Analysis Mason: few private networks include edge computing, despite the synergies between the two technologies

In a report on Private LTE/5G network deployments, Analysis Mason said that “Only 58 of the 363 private network announcements in our tracker explicitly mention that the private network is working with edge computing.”  That’s no surprise as per our recent IEEE Techblog post that edge computing has not lived up to its promise and potential.

The number of announced private networks increased from 256 during the third quarter of last year, to 363 announced deployments during Q3 of this year. Most of that growth is coming from more advanced countries and China “where the IoT markets are mature and are driving demand for private networks.” Private networks using 4G LTE technology continue to dominate the overall market “because it is able to meet the connectivity requirements of most private network applications.” However, 5G is gaining ground with more than 70% of new networks announced this year stating the use of 5G technology.

Private networks and edge computing are complementary as each adds value to the other. When combined, the technologies can support applications that have requirements for low latency and high bandwidth or that need to be located on site for security purposes.

The adoption of edge computing with private networks has been limited thus far due to several factors, such as the relative immaturity of edge technology. The drivers of private network adoption are also different to those of edge computing adoption.

Private LTE/5G networks are often introduced to replace existing Wi-Fi or fibre access networks, and no other changes are made. Nevertheless, the share of private network announcements that mention edge is growing, and more than 20% of the private networks that have been publicly announced in 2022 so far include edge. We expect that more private networks will include edge computing in the next 18–24 months. Some vendors are promoting edge as part of a packaged private network solution (such as Nokia with its NDAC solution).

A few operators, such as Verizon, Vodafone and the Chinese MNOs, are promoting the combination, and many other service providers have trials that combine the technologies.

Verizon Business CEO Sowmyanarayan Sampath who during a recent NSR & BCG Innovation Conference explained that private 5G network momentum was outpacing demand for the carrier’s mobile edge computing (MEC) services.

“On the MEC, what we are finding is demand is taking a little longer to go,” Sampath said. “And part of that is we are having to work back and integrate deeper into their operating system. So it’s going to be much stickier when it does happen [but] it’s going to take a little longer. We’ve got loads of proof of concepts and early commercial deployments, but we shouldn’t see revenue till the back half of next year and into 2024.”

References:

https://www.analysysmason.com/contentassets/5a5a17a309c649fc9a45612e7e4317c2/analysys_mason_private_network_deployments_nov2022_rma17.pdf

https://www.sdxcentral.com/articles/analysis/edge-compute-adoption-inches-along-analysys-mason-finds/2022/11/

https://www.sdxcentral.com/edge/definitions/what-multi-access-edge-computing-mec/

Has Edge Computing Lived Up to Its Potential? Barriers to Deployment

 

 

One thought on “Analysis Mason: few private networks include edge computing, despite the synergies between the two technologies

  1. Light Reading: Demand for edge computing is taking longer than expected to develop

    According to two giant US technology companies – data center operator Equinix and 5G provider Verizon – demand for edge computing seems to have stalled.

    Both companies have argued that they’re well positioned to provide speedy access to computing services via a geographically distributed network of data center locations. But both have also reported slower-than-expected demand for such edge services.

    “Equinix is the leading edge provider for use cases today, as it can cover over 80% of the US population with 10 milliseconds of latency,” noted the financial analysts at Wells Fargo in a report to investors, citing their recent conversation with Equinix’s VP of business development Jim Poole.

    However, the analysts argued that there’s not much demand for anything faster. “There are no material use cases today that require <10 milliseconds, which haven't necessitated Equinix to go deeper into the 'metro edge' (i.e. secondary or tertiary markets)," the analysts explained. "In other words, the challenge on moving deeper into the edge is not a technology issue, but rather an ecosystem one in which developers have not been able to create economic models around new use cases that require those types of low latencies. But Equinix is clearly watching closely and could potentially make a move deeper into secondary/tertiary markets if the opportunity presented itself."
    Equinix is one of the world's biggest data center operators with more than 200 sites around the world.

    Resetting expectations

    On edge computing, Verizon executives have made similar comments.

    "On the MEC [multi-access edge compute], what we are finding is demand is taking a little longer to go," explained Verizon Business CEO Sowmyanarayan Sampath during a recent investor event.

    He added that Verizon now expects to generate MEC revenues starting sometime late next year and into 2024.

    As noted by FierceTelecom, that timeline represents yet another delay for the operator. Verizon CEO Hans Vestberg said in 2020 that Verizon would generate meaningful revenues from MEC in 2022. Then, earlier this year, Verizon CFO Matt Ellis said the operator's public MEC business would generate "significant" revenues starting in 2023.

    "So it's going to take a little longer," Sampath said.

    Verizon, for its part, offers more than two dozen public edge computing locations scattered across the US via a deal with Amazon Web Services (AWS).

    Of course, the lack of widespread demand for edge computing hasn't stopped vendors from hyping the technology. For example, AWS touted its edge computing offerings during its recent re:Invent trade show, according to SDxCentral.

    And Ericsson – one of the world's biggest suppliers of 5G radios – recently wrote that edge computing ought to be a core component of future mixed reality (XR) services. "Without having a sufficiently densified network in terms of RAN [radio access network] and multi-access edge computing (MEC) with an optimized network configuration, wide-area and mobility-supporting XR will be difficult to deliver," Ericsson's Du Ho Kang wrote on the company's website, in outlining the potential networking implications of metaverse-style services.

    https://www.lightreading.com/the-edge/demand-for-edge-computing-is-taking-longer-than-expected-to-develop/d/d-id/782116?

Leave a Reply

Your email address will not be published.

You may use these HTML tags and attributes: <a href="" title=""> <abbr title=""> <acronym title=""> <b> <blockquote cite=""> <cite> <code> <del datetime=""> <em> <i> <q cite=""> <s> <strike> <strong>

*