Telco edge computing (2)

 

Taken and extracted from STL Partner's article Telco edge computing: How to partner with hyperscalers, August 2020

Telcos and hyperscalers want to capture the value at the edge, but they need to work together to deliver of edge computing solutions and generate demand among customers. 

Edge computing is getting real

Hyperscalers such as Amazon, Microsoft and Google are rapidly increasing their presence in the edge computing market by launching dedicated products, establishing partnerships with telcos on 5G edge infrastructure and embedding their platforms into operators’ infrastructure.

Many telecoms operators, who need cloud infrastructure and platform support to run their edge services, have welcomed the partnership opportunity. However, they are yet to develop clear strategies on how to use these partnerships to establish a stronger proposition in the edge market, move up the value chain and play a role beyond hosting infrastructure and delivering connectivity. Operators that miss out on the partnership opportunity or fail to fully utilise it to develop and differentiate their capabilities and resources could risk either being reduced to connectivity providers with a limited role in the edge market and/or being late to the game.

Edge computing or multi-access edge computing (MEC) enables processing data closer to the end user or device, on physical compute infrastructure that is positioned on the spectrum between the device and the internet or hyperscale cloud.

Telco edge computing is mainly defined as a distributed compute managed by a telco operator. This includes running workloads on customer premises as well as locations within the operator network. One of the reasons for caching and processing data closer to the customer data centres is that it allows both the operators and their customers to enjoy the benefit of reduced backhaul traffic and costs. Depending on where the computing resources reside, edge computing can be broadly divided into:

• Network edge which includes sites or points of presence (PoPs) owned by a telecoms operator such as base stations, central offices and other aggregation points on the access and/or core network.
• On-premise edge where the computing resources reside at the customer side, e.g. in a gateway on-site, an on-premises data centre, etc. As a result, customers retain their sensitive data on-premise and enjoy other flexibility and elasticity benefits brought by edge computing.

The edge computing opportunity for operators and hyperscalers

Many operators are looking at edge computing as a good opportunity to leverage their existing assets and resources to innovate and move up the value chain. They aim to expand their services and revenue beyond connectivity and enter the platform and application space. By deploying computing resources at the network edge, operators can offer infrastructure-as-a-service and alternative application and solutions for enterprises. Also, edge computing as a distributed compute structure and an extension of the cloud supports the operators’ own journey into virtualising the network and running internal operations more efficiently.

Cloud hyperscalers, especially the biggest three – Amazon Web Services (AWS), Microsoft Azure and Google – are at the forefront of the edge computing market. In the recent few years, they have made efforts to spread their influence outside of their public clouds and have moved the data acquisition point closer to physical devices. These include efforts in integrating their stack into IoT devices and network gateways as well as supporting private and hybrid cloud deployments. Recently, hyperscalers took another step to get closer to customers at the edge by launching platforms dedicated to telecom networks and enabling integration with 5G networks. The latest of these products include Wavelength from AWS, Azure Edge Zones from Microsoft and Anthos for Telecom from Google Cloud. 

From competition to coopetition

Both hyperscalers and telcos are among the top contenders to lead the edge market. However, each stakeholder lacks a significant piece of the stack which the other has. This is the cloud platform for operators and the physical locations for hyperscalers. Initially, operators and hyperscalers were seen as competitors racing to enter the market through different approaches. This has resulted in the emergence of new types of stakeholders including independent mini data centre providers such as Vapor IO and EdgeConnex, and platform start-ups such as MobiledgeX and Ori Industries.

However, operators acknowledge that even if they do own the edge clouds, these still need to be supported by hyperscaler clouds to create a distributed cloud. To fuel the edge market and build its momentum, operators will, in the most part, work with the cloud providers. Partnerships between operators and hyperscalers are starting to take place and shape the market, impacting edge computing short- and long-term strategies for operators as well as hyperscalers and other players in the market.

Major telco-hyperscalers edge partnerships

What does it mean for telcos?

Going to market alone is not an attractive option for either operators or hyperscalers at the moment, given the high investment requirement without a guaranteed return. The partnerships between two of the biggest forces in the market will provide the necessary push for the use cases to be developed and enterprise adoption to be accelerated. However, as markets grow and change, so do the stakeholders’ strategies and relationships between them.

Since the emergence of cloud computing and the development of the digital technologies market, operators have been faced with tough competition from the internet players, including hyperscalers who have managed to remain agile while building a sustained appetite for innovation and market disruption. Edge computing is not an exception and they are moving rapidly to define and own the biggest share of the edge market.

Telcos that fail to develop a strategic approach to the edge could risk losing their share of the growing market as non-telco first movers continue to develop the technology and dictate the market dynamics. This report looks into what telcos should consider regarding their edge strategies and what roles they can play in the market while partnering with hyperscalers in edge computing.

Indonesia Digital

Pada era digital seperti sekarang ini, masyarakat didorong untuk menyelesaikan kegiatan atau tugas sehari-hari secara digital/online. Pada tahun 90 an internet masih dianggap barang mewah, tetapi di tahun 2019 sudah sangat mudah bagi masyarakat untuk mendapatkan akses internet dengan kecepatan yang memadai. Saat ini, masyarakat di kota-kota besar sangat bergantung kepada ketersediaan internet karena sebagian besar dari aktivitas yang dilakukan membutuhkan internet. Hal ini terus didorong dengan berkembangnya produk dan layanan digital yang mempermudah kehidupan masyarakat baik secara usaha maupun kehidupan sehari-hari. 

Menurut Google dan Bain & Company pada e-Conomy SEA 2019 Report, ekonomi internet Indonesia pada tahun 2019 berada pada tingkat USD 40 miliar, dan ditargetkan mencapai USD 130 miliar pada tahun 2025 atau diperkirakan akan tumbuh lebih dari 3 kali lipat. Dengan tren penggunaan internet yang terus meningkat, prospek penyediaan produk dan layanan digital dapat terus berkembang untuk dapat memberikan kemudahan kepada masyarakat. 

Berdasarkan Kementrian Koperasi dan Usaha Kecil Menengah, jumlah pengusaha bisnis di Indonesia meningkat dari hanya 1,67% menjadi 3,10% dari total penduduk Indonesia, dimana seluruh bisnis tersebut membutuhkan public awareness untuk mendapatkan pelanggan baru dan juga meningkatkan penggunaan produk atau layanan yang ditawarkan pada bisnis. 

Periklanan menjadi salah satu cara utama bagi para bisnis mendapatkan public awareness, menurut Nielsen, penetrasi media internet dan OOH secara berturut-turut menempati peringkat kedua dan ketiga, menggantikan posisi koran dan radio. Selain itu, adanya kombinasi dengan digital advertising dimana iklan dapat menargetkan pelanggan dengan kriteria tertentu sehingga kegiatan marketing para pelaku bisnis dapat lebih efisien. Dengan demikian, ke depannya mayoritas perusahaan akan beralih memasarkan produknya melalui periklanan digital untuk membantu menerapkan strategi digital yang komprehensif untuk membantu mereka meningkatkan pertumbuhan pendapatan.

Di Indonesia, industri media dan hiburan kini didominasi oleh platform digital terutama platform video-streaming dan gaming. Berdasarkan Nielsen, platform streaming untuk mengakses konten video, portal TV online, internet TV berlangganan menjadi platform “favorit” bagi pengguna layanan internet. Seiring dengan perubahan perilaku masyarakat yang semakin meningkat dalam menggunakan internet, maka kebutuhan layanan komunikasi data dalam sisi jangkauan maupun kecepatan semakin meningkat. Penetrasi jaringan broadband yang masih rendah serta masuknya era teknologi 5G, mendorong pembangunan infrastruktur  teknologi komunikasi saat ini.