Voice and Data|October 2020
Will edge computing help telcos increase their revenue share from the enterprise market or does it mean more struggle for them, and how?

We always had the pipe. But it took some time and a fresh pair of eyes to see that the pipe can be a wind-chime or a pair of drum-sticks too, besides being the stove accessory or an oil conduit that it was, all this time. It could do things more exciting than the dry chores it was limited to so far. It must have been many years, likewise, after a typical telco planted the network as a ‘bit pipe’ when someone came and fiddled with it to simply mutter: Hey, this can be a great digital business platform, a superb way to deliver Edge applications.

Someone else heard those words and thought, yes why not? Operators have the best spatial advantage here already. They can monetize the pipes that are already there and also offer that low-latency factor and proximity that an enterprise always wanted and has been trying to get in the form of cloud. The operators can easily offer compute, storage and connectivity to their customers with their existing local footprint/real estate and the unique last-mile position for the depth and speed that such applications need.

And so arrived (drum-roll): Edge computing. A unique stripe of computing that helps a telco to provide distributed computing and storage resources very close to the location where they are needed for specific application use cases. It enables them to bring some cloud capabilities like computing, storage and networking physically closer to the user by the sheer proximity of location of a widely distributed compute infrastructure.

With an Edge offering, a telco can offer an enterprise a new breed of applications around internet of things (IoT), augmented reality, virtual reality, cloud robots, and smart factory thanks to low-latency factors, better quality of service, real-time intelligence, and some really-instant, but closed, data-feedback loops.

What’s the pipe worth?

So, would Edge actually be a considerable revenue opportunity ahead, and for whom – the hyper-scale cloud providers or telcos or both?

We posed this question to Omdia’s Carrier Network Software Principal Analyst Stephanie Gibbons who specializes in service providers’ network upgrade strategies. Gibbons offered some very fresh insights from a survey done on Network Functions Virtualization (NFV) and Edge to answer this point.

“We asked 102 operators about which edge applications respondents believe will generate the most revenue. Industrial IoT (IIoT) or automated factories outrank all other applications. This is not surprising given how the manufacturing setting served as one of the first PoCs in connecting devices, processes, and cloud-based analytics,” she said.

When edge applications were evaluated on the potential of revenue, IIoT and automated factory areas topped this list (48%), followed by Private LTE (38%), while video content delivery (31%), smart cities (28%) and supply-chain management like trucking and asset management (25%) also emerged as notable areas here, Gibbons said.

OrionX Founding Partner and Analyst Shahin Khan also reckons Edge as a note-worthy revenue opportunity for Telcos. “They have a literal front-row seat to point of inception, point of sale, and point of control, and as 5G continues the black-hole of faster communication, bringing everything closer to each other,” he explained.


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October 2020