BARCELONA, Spain – Telecom operators are often dinged for their glacial pace in updating their operations and processes to match those of webscale providers. However, an executive from Telia said calls to adopt a “fast-fail” model have a more significant financial consequence should the “fail” part of that model come to fruition.
Gabriela Styf Sjöman, VP of group networks at Nordic-based operator Telia, speaking during a panel discussion at this week’s Mobile World Congress event, focused on the business model around edge infrastructure and multi-access edge computing (MEC), dropped some reality on the proceedings.
“People are always asking why we don’t innovate more,” Styf Sjöman said. “It’s because the cost of failure in our industry is so high. It takes a year to get the network and supporting systems ready.”
Styf Sjöman explained that most of that cost is connected to legacy systems that operators are often forced to continue to run in order to meet consumer and regulatory needs. “We have a lot of legacy. I don’t have one OSS system, I have thousands of OSS systems,” she said. “The key is to be able to switch off these old systems, but that is easier said than done.”
Amol Phadke, managing director for global network transformation at Accenture Consulting, noted in a separate interview that one of the tenants for organizations making a digital transformation journey is to adopt that fail-fast mindset.
“It’s better to test it out quickly and move forward or not,” Phadke said of those organizational efforts. He did admit that it’s a tough model to implement, especially for larger operators, but that they need to at least begin to make that transition if those operators ever expect to garner much-needed operational efficiencies.
Pricing Models
Styf Sjöman said her carrier is always looking to balance costs associated with network deployments with the ability to appropriately charge for services.
“We are not focused on being the first to deploy 5G, we want to be the first to make money on 5G,” Styf Sjöman said. “That’s not as simple as deploying 5G.”
That cost challenge was also tagged to specific enterprise use cases, which she said in some instances are rigorous. She noted some services being requested by enterprises will require 100 percent reliability and full security. This is why Telia no longer looks at just the price-per-bit ratio for network deployments, but the “cost-per-millisecond” and the “price-per-9,” she said.
MEC Focus
Back to the MEC topic, panel members laid out benefits and challenges for adding such capabilities to a network architecture.
Ericsson, one of the larger vendors looking to take advantage of opportunities around MEC, was understandably high on the market’s potential.
“5G will allow the edge to be used as a computing platform using distributed cloud technology,” said Ulf Ewaldsson, SVP and head of business area digital services at Ericsson. He noted that once deployed, the realization about what can be achieved will be similar to what was witnessed with the first smartphones.
Ewaldsson said advances in network air interface and computing power have made MEC a reality, but the transporting of network traffic has become a bottleneck that currently limits the effectiveness of MEC. He cited Ericsson’s tests that have shown air interface latency dropping from around 20 milliseconds with 4G LTE to around 3 ms for 5G; compute and core latency being slashed in half down to 1 ms with the same technology evolution; but transport latency still dangling between 1 and 17 microseconds per kilometer traveled.
Ewaldsson noted that for data that needs to travel more than 1,000 kilometers, that transport latency adds up and is becoming the main component to the issue.
“This fact makes us hunt down that delay and is a driving force behind the distributed cloud,” Ewaldsson said.
John Baker, SVP of business development at Mavenir, noted that deployment challenges will also need to be overcome.
“The ability to have Dell ship a box and as soon as the IT guys plugs it in it all self provisions is the end-goal,” Baker said. He added that this also allows an operator to “start charging for that service immediately,” helping to offset costs.
Styf Sjöman echoed those deployment cost concerns, claiming that a majority of costs associated with new technology upgrades goes to installing that technology into the network as opposed to purchasing the equipment or software.
“I want to spend more capex on equipment, but most goes to construction, site rental, preventive maintenance, and support,” she said. “Very little goes to new equipment.”
