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  • 5G
    June 20, 2019

Heavy Reading Research Reveals How CSPs Will Reinvent Themselves Through Network-enabled Communications & Cloud

Susana Schwartz
Communications Content Specialist

Heavy Reading’s “Future Networking Survey Report” gathered responses from 61 CSP decision makers around the world. Below are insights on what it reveals in terms of future network-enabled communications and cloud markets as CSPs strive to participate in smart ecosystems (smart cities, smart home, etc.), as well as uncover new revenue sources through virtual networking architecture, such as network slicing.

The survey explores the ways in which 5G, cloud-driven ecosystems, AI, massive IoT, and URLLC services will have an impact, and in the findings it is clear that CSPs want to transcend marginal roles (like providing just connectivity to VNOs or in partnership with SIs). They instead want to move on to own-brand, industry-vertical IoT solutions that leverage either best-of-breed components or end-to-end industry-specific network slices that capitalize on the flexibility, agility, and security benefits they get from their cloud investments.

Worth noting is the fact that when asked about what role they’d want to play in building a smart ecosystem for their next transformative business opportunity, most CSPs in the survey said they would like to provide integrated, industry-vertical solutions consisting of connectivity, platform, applications and devices. It seems they will want to provide those solutions directly to enterprises—as a branded service in various ways, including:

  • As a provider of integrated, industry-vertical solutions consisting of connectivity, platform, applications and devices directly to enterprises as a service;
  • As a value-added channel for partner products through inclusion of connectivity and supplementary services in a managed service;
  • As a destination for the brokering of cloud SaaS services in a two-sided marketplace for industry-vertical solutions;
  • As a wholesale provider of tailored connectivity and supplementary services to a Virtual Operator that specializes in industry-vertical solutions;
  • As a partner to a specialized SI that packages connectivity and supplementary services into an industry-vertical solution.

In these options, it is apparent that to drive growth, service providers must become more than connectivity providers, supplying more of what enterprises need to effectively manage their businesses and take advantage of growing industry trends. This vision is becoming more tangible as developments in 5G continue to evolve, as with a next-gen core designed with a SBA based on cloud-native principles. Many cloud operational models will become available for deployment, helping CSPs to create logical “slices” that meet industry-specific SLAs for key performance indicators around latency, QoS, and others. The communications industry is starting to see further development toward application-specific networks or slices for more connected, secure, and smart end-to-end ecosystems. From those ecosystems, more tailored and dedicated solutions for various use cases and industry verticals will be possible.

To that end, the survey showed that nearly one-third of respondents thought that they would need to forge new relationships and work together with industry specialists to capitalize on 5G. Additionally, 43 percent acknowledged that conversely, 5G would allow new entrants (e.g., vertical market players) to challenge the incumbent providers. This reflects a huge undertaking for service providers, which will need to adjust their goals and processes to become more attuned to the specific needs and regulations of the industries in which their enterprise customers operate.

Standards and Open APIs will be a major component of how service providers create a repeatable and scalable way to address the needs of multifarious industries and organizations. CSPs in the survey identified the technologies they felt would be crucial in enabling an interoperable cloud ecosystem:

  • Open APIs for functions like procurement, settlement, support and assurance between cloud services
  • Industry standards for service functionality and capabilities
  • Cloud brokering platforms that enable the rapid integration of SaaS services across multiple cloud infrastructures
  • Open Source software to build the underlying cloud platform or services themselves

There is convergence among some of the core networking standards, such as 3GPP, with IT principles. This has become a fundamental enabler to doing network slicing in a much more effective way by truly leveraging the flexibility, agility, and security of the cloud. Although open source serves foundational technology as well, it alone has not been enough to promote the interoperable cloud ecosystem the industry needs. Efforts around open APIs, like the ones promoted by the TM Forum and the Linux Foundation, will also become increasingly important for service providers to realize this vision.

To find out more granular details about these and other topics covered in the study (security, modern BSS, DevOps, Cloud Native, among others), download the research here:

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