Over the past ten years, and almost by stealth, software has woven its way into the fabric of the telecommunications industry. Each year it plays a more important role, and each year it places itself firmly in the driving seat of innovation. It is indeed no accident that this evolution has gone hand-in-hand with the “cloudification” of services, as enterprises, government entities, and end-users of all kinds want to consume services and content as, when, and how they choose.
Future success will therefore be dictated by those who master the complexities of providing, orchestrating, and supporting fully integrated cloud, content, computing, and connectivity services to their customers. The size of the prize is simply staggering. By 2030, analysts anticipate the SDN/NaaS market will reach around 150 billion USD, the SD-WAN market will reach around 45 billion USD, and the CPaaS market will reach around 50 billion USD, just to mention just a few. If we extend our estimates to include cybersecurity solutions—UCaaS, CCaaS, and Fraud-Protection—we can add an additional 850 billion USD. Fintech solutions could likewise add nearly another one trillion USD, and if we also consider consumer and enterprise use cases for the Metaverse, we may see up to another five trillion USD! There is no denying that this space is where the game will be played in the future, and there will be no consolation prize for those who choose not to compete.
All these solutions have one thing in common: they are and will be software-driven. So what does that reliance on software mean for telecommunications carriers? Here are a few perspectives.
How software impacts back-end operations
If we start with the connectivity infrastructure layer, it is clear that all network fabrics will need to be entirely software-enabled, easily interconnectable, and delivered to customers via self-service NaaS platforms—in other words, the network itself needs to become cloud-native. Customers today require price-competitive, on-demand connectivity services, and the only way to provide such services simply and cost-effectively is via the implementation of software-defined network fabrics. Whilst this implementation is a long process for large carriers with large legacy networks, the virtualization of the network infrastructures to deliver cloud-native services combined with the associated necessary investment in automation (AI Ops) are critical to future success.
