Technologically, culturally and in terms of business models, the public cloud is still the quandary for telcos. It is no less complex than traditional networking and is perhaps even more complex. It is also risky.
Historically, any one of these concerns would be showstoppers for CSPs that prefer a more principled engineering environment. This explains why, according to TM Forum’s research, most CSPs have deployed less than 5% percent of their operations software in the public cloud, at a time when investment in new operational and business support systems (OSS/BSS) should be on the rise in preparation for 5G.
More operators are deploying BSS in the public cloud, however, and this summer AT&T and Microsoft announced a blockbuster $2 billion, multiyear deal to move all AT&T’s nonnetwork workloads to the Microsoft Azure public cloud. AT&T’s simultaneous proclamation that it is becoming a “public cloud first” company is likely to convince other operators to embrace public cloud, not only for telco operations, but also to target enterprise customers.
The onus in these burgeoning relationships is not all on CSPs. Cloud providers must work closely with operators to address end customers’ needs. They must also recognize that they are working with partners who have invested considerably in network functions virtualization – investments telcos are unlikely to abandon. Just as CSPs need to adapt to cloud environments, cloud providers must learn how to engage with CSPs operating multigenerational networks.
Changing the mindset
It isn’t as if communications service providers (CSPs) are against the concept of cloud. As noted in the introduction to this report, most large operators built their own data centers a decade ago only to sell them off when they failed at being cloud providers. But most CSPs are hesitant to put their own workloads into a public cloud environment, particularly operational and business support systems (OSS/BSS).
This begs an important question as CSPs once again look to target enterprises, this time through partnerships with public cloud providers: If the cloud is not good enough for telco operations, why would enterprises put their workloads there? CSPs will have to come up with an answer.
Expectations for CSPs to move BSS to the cloud have always been higher than for moving OSS. In 2017, TM Forum published a report called Cloud BSS: The migration begins, which found that operators were beginning to test the cloud waters by moving some customer management and revenue management applications. But there was no strategic objective to move the entire BSS stack.
At the time, three quarters of CSP respondents reported having less than 10% of their BSS in the cloud. But operators had begun adopting the software as a service (SaaS) model for some BSS applications, partnering with companies such as Salesforce and SAS.
This is likely why nearly half of respondents to the survey predicted that more than 50% of all BSS would be in the cloud by 2020. We are surveying CSPs now for a Future BSS report to be published in January, but early indications are that operators are nowhere near achieving that prediction.
Truth or Dare
One finding in the BSS survey has proven true, however: Big data analytics are workloads suitable for cloud. In 2017, nearly a third of CSP respondents said they were already deploying or planned to deploy analytics in the cloud. The growing adoption of artificial intelligence (AI) and machine learning is reinforcing this trend.
A 2019 survey of TM Forum’s Digital Transformation World attendees revealed that a full 84% of respondents believe CSPs need to be investing in cloudnative technologies to support this transformation.
There is much less certainty about whether OSS workloads are suitable for cloud, despite previously high expectations. In 2018, TM Forum conducted a survey of CTIOs which revealed that half of CSPs had moved less than 5% of OSS infrastructure to the cloud, but they expected this percentage to increase to 50% within three years.
While their prediction has two more years to come true, operators do not appear to be on a trajectory to realize it. Only 4% of the 99 CSP respondents surveyed for our November 2019 report Future OSS: Towards an open digital architecture said their companies have already transitioned some OSS applications to a public cloud (mostly service assurance applications), and only 5% are planning a full OSS stack transformation. A third said they will move select applications, but a quarter do not plan to move OSS to the public cloud – ever.
The bottom line is that 5G will make it much easier for CSPs to enter new markets and create new lines of business. Operators should leverage the public cloud in the same way that greenfield competitors like Rakuten and Dish Networks intend to – to get to market more quickly at much lower cost. CSPs can introduce public cloudbased BSS and OSS to support new opportunities in the internet of things, managed networks and multiaccess edge computing.
Unlike whales, birds and butterflies, which push themselves to incredible limits to get from one place to another, people in the telecoms industry consistently underestimate the pain and challenges of migration. It’s a tough road with only one golden rule: If there is a safe path that others have followed successfully, use it.
CSPs should look to pioneers that have successfully moved BSS and OSS workloads into the cloud, and they should be willing to share their migration experiences with others by contributing to standards organizations like TM Forum and open source projects. This will make the path less risky for everyone.
Read more about 5G, public cloud and BSS/OSS in TM Forum’s recent report Public Cloud: An essential but not singular solution for CSPs here: https://inform.tmforum.org/research-reports/public-cloud-an-essential-component-for-csps/