Before the Covid-19 driven maelstrom of missed or delayed predictions for industry in 2020, Asia’s telco sector was one of those industry sectors poised to effect a few key transformations.
Among these is Edge computing. With the touted benefit of reduced latency, incredibly valuable to IoT (internet of things) real-time applications, enabled by data storage and processing at or near edge devices, IoT and mobile endpoints. That’s the expectation, anyway.
To shift out the hype from Edge computing in the telco sector, Disruptive.Asia recently held a wide-ranging interview with industry leader Danny Wong, senior director for Telecoms, Asia at Vertiv.
Wong remains optimistic about the adoption of edge computing by the industry’s CSPs (communication service providers), noting that: “The advancements in technology in the last couple of decades have been quite impressive and I am looking forward to the next technological marvel. With regards to edge, I am passionate and excited about the potentials of this technology and its impact on people, businesses, and society as a whole.”
Citing a recently released report on telcos and edge computing from technology analyst Omdia, he commented: “With developments in edge computing, companies in the telecoms industry are pushing through with initiatives to move to the cloud. Companies are moving their network infrastructure and services to regional data centres, while local metro networks are positioned much closer to customers and users.”
The shift to cloud computing has in part been driven by the network’s shift to 5th generation (5G) technology as this transformation gives service providers the capability to inject new network features in different locations across their footprint.
“With many communication service providers (CSP) and telecom operators moving towards a software-based, cloud architecture, consumers get the most benefits out of edge computing,” he points out.
With the flexibility and efficiency provided by network function virtualisation (NFV), telecom cloud is providing a platform for edge computing that supports the move from virtual machine (VM) model to a cloud-native, container-based reference architecture.”
The market for edge technology is still young, and there are immense opportunities to flourish in this space. “Currently, there are at least half a dozen types of edge technologies, including mini data centres and edge gateways that are available in the market.”
Pandemic delays 5G?
However, the elephant in the room must be addressed.
Just one major impact of the pandemic fallout was an expected contraction – a record low GDP for 2Q2020 for Malaysia. Economists noted that on the expenditure side, there was a significant contraction in private consumption, investment and net exports. GDP figures for the next quarter – Q3 – may remain in contraction mode as the economy is still running below full capacity.
To offset these, however, there was a marginal contribution from the positive government consumption during the period. Forecasts for GDP growth from local economists are at -4.0% for 2020, though the worst should be over in the light of the recovery mode of Malaysia’s lockdown – called Movement Control Order (MCO).
On a regional and global front, Omdia’s report noted that the Global System for Mobile Communications Association, GSMA, had expected 5G growth to be more significant in the APAC region since it is home to some of the first 5G networks.
“However, with the crisis looming over the region, the total number of 5G connections is predicted to be lower by almost 20% in 2020 as compared to its previous forecast. In some countries in the region, cost-cutting and capital expenditure (CapEx) management including delaying 5G will be implemented to manage balance-sheet strength,” Wong said.
However, in Singapore, 5G adoption remains strong, he notes. The Ministry of Communications and Information announced that the country’s 5G stand-alone deployment by 2025 is on track. “The deployment is set to create a vibrant 5G ecosystem, offering exciting opportunities and benefits for individuals, workers and businesses in Singapore’s digital future.”
In Malaysia, the Telekom Malaysia (TM) group, in collaboration with industry, and encouraged by government regulator the Malaysians Communications & Multimedia Commission, MCMC, has developed multiple 5G use cases aimed around urban improvements, security and economic expansion, under the banner of Digital Malaysia.
A change of government at the beginning of the year coupled with the pandemic cast a fleeting sliver of uncertainty over the country’s bold 5G plans as part of its digital nation-building efforts.
However, the government’s introduction last week of Jendela, a plan to solidify and promulgate a more inclusive nationwide digital connectivity infrastructure, reaffirms the intention to transition to 5G technology in phase 2, in line with the 12th Malaysia Plan 2021-2025 (12MP).
At the same time, advancing 5G technology was also spotlighted by the Malaysian Cabinet when it reportedly approved the National 4IR (4th Industrial Revolution) and Digital Council to steer the socio-economic development of the country through digitalisation.
Another factor is an increase in security vectors attributed to the ongoing coronavirus crisis, Wong notes.
“Monitoring the quality of calls and pliancy of network connections is crucial to ensuring that customers receive the best telecom experience they deserve. However, there is another reason tracking and understanding communication lifecycle is essential to telecoms companies – data security and privacy.”
“As the number of companies using hybrid and remote work arrangements increases, businesses will rely on telecom operators to support their network needs,” Wong elaborates. “Bad actors will see this as an opportunity to exploit weak points in the network and use them for fraudulent activities. In order to protect customers and clients, security and privacy have become a key priority for telecom companies.”
How CSPs can move forward
Wong believes that edge computing is a panacea for growth. “With the implementation and adoption of the edge, CSPs are developing the capability to deliver unprecedented network speeds, greater capacity and massively reduced latency.”
The advantages are simple. “CSPs are developing these capabilities by processing data closer to the source and reducing the physical distance. As a key enabler for many new use cases, within the Internet of Things (IoT) space, new services enabled by edge computing will be increasingly bundled with other enterprise offerings, such as dedicated networks.”
However, there are certain hurdles – or questions around edge computing – that have yet to be answered. CSPs need to address issues such as monetising better performance; achieving better costs and reducing latency balanced against how much the customer is willing to pay.
Other issues along the path of evolution include defining the best business model, identifying partners, and various operational and service delivery processes.
Push to Cloud
As 5G technology and networks evolve, edge computing can provide high-performance, on-demand and cost-effective platforms capable of supporting a growing number of use cases. This was demonstrated in Malaysia with the 5G use cases, many of which envision Langkawi as a smart island and a demonstration of smart city living.
“However, when it comes to new edge services solutions, there are still opportunities for CSPs to determine the right business model and establish sustainable revenue streams,” admits Wong.
A significant move is to push and deepen cloud computing options, that can be illustrated in the launch of Cloud Alpha by TM in Malaysia.
Commenting on Malaysia’s Cloud Alpha, which is positioned as the country’s first comprehensive hybrid cloud service, Wong says: “With 5G technology requiring high-speed connectivity and ultra-low latency, cloud platforms are in a position to help CSPs host network function and offload from the data centre. By leveraging on edge technology, CSPs can host data centres across the nation without the need to acquire new properties.”
“Within APAC, operators in Malaysia, Singapore South Korea, Japan and China are the early movers when it comes to edge cloud infrastructure deployment with commercial applications well underway.,” he continued.
“The three leading operators in China have either begun large scale, pre-commercial edge cloud network construction or are engaged in pilot projects using multi-access edge computing (MEC). CenturyLink has also fortified its global edge delivery footprint in 11 cities across APAC by leveraging the revamped version of its edge computing platform — content delivery network (CDN). “
A collaborative approach will be critical with 5G applications that may require data to cross borders. “In a case where a surgeon in Singapore is performing a survey in Malaysia, both edge sites require similar capacity and latency to leverage on 5G and perform on the patient successfully.”
“The infrastructure architecture of next-generation telecoms and edge brings forth economic benefits to various sectors. With the application of these technologies, the ability of other industries such as agriculture, health and manufacturing to adapt to new technologies is increased,” he adds.
Looking ahead, Danny concluded: “Combined with other technologies such as 5G, IoT, and data analytics, the applications and use cases for edge is immense. In Asia Pacific, particularly Southeast Asia, where social media and online platform usage is high, the adoption of 5G technology is expected to accelerate.”