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An existential moment for telcos: Become platforms or face competing with them (Reader Forum)

The pandemic gave us a glimpse at how cloud platforms and connectivity can come together to deliver ingenuity in how we connect — and we’re all eager to see how 5G and Edge computing will supercharge this opportunity. Imagine going from telehealth visits to remote surgeries.

But at the very moment, while telcos are maneuvering to capture this new potential, they’re at risk of running into the same fate that befell legacy media companies recently as cloud hyperscalers and direct-to-consumer streamers cut them out of the lion’s share of profits. (Amazon’s recent acquisition of MGM is the latest cautionary example.)

To own their own destiny, I’d argue that telcos face an existential decision. They must become business services platforms themselves — or face the realities of competing with them.

Embrace hybrid cloud to stay in control

A recent IBM study of communications service providers (CSPs) revealed 74% of the highest performing CSPs agreed that partnering with webscale companies, including hyperscalers, for 5G-enabled edge computing would mostly benefit the strategic interests of webscalers.

For me, this finding makes one thing very clear: Our role as enterprise technology providers must be to help telcos embrace platforms that keep the power of innovation in their hands.

We do this by helping them evolve to business services platforms that support flexibility, choice and consistency in how they innovate. This means embracing cloud architectures that are based on open technologies and industry standards so telcos — and the enterprises they serve — can maintain control of where and how they deploy their network services, edge platforms and new offerings for customers. 

The reality is that 5G will cost substantially more than 4G did to deploy. Essentially all major telcos have announced their commitment to spending billions of dollars in the coming years on infrastructure to support 5G. Because of this, there is a pressing financial urgency for telcos to harness their dominant position in connectivity to deliver a platform for innovation to their customers. And many are already doing this by transforming their network architectures into software-defined platforms that can support growing volumes of 5G and Edge-enabled use cases.

Open hybrid cloud architectures are emerging as the essential platforms that telcos must embrace to support this transformation. Why? Because by design, they ensure that your data remains your data, and your decisions regarding where to move that data, how to harness and secure it, how to create valuable insights from it, and who to partner with to monetize it remain yours.

Make public cloud a part of your IT strategy, not an “either-or” 

Public cloud should be a key part of any telco’s IT transformation strategy, but it’s not an either-or decision, and this is a crucial distinction.

Say, for example, you’ve moved the application layer of your network onto one public cloud. You want to build and deploy new edge applications, but your provider limits what security vendors you can partner with; or maybe you want to continue using a different cloud for sensitive workloads, but your provider won’t support interoperability.

Instead, with an open hybrid cloud approach you can bring together your choice of cloud and on-premises environments as well as third party vendors, all enabled by an open platform that works as a lingua franca for your data. This industry standard compliant architecture fosters the kind of deployment flexibility and industry-wide collaboration that’s necessary to capturing new value from next-gen connectivity. It also supports more ways to monetize the advantages of 5G — including reduced latency, enhanced bandwidth and dedicated network capacity and service quality for clients.

A hybrid cloud model also means you stay in control of your data by infusing enterprise level security in all aspects of the workflows you manage, as well as for those of customers and partners. With an open hybrid cloud approach, you can safely monetize your data because you can continue to own the keys to it, maintain control over your own privacy settings and integrate security and compliance across the breadth of your IT workloads. 

Secure a central role in the 5G future

There is little debate that 5G holds the promise to transform critical services, from smarter utility grids to improving the efficacy of first responders.  If we’ve learned anything from previous market inflection points, it’s that those that retain control of their architectures — as well as how, where and when they deploy services — tend to win the battle for marketplace superiority. 

Telcos must take an open hybrid cloud approach to not just survive, but thrive — not just for themselves, but for their enterprise customers too — as we enter a new era where ‘compute + connectivity’ redefine cloud services.  

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