30 June 2020 | Melanie Mingas
Investing huge sums in new technology when core service revenues are in decline is not for the faint-hearted. However, David Noguer Bau, marketing director and SP of product marketing at Juniper Networks, has three tips for those making the move to the cloud.
With each new advance, comes the inevitable scramble to make it pay and no industry is immune.
In the telco space — no stranger to technological advance — the dawn of mobiles followed by the consumer internet created a goldrush of sorts. But as the industry digitises, today’s advances are proving trickier.
5G networks promise new revenue streams through the provision of emerging, low-latency applications: augmented and virtual reality, manufacturing robotics and automated vehicles. These advances demand capital, capacity… and a cloud.
The pace of technological innovation is such that it is now imperative to invest in scalable NFV infrastructure that will be fit for purpose in the technological long term, while also protecting margins against the competition waged by OTTs.
That in itself prompts tough business decisions — the wrong strategy, partners or execution has in the past cost dearly — and some have a long corporate memory. However, when it comes to adding value and growing revenues, the writing is on the wall.
“Capturing this value will not come from adding new gigabits or lines. It won’t. The only way to capture this growth is to go up in the value chain and build a cloud,” says Juniper Networks’ marketing director and SP of product marketing, David Noguer Bau.
For Noguer Bau this series of what he terms “compelling events” has reshaped the industry, and in moving everything towards a digitalised future has already begun to subsidise human capacity with automation and AI.
“We need to set up all the mechanisms so as to allow, ultimately, for a machine to take over operations,” he says.
As any telco knows, re-strategising a mammoth organisation is no overnight job: alongside the business case and the operational needs, execution of the technical piece also requires careful thought.
“This is a big dilemma for the telcos: do I build two separate clouds, one for customers’ services and one for internal needs? Do I build one cloud that I can segment into those two so then I can take advantage of a larger pool of compute resources that I can leverage across the multiple needs?
“Or do I give up and move into a space where hyperscalers can take on this new strategic operation?”
Adding pressure, the wrong choice could have implications that stretch years.
“5G will make telco cloud mandatory for certain applications — you can have a non-virtual packet core (VPC) but the evolution of 5G is so fast on new releases and new functionalities that are coming over time, you cannot have a system that you need to replace several times a year,” he says.
“Having it virtualised, cloud native, you can adapt, increase your environment much easier than if you have a box with limited capability; it has release 13 but you need release 14,” he adds.
Building cloud muscle
As someone who has guided the likes of Orange, Vodafone and T-Systems through such projects, Noguer Bau Offers three pieces of advice for those about to take the plunge. The first: own it.
The trend for consolidation across many areas of the industry suggests that, in acquiring new capabilities, the secret is to partner for success rather than expand at your own risk. But as the quote goes: “Give a man a fish and you feed him for a day, teach a man to fish and you feed him for life.”
As he frankly explains: “Partnering with someone because you don’t have the capability means your will never have your own capability.”
Complementing partner capabilities is permissible, but the solution offering the most flexibility takes another approach.
“Build a horizontal telco cloud that is open and then figure out how to operate it,” says Noguer Bau.
“That means you decide what cloud to build so when you select VPC vendors you change the game. You say, ‘that’s my infrastructure and these are my servers I’m looking for a vendor to provide a VPC that sits here’,” he continues.
The alternative is a vertically integrated telco cloud limited by the imagination and capabilities of the vendor.
“Your destiny will be married to that of your vendor. You will not have the freedom to innovate,” Noguer Bau says.
Interoperability, of course, features on the list, but for ultimate impact Noguer Bau recommends an open build to allow separation of the management of the telco cloud and the VPC.
Going one step further, his second piece of advice is integration, leveraging the capacity of the occasional hyperscaler to secure connections for latency-critical services.
“The main difference between telco and hyperscaler cloud is that hyperscaler works over anyone’s network. But when it works in conjunction with your network it makes things easier or faster or better — ultimately that’s what your customers will experience.
“You need to work in the two domains, and they need to interconnect sometimes.”
The third piece of advice? Buckle up.
Enabling the edge
If the end point — although theoretically that will never exist — is Everest, the transition to cloud is merely the steps in Rocky III. In fact, compared to what comes next, cloud is the tip of the tip of the iceberg.
Noguer Bau cites that, with a value of $4.1 trillion, the internet edge economy in 2030 will be almost equal to the $4.5 trillion internet economy today — and that was at last year’s count.
He says: “The telco cloud is just the beginning of the journey, and many beginnings are not easy, but the next major shift will be better optimised traffic paths and latency.”
Adding to his list of compelling events, for Noguer Bau 5G is the first step to the future, to the widespread availability of latency-critical applications, and to the edge cloud.
“That’s the next big transformation in telcos,” he says. And here is where earlier decisions could come back to haunt executives who cut corners today.
“If a service provider makes those two decisions independently, centralised telco cloud and then the edge cloud, that simple world that you need in order to move applications, that might not be possible because they are not compatible,” Noguer Bau warns.
“So even if you don’t need an edge cloud today, the tip here is to think of an architecture that you can expand or scale whenever you need edge cloud.”
The final part of the puzzle is security.
“It is implicit but I’ll make it explicit,” says Noguer Bau.
Existing technology has exposed flaws beyond anybody’s imagination and an industry built on exploiting them has literally held some of the biggest corporate forces and governments to ransom.
With the cost of attacks, recovery and even data breach fines now all individually reaching the billions on an annual basis, the case for getting ahead of the curve this time gains ground.
“Every one of the steps I defined, they need to go hand in hand with security and security needs to be implemented in parallel, it cannot come afterwards. A failure in that service can damage the corporate image and people may not rely on their services anymore.
“Security is an important topic on its own, but we assume that any telco cloud deployment is secure from day one.”