Listen to any US operator's discussion of their 5G network and you will hear the term "edge" peppered throughout. Verizon calls it the "intelligent edge network" or "5G edge," while AT&T refers to it as "multi-access edge computing" or MEC. T-Mobile is perhaps the least vocal about its edge strategy, perhaps because the company has been much more focused on its 5G network buildout following its purchase of Sprint.
Whatever the name, all three US operators are intent on being edge computing players – but their strategies differ significantly. That isn't surprising considering edge computing is still a fairly new concept and operators are trying to determine what role they will play in the edge ecosystem and how they will benefit.
Research and consulting firm Analysys Mason surveyed 30 top network operators from 12 countries in 2020 and found that most are intent on pursuing edge computing opportunities because they believe the technology is important in delivering new enterprise, IoT and consumer services such as video, robotics and gaming. And while some network operators view public cloud providers like Amazon Web Services (AWS) and Microsoft Azure as potential threats, service providers in the US see them as necessary partners that are critical to their edge implementations.
Verizon breaks it into private and public
Verizon has been the most outspoken US operator about its edge ambitions. The company has partnerships with both AWS and Microsoft Azure. With AWS, Verizon uses AWS Wavelength, which is Amazon's cloud computing platform optimized for the network edge. Developers and businesses can use AWS Wavelength to embed their compute and storage operations inside Verizon's edge network. Currently, Verizon has deployed its 5G edge network in ten AWS locations and will deploy an additional ten locations this year.
During Verizon's analyst event held in March, Tami Irwin, EVP and CEO of Verizon Business, said that the company believes that by the end of 2022 edge computing will be a $1 billion market. By 2025, Verizon forecasts it will be a $10 billion addressable market. Some analysts, however, are skeptical about Verizon's claims. For example, the financial analysts at MoffettNathanson recently said that they believe edge computing services can be handled by a small number of regional data centers rather than thousands of edge compute sites such as what Verizon and others are building.
To be clear, however, Verizon actually has two business models for edge compute – public and private. Irwin said that the company's partnership with AWS Wavelength is its public model that makes it possible for developers to build latency-sensitive apps and use cases such as delivering high-resolution video or virtual reality. Irwin added that Verizon believes it will make money in partnership with AWS by divvying up the recurring revenue that is derived from customers paying for these workloads. "Developers today are building use cases spanning a wide array of commercial applications from healthcare to AI analytics at the edge to sports and entertainment, education and more, all through an easy on-ramp in the AWS portal," Irwin said.
The second model for Verizon is the private edge, which is for customers that want dedicated edge compute infrastructure with ultra-low latency and high levels of security and customization.
Although Microsoft Azure was initially tapped by Verizon for the private MEC model, the operator recently expanded its relationship with AWS so that customers can use both Microsoft Azure and AWS Outposts. Verizon said Corning is its first customer to test its private MEC platform in a smart factory application using AWS.
During a Mobile World Live webinar with Capgemini discussing Verizon's edge strategy, Mark Burgbacher, director of 5G/MEC strategy and innovation at Verizon's Business Group, said that the company works with customers to determine whether the public edge or private edge is a fit for the use case by determining the latency that they require. "The private 5G network and private cloud are there to support latency in the ten-millisecond range," he said, adding that higher latency requirements are usually served by the public edge.
AT&T's MEC expansion plans
Like Verizon, AT&T has also put a strong emphasis on mobile edge compute. Jeff McElfresh, CEO of AT&T Communications, said during the company's March analyst meeting that AT&T will continue to expand its 5G edge solutions this year. He noted that the company already is working with partners such as Microsoft, IBM, Accenture, Google and Deloitte to create customer applications that will benefit from the 5G edge. Like Verizon, AT&T uses video, gaming and augmented reality as frequent examples of applications that will benefit from edge computing.
The company was an early proponent of MEC. Back in 2019, it announced an alliance with Microsoft that tied Microsoft's Azure cloud services to AT&T's network edge locations. The service, called Network Cloud, was initially available to customers in Dallas, Los Angeles and Atlanta.
AT&T also is collaborating with IBM on a private MEC offering, similar to what Verizon is doing. The private MEC offering would allow companies to run workloads on premises with low latency and extra privacy and security.
T-Mobile's fast follower status
Although T-Mobile executives recently talked about the importance of edge computing during their analyst conference in March, there were few details about the company's strategy beyond the mention of a trial that T-Mobile has conducted with an unnamed bank that involved MEC and security.
Nevertheless, the company did partner with Lumen Technologies earlier this month to make Lumen's edge compute nodes available to T-Mobile's enterprise customers. The deal makes sense, given that T-Mobile doesn't have an extensive fiber network to tap into like its counterparts Verizon and AT&T.
Lumen has been in the process of transforming itself from a wireline telco into an edge computing powerhouse and it already has cloud partnerships with Microsoft Azure, Google Cloud and AWS as well as VMware and IBM.
Plus, Lumen claims its edge network can reach 95% of enterprise locations in North America with 5 milliseconds of latency.
By teaming with Lumen, T-Mobile is riding on Lumen's partnerships with the cloud providers. However, this deal isn't exclusive so it's possible that T-Mobile will partner with other edge computing vendors as well.
MEC or the 5G edge is still in its infancy, but the big three US operators are starting to firm up their edge strategies with partnerships and case studies. The next step will be to figure out the business models and see whether these edge strategies can morph into revenue generating-businesses that operators hope they will.
— Sue Marek, special to Light Reading. Follow her @suemarek.