Communications service providers make slow but steady cloud transition

Posted by Mike Vizard on Mar 30, 2017 9:59:02 AM

Slow and steady.jpegA new global survey of 137 IT decision makers that work for a range of communications service providers finds that the majority are embracing cloud infrastructure to deliver their next generation of services. But even though it may be less expensive to employ public cloud service providers, a full 59 percent of the respondents to the survey conducted by Oracle say they would prefer to maintain control over both their hardware and software even if it winds up being less flexible.

A full 71 percent of the respondents say that shifting to cloud infrastructure will simplify their operations and make them more competitive. But making that shift requires both investments in new technologies as well as substantial changes to organizational processes and cultures. Over half the respondents (53 percent) cited legacy systems as a barrier to transitioning to the cloud. But 51 percent also noted their biggest challenges were non-technical in nature. In fact, over half (56 percent) say they won’t be able to implement a cloud-based platform within the next three years because of privacy, security, and regulatory requirements.

Growing interest in NFV platforms

The good news is that from a technical perspective CSPs are making significant progress. A total of 77 percent report they have either made a lot or some progress in terms of adopting next-generation network function virtualization (NFV) platforms that are critical to both reducing costs and making the communications service provider more responsive to changing customer demand for services.

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Because NFVs eliminate the need for many of the physical appliances that conspire to make it difficult to deliver network services efficiently, interest level in these platforms is high. The challenge is that the software that needs to run on top of these platforms, known as virtual network functions (VNFs), is still in its infancy. In addition, developing management and orchestration (MANO) software for managing VNFs remains a work in progress.

Pressure to embrace new technologies

Just about every communications service provider is feeling pressure from AT&T and Verizon to modernize their IT environments. Both providers are on track to start delivering 5G networking services using mainly open source software that they have invested years of research and development effort to harden.

The issue the rest of the communications service provider community is now wrestling with is to what degree do they want to rely on open source software versus commercial platforms to catch up. At this point, they all know there’s no alternative to transitioning to the cloud to remain competitive. But it’s also clear that access to less expensive IT infrastructure provided by a public cloud doesn’t offer enough of an incentive for communications service providers to give up control of their IT destiny. Most of them will embrace some form of a private cloud instead.

Of course, most communications service providers view those public could service providers as an existential threat to their business. A raft of so-called “over the top” providers of communications services that use public cloud services to provide communications and networking services are starting to move significant amounts of video and audio traffic away from communications service providers. In the face of that competition, many communications service providers may soon discover they don’t have as much time to make the transition to the cloud as they would like to think.

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Topics: IT Services Trends

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