched your life." HPE handles subscriber data management for most of the major carriers, Edlund said. The integrated Home Subscriber Server (HSS) is one of the network elements HPE has migrated to the cloud.
HPE is helping one of the hyperscale cloud companies build a private 5G offer, and the cloud-based HSS is a key contribution here, according to Edlund. "We have a microservice-based HSS that's containerized," he said. "We were able to put it in their cloud, configure it and get it taking traffic for their enterprise communications demo in two hours," he said. He hopes that down the road the customer will want a universal license for HPE's HSS, but for now he expects to sell "HSS by the drink."
Hyperscale cloud providers, telecom network operators and systems integrators are all target customers/partners for HPE's communications unit, Edlund said. But despite his company's position as a leading provider of IT infrastructure to enterprises, the communications and media unit is not set up to sell private networks directly to enterprise customers. "We are definitely going to have a play there, but you're not going to see us go direct to enterprise," Edlund said. "What we're going to do is be an arms dealer to the CSPs [communication service providers] and the hyperscalers."
HPE sees its primary competitors in 5G as Ericsson, Nokia, Huawei and ZTE – the traditional network equipment vendors. However, even when service providers choose a competitor's solution, HPE's server business can benefit.
"Nokia or Ericsson or any of the big companies will deliver on HPE and it's often the chosen COTS (commercial off-the-shelf) environment," said Caroline Chappell, research director at Analysys Mason. "If you don't want the full stack from Ericsson or Nokia and you're going to disaggregate the hardware, then you're very likely to at least consider HPE."
HPE sees cloud service providers more as partners or customers than as 5G competitors. And although the company is working hard to offer cloud-based 5G core components, it doesn't view every other company working in that space as a competitor. In fact, many of them are HPE partners.
Like many vendors, HPE wants to partner with other companies in order to create a multi-vendor solution for the 5G core. Freedom from dependence on a single supplier is one of the promises of a virtualized network, and upfront integration of multiple components from different vendors is expected to speed deployments.
HPE's laundry list of 5G partners includes Affirmed Networks, Openet, Casa Systems, Metaswitch, Mavenir, Samsung, Intel, IBM/Red Hat, Dell's VMWare, Apstra, AMI, Tech Mahindra and World Wide Technology. Several of HPE's partners have been acquisition targets this year. Openet recently agreed to be bought by Amdocs, and Affirmed and Metaswitch are now part of Microsoft. Going forward, these companies could have less authority to decide which solutions they license to HPE, but that's just one part of the partnership equation. HPE can also sell its solutions to these companies as they charge into the 5G core market.
Affirmed is a good example. HPE has licensed software from Affirmed, and Affirmed has licensed HPE's subscriber data management solution. Edlund said that through Affirmed, HPE is reaching Tier 3 and Tier 4 operators that its own sales force doesn't typically approach. Now that Microsoft owns Affirmed, the relationship is expanding. Edlund expects Microsoft/Affirmed to sell the HPE solution and serve it from the Microsoft cloud.
Although HPE and Microsoft are both selling 5G core solutions to operators, Edlund said he doesn't see them as competitors. "We will just be an arms dealer," he said.
HPE's ambition to be an arms dealer to the telcos, hyperscalers and systems integrators does not stop at the mobile core. The company is engaged in talks with JMA Wireless about a partnership that would let HPE leverage JMA's XRAN solution, a software version of the eNodeB that supports digital RF over fiber.
"I see them as being very interesting as the US government really pushes on O-RAN and the government is looking for US-based manufacturers," Edlund said.
HPE's Aruba Wi-Fi solutions could eventually be part of its RAN solution as well. The company wants to write standards and specifications for gateways required to bring WiFi 6 user equipment into the 5G core.
HPE recently launched a 5G Lab in Fort Collins, Colorado, and is inviting telcos and their partners to test and validate solutions there. As a top provider of so-called "white box servers," HPE is well-suited to provide a neutral proving ground for operators who want to integrate and test virtualized solutions with network traffic.
"HPE provides the underlying infrastructure as a service and then we layer on top of it the platform as a service. We layer on top of that the container platform as a service," said Edlund. "We've been partnering so far with Red Hat for OpenStack and OpenShift. Very soon we'll have VMware and Tanzu in the lab." Open source software is a cornerstone of HPE's 5G strategy. "When you open things up, there's nothing like shining the light of day on something to see if it's secure," Edlund said.
HPE eventually plans to charge a fee to companies that join its 5G lab, but because of the global pandemic the company has said that for now, approved companies who want to join can do so by making a donation to a charity of their choice.
HPE is approaching the market for edge-based solutions with its Edgeline servers and Edge Orchestrator. The latter is part of HPE's GreenLake cloud services platform, which sells everything from private cloud to virtual machines as services that companies can pay for as they need them. GreenLake was a shining star in HPE's bleak second quarter results, suggesting that the company is on the right track with its move to sell edge-based applications as a service.
The company's commitment to edge-to-cloud architectures was underlined by its recent announcement that it will pay almost $1 billion to acquire SD-WAN vendor Silver Peak. Silver Peak will become part of HPE's Aruba unit.
HPE's longstanding relationships with countless enterprise customers can be an asset to network operators who may want to sell edge-based applications or 5G private network services to those customers. As IT and telecom come closer together, HPE has the potential to expand its already significant role in telecom and wireless.
— Martha DeGrasse, special to Light Reading. Follow her @mardegrasse