The move to AI and cloud native is accelerating amongst network equipment and IT vendors which have announced highly integrated smart cloud solutions designed to migrate their telco customers into a new and profitable cloud future.  The Cloud Native Computing Foundation (CNCF), as the name suggests, is a vendor-neutral consortium dedicated to making cloud native ubiquitous. The group defines cloud native as a collection of “technologies [that] empower organizations to build and run scalable applications in modern, dynamic environments such as public, private and hybrid clouds. Containers, service meshes, microservices, immutable infrastructure and declarative APIs exemplify this approach.”

CNCF writes that the cloud native approach “enable[s] loosely coupled systems that are resilient, manageable and observable. Combined with robust automation, they allow engineers to make high-impact changes frequently and predictably with minimal toll.”

In particular, Ericsson, HPE/Juniper, Cisco, Huawei,  ZTE, IBM, and Dell have all announced telco end to end solutions that provide a platform for new services and applications by integrating AI, automation, orchestration and APIs over cloud-native based infrastructure.  Let’s look at each of those capabilities:

1. AI (Artificial Intelligence): Leveraging AI capabilities allows telcos to automate processes, optimize network performance, and enhance customer experiences. By analyzing vast amounts of data, AI-driven insights enable better decision-making and predictive maintenance.
2. Automation: Automation streamlines operations, reduces manual intervention, and accelerates service delivery. Whether it’s provisioning new network resources, managing security protocols, or handling routine tasks, automation plays a pivotal role in modern telco infrastructure.
3. Orchestration: Orchestration refers to coordinating and managing various network functions and services. It ensures seamless interactions between different components, such as virtualized network functions (VNFs) and physical infrastructure. By orchestrating these elements, telcos achieve agility and flexibility.
4. APIs (Application Programming Interfaces): APIs facilitate communication between different software components. In the telco context, APIs enable interoperability, allowing third-party applications to interact with telco services. This openness encourages innovation and the development of new applications.
5. Cloud-Native Infrastructure: Moving away from traditional monolithic architectures, cloud-native infrastructure embraces microservices, containerization, and scalability. Telcos are adopting cloud-native principles to build resilient, efficient, and adaptable networks.

While each company has its unique approach, the overarching goal is to empower telcos to deliver cutting-edge services, enhance network performance, and stay competitive in an ever-evolving industry. These advancements pave the way for exciting possibilities in the telecommunications landscape.  When fully integrated, these technologies will enable the creation of smart cloud networks that can run themselves without human involvement and do so less expensively — but also more efficiently, responsively and securely than anything that exists today.

Our esteemed UK colleague Stephen M Saunders, MBE (Member of the Order of the British Empire– more below) notes that Nokia is not embracing  smart cloud telco solutions, but is instead focusing on individual products. Last October, the company announced strategic and operational changes to its business model and divided the company into four business units.  At that time, Nokia’s President and CEO Pekka Lundmark said:

“We continue to believe in the mid to long term attractiveness of our markets. Cloud Computing and AI revolutions will not materialize without significant investments in networks that have vastly improved capabilities. However, while the timing of the market recovery is uncertain, we are not standing still but taking decisive action on three levels: strategic, operational and cost. First, we are accelerating our strategy execution by giving business groups more operational autonomy. Second, we are streamlining our operating model by embedding sales teams into the business groups and third, we are resetting our cost-base to protect profitability. I believe these actions will make us stronger and deliver significant value for our shareholders.”

Steve says Nokia’s new divide-and-conquer strategy is being reinforced at its sales meetings, according to an attendee at one such gathering this year, with sales reps being urged to laser-focus on selling point products. 

“The telco capex situation at the moment means Nokia — and others — have no choice but to examine every aspect of their business to work out how to adjust for a future CSP market that is itself going through dramatic change,” said Jeremiah Caron, global head of research and analysis at market research firm GlobalData Technology.

Most telcos are increasingly adopting cloud-native technologies to meet the demands of 5G SA core networks and to better automate their services.. However, some telcos are hesitant to fully embrace cloud-native due to concerns about complexity, cost, and reliability.  Other challenges of cloud native are: changing the software development life cycle, privacy and security, guaranteeing end to end latency, and cloud vendor lock-in due to a lack of standards (every cloud vendor has their own proprietary APIs and network access configurations.

References:

https://www.silverliningsinfo.com/multi-cloud/report-smart-cloud-and-coming-paradigm-shift

https://www.fiercewireless.com/5g/op-ed-whither-nokia

Building and Operating a Cloud Native 5G SA Core Network

Omdia and Ericsson on telco transitioning to cloud native network functions (CNFs) and 5G SA core networks

https://www.ericsson.com/en/ran/intelligent-ran-automation/intelligent-automation-platform

https://www.hpe.com/us/en/newsroom/blog-post/2024/02/helping-telcos-succeed-in-the-era-of-6g-ai-and-beyond.html

https://www.cisco.com/site/us/en/solutions/transform-infrastructure/cloud-operating-model-overview.html

https://www.huaweicloud.com/intl/en-us/solution/telecom/cloud-native-development-platform.html

https://sdnfv.zte.com.cn/en/solutions/VNF/5G-core-network/cloud-native

https://www.ibm.com/products/cloud-pak-for-network-automation

https://www.dell.com/en-us/dt/industry/telecom/index.htm#tab0=0

https://www.nokia.com/about-us/news/releases/2023/10/19/inside-information-nokia-accelerates-strategy-execution-streamlines-operational-model-and-takes-action-to-protect-profitability/

https://isabellafer.medium.com/cloud-native-telecom-benefits-challenges-and-open-source-tools-b65ec22457b9

What does it mean for an operator to be cloud native?

Steve Saunders (a.k.a. Silverlinings‘ Sky Captain), is a British-born communications analyst, investor, and digital media entrepreneur.  In 2018 he was awarded an MBE in the Queen’s Birthday Honours List for services to the telecommunications industry and business.

https://www.fiercewireless.com/person/stephen-m-saunders