The public cloud as a platform for telco workloads has failed to make a lot of progress this year, and there have been one or two big setbacks.
The cheerleaders would have you think it is only a matter of time before the public cloud swallows telecom, along with everything else. "Hyperscaler" economics and artificial intelligence (AI) urges make it inevitable that operators will eventually move telco workloads, along with less mission-critical IT, into the giant data centers operated by Amazon Web Services (AWS), Google Cloud and Microsoft Azure for thousands of multinational clients. Unfortunately for the cheerleaders, it is just not happening.
Some operators, especially in Europe, remain actively resistant to use of the public cloud for telco-specific workloads. They include the UK's BT, which previously invested time and effort in building its own telco cloud with Canonical, a UK software company. Germany's Deutsche Telekom has something similar called T-CaaS. Orange also has a homegrown cloud.
The latter has not ruled out a public cloud move in future. But this would first have to satisfy European rules about data protection and sovereignty. Typically, that means data must be stored locally. The likes of AWS have responded by investing in European facilities. Yet sovereignty is not the only telco concern.
In 5G, operators have distributed their previously centralized workloads around a nationwide network, bringing resources into closer proximity with end-user devices. Doing so can lead to a reduction in latency, the time a signal takes to travel around the network, as well as other service improvements, they say. BT, for instance, hosts its control plane functions at eight UK sites and its user plane software at 16. Replicating this in the traditional public cloud, which relies on a smaller number of giant facilities, would be difficult if not impossible.
And so the public cloud providers have adapted to what are essentially private cloud needs. Rather like IBM-owned Red Hat or Broadcom-owned VMware, the best-known cloud-computing players in this area, they now offer to bring their technologies into a telco's facilities. Microsoft calls it the "hybrid" cloud.
Uncompelling economics
The economic case, however, is obviously not as strong as it is when resources can be shared with numerous other companies. Spain's Telefónica, moreover, is still not fully convinced by the other benefits of the public cloud providers. Automation is currently more advanced when both the core network software and infrastructure come from Ericsson than it is when Telefónica takes the core from Nokia and the infrastructure from AWS, according to Cayetano Carbajo, the operator's director for core networks.
Ericsson's software, he explained, is optimized for its own infrastructure. Nor do AWS and Nokia currently offer lower costs, he said. He still regards an AWS and Nokia deployment in Germany as a test and points out that only 1 million of about 45 million customers are supported by those companies. The rest continue to be served – for now – by the older Ericsson setup.
Carbajo is also clearly perturbed by the lack of infrastructure standardization in a world of multiple different offers. Various telcos are working on this through an initiative called Sylva, overseen by the Linux Foundation. The fruit of it should be the ability for Telefónica to move network applications from one cloud to another without having to make big changes. Yet the public cloud providers are not even listed as sponsors on the Sylva website.
There is scant evidence of other public cloud network moves by the "brownfield" operators that account for most of the telecom market. And there was seemingly bad news for public cloud advocates in June when Microsoft was revealed to be cutting telecom jobs and abandoning Affirmed Networks and Metaswitch, core network software developers it bought in high-profile deals several years ago.
Microsoft is apparently still committed to the infrastructure side of things, merely retreating from the development of network applications. But the move hardly instils confidence in its ability to handle a telco's network needs.
Here is a roundup of our public cloud stories this year:
1/19/2024 The public cloud has failed to crack telecom
2/26/2024 Microsoft 5G deal with Etisalat ups rivalry with Ericsson, Nokia
4/8/2024 Orange needs Sylva bullet as telecom mushrooms clouds
4/23/2024 Rakuten hones pitch to be one cloud for all telco needs
6/4/2024 Layoffs crash into Microsoft's Azure for Operators
6/11/2024 Ericsson battles Nokia and AWS in Telefónica's war of two clouds
6/13/2024 Microsoft to quit Affirmed and Metaswitch in telecom retreat
6/26/2024 Telenor has a go at public cloud but needs AWS to help
6/27/2024 Public cloud economics aren't adding up for some telcos
10/29/2024 Orange is still figuring out what to do about Nokia
12/5/2024 Telefónica still not fully sold on public cloud after AWS move
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