Look for service providers and their customers to be the biggest beneficiaries of the shift in mobile compute power moving to the edge of the network. Rather than having to backhaul traffic generated by applications to a data center, service providers of all sizes will soon be able to provide interactive experiences with real-time applications that run at the edge of their networks.

Earthlink is one service provider leading in this transformation. The company is able to leverage investments in the cloud to reduce its capital expenses while simultaneously enabling the delivery of richer application experiences. In fact, Earthlink CIO Jay Ferro says he believes that most CIOs today would prefer to opt out of building their own data center.

Instead, Ferro says it’s possible to leverage software-defined wide area networks (SD-WANs) and network function virtualization (NFV) software to deliver services via virtual data centers hosted in the cloud. “Trying to duplicate all that infrastructure now is flat out silly,” Ferro says.

Of course, the deployment of 5G wireless networks will give rise to Mobile Edge Computing (MEC) initiatives that will enable delivery of even more advanced applications. Intel expects bandwidth rates of as much as 10 gb/s to be available to mobile computing devices. That’s fast enough to support both augmented and virtual reality applications that are deployed at the edge of a service provider’s network. In fact, the market research firm Ovum predicts there will be 24 million 5G subscriptions for wireless services in place by 2021.

One of the first places wireless networks will be transformed with 5G is in cellular base stations. As part of these MEC initiatives, operators plan to enable applications to run at the edge of the network, or at the cellular base station. This will reduce the network latency that occurs when an end user accesses an application. That time to access the application and run it is dramatically reduced because the application now physically runs closer to the user. Applications that will make use of MEC platforms span everything from augmented reality and real-time video to location-based services and Internet of Things (IoT).

MEC platforms, however, will create management challenges for the operators of those base stations. Not only do they have to publish APIs and software development kits that developers can invoke to create applications that will run on these platforms, they need to invest in management and orchestration frameworks.

There’s a race between traditional carriers and so-called over-the-top providers of applications that leverage networks built by Google and Amazon Web Services (AWS) to overcome this hurdle. While access to backend IT infrastructure in the cloud will be pivotal, the battle itself will be won and lost at the edge of the network.

Cloud infrastructure is essentially a commodity. Creating the network fabric that leverages that backend infrastructure requires more intelligence to be placed the edge of the network using gateways that host applications and provide access to local storage as close as possible to the point of application consumption by the end user. Those applications in turn can then leverage back-end cloud resources to access data as needed.

The next generation of mobile applications are already poised to change the way end users interact with the world around them. But none of that will be possible without first appreciating the advances being made at the edge of the network that will make those experiences possible in the first place.