Operators have been moving their core networks to the cloud far more slowly than most observers had expected a few years ago. Although the packet core has often been the first element to be virtualized, most early movers have deployed only limited core functions as virtual network functions (VNFs).
However, the move from the first 5G Non-Standalone (NSA) deployments to full Standalone systems, which require a 5G core, will be a significant trigger. Many of the promises of the full 5G model rely on a flexible, cloud-native core, and we will see a rising tide of operators moving on from merely virtualizing the core on off-the-shelf hardware, to implementing a fully cloud-based platform built around microservices and containers.
Another major change which may be driven by this progression is a move to the public cloud. So far, operators which have virtualized critical functions like the packet core have generally used their own data centers or private clouds. A few, according to Rethink’s latest survey of over 80 MNOs planning for 5G, have their new cores hosted in the cloud of a supplier such as an OEM (an extension of the managed services offered by the big vendors).
In general, there has been considerable caution about the idea of critical functions being hosted in a public cloud like Amazon AWS, Microsoft Azure, Google Cloud or Alibaba in China. The fears that always accompany outsourcing deals – lack of control of critical systems, change in culture and organizational structure – are magnified when the public cloud is involved. Amazon AWS has acknowledged this when it pushes its edge cloud services, saying that some telcos will use the edge as a way to put a cautious foot in the public cloud waters – so a localized packet core deployed for a particular IoT service, for instance, could be a gateway to bigger cloud projects in future.
All these cloud giants are looking keenly at the opportunity to host telco networks on their platforms, since 4G and 5G cores and gateways – and eventually even RANs – are a brand new market, with operators only just slowly moving away from the proprietary, vertically integrated systems of the past.
As well as operators’ smaller packet core projects, another way to infiltrate the market and prove their credentials is to target enterprises which want to deploy their own mobile cores and RANs. As we have analyzed in detail, a feature of the 5G era will be an increasing variety of deployers, and there will be many industrial service providers, neutral hosts and private enterprises which choose to roll out their own local cellular networks, often with self-contained cores, edge nodes and small cell RANs. These may be in spectrum leased from the MNO, or awarded for industrial use (as in Germany), or in shared spectrum.
These enterprises and their providers may be a better target for the cloud giants in the first stage than the MNOs’ 5G projects, since they are more likely to be accustomed to the public cloud model. The hope will be to prove the robustness, security and cost-effectiveness of this model to large operators, in time for their big cloud-native 5G deployments, by starting with more modest roll-outs in other sectors.
The Japanese vendor, NEC, is showing the way in a new alliance with AWS. NEC has largely been excluded from the RAN market outside of its home market and small cells, but is targeting private and enterprise networks as a way to increase its business in the access network (it is a backhaul major). Its deal with AWS will see it offering a virtualized core which can be configured to run on-premises or in the AWS cloud. It will implement a cloud-native 5G core itself first and then offer it to enterprise customers, targeting sales of $93m by the end of 2021.
The next step is likely to be to target smaller operators, which want to avoid the cost of deploying cloud-native systems on their own hardware, and those which have a policy of outsourcing many key systems – the Indian operators, for instance, are particularly keen on the cost predictability and lean capex approach of managed services, and may be considering the next step to the public cloud.
In theory, the system could enable an MNO to acquire spectrum and start offering mobile services in any geography where AWS is accessible, without building a full network. The same could apply to a non-MNO using shared spectrum or an MVNO agreement, or a multinational enterprise wanting to support IoT services, for instance, on a global basis.
Of course, if enterprises do take the bait, it will be a blow to operators’ own attempts to support businesses with telco cloud platforms. However, most of those attempts by MNOs to enter the cloud market have had limited success, and many have backed away from the effort. Even giants like AT&T and Verizon are finding it more productive to form alliances with AWS and others, than to compete with them. AT&T’s partnership with the Amazon-owned behemoth has expanded in recent years, with the two companies effectively carving up the enterprise services between them and cross-selling each other’s offerings.
A more serious challenge to the webscalers’ mobile network ambitions comes from the large vendors. Not only could a major shift to the cloud reduce, over time, the OEMs’ conventional managed services deals, but it could stifle their new cloud-based enterprise services at birth. Nokia, in particular, is targeting enterprises, MVNOs and IoT providers with its Cloud Core and various network-as-a-service offerings. Although it insists the MNO – its key customer – will have a role in such deals, it is clear to see that, in the age of private networks and shared spectrum, the operator might be pushed out altogether.
But of course, the shift to the cloud opens the doors to AWS and Azure too, and while Nokia, Ericsson and Huawei have incumbent advantage with operators, the reverse is true in the enterprise sector.
NEC, as a smaller OEM, can view partnership with a webscaler as an opportunity to grow its business by targeting new customers, rather than a threat. With fewer conflicts of interest than its larger rivals, it can design a cloud-native core for AWS at the earliest stage, whereas it is likely that Nokia and Ericsson will only make that move if the market clearly demands it – and Huawei is not only building cloud core platforms but the cloud hardware, including the processors, itself, seeking to mount a full-stack challenge to webscalers, particularly in China.
NEC says its new solution is based on its existing virtualized mobile core product and can provide enterprises with rapid implementation, and a flexible and secure solution.
Muneyuki Watanabe, director of strategic alliance and channel for AWS Japan, commented: “We believe that high speed, high capacity 5G communications are expected to grow rapidly and that the clouds that support these services will become increasingly important for the various services that meet 5G. By providing secure, highly usable, flexible, low cost AWS services and technical support, such as consulting, we are able to play a part in NEC’s solution development and contribute to 5G businesses in various areas that require high speed networks.”
Toshiya Tsuji, SVP of NEC, added: “In the 5G era, mobile core networks are becoming increasingly important as an industrial foundation, and we believe it will be necessary to swiftly provide networks suitable for a variety of communication data in response to various business needs.”
Another packet core provider, Affirmed Networks, announced that it had implemented its system in the AWS cloud last September, and AWS highlighted this partnership when it started marketing its cloud actively as a platform for operators and other service providers to deploy their core networks.
It wrote, in a white paper on the subject: “Many MNO and MVNOs are already using on-premises versions of [the Affirmed] solution all around the world. This vEPC solution on AWS will enable mobile service providers—MNO, MVNO, and also enterprises who want private LTE—to easily launch versatile and 3GPP-compliant vEPC, with the benefit of opex/capex savings that are automatically available with the pay-as-you-go model of cloud economics.”
The paper makes the broader case for the public cloud core, arguing: “With vEPC on AWS, mobile operators can easily deploy a new core network or can improve their services continuously with the cost and operational benefit of the AWS Cloud. As the telecom industry develops 5G technology, this architecture is likely to become even more relevant, because 5G mobile networks are evolving to include CUPS, stateless architecture, microservices, DevOps principles, and service-based architecture, which all work well with existing AWS services. Hosting vEPC on AWS will enable you to quickly and easily upgrade your 4G network to a 5G network in the near future.”
When it announced its ‘Mobile Network as a Service’ offering, Affirmed’s VP of strategic alliances and systems engineering, Amit Tiwari, said: “This is a very logical extension of the Affirmed NFV platform into a cloud platform, providing … all the things that service providers love about our platform – the automation, the time to deployment, the same levels of reliability. Now apply all of those on AWS. This sort of offering combines all the things we love about the cloud, with the freedom of mobile computing.”
Affirmed was the first significant vendor to disaggregate the different virtual network functions (VNFs) within the EPC so that operators could select different components from different suppliers. And it even claims to have implemented network slicing without 5G.
Gabriel Brown, principal mobile analyst at Heavy Reading, summed up the challenge for operators, saying: “Eventually, network operators of all mobile services are going to have to justify the cost of running their networks against public cloud pricing or public cloud benchmarks.”
Other players are pushing forward with cloud core systems:
As well as the big vendors, there are start-ups specializing in localized and specialized vEPCs, sometimes packaged with a small cell RAN, or even hosted on a small cell. These include the UK’s Quortus and Germany’s CoreDynamics.
Others are taking an early step into cloud cores. Expeto offers an LTE core network on a platform-as-a-service (PaaS) basis. And Athonet, a company being incubated by Orange under the auspices of the Facebook Telecom Infra Project (TIP), boasts of a virtualized mobile core “for centralized or highly distributed edge cloud deployments”, which looks likely to be targeted as a network-as-a-service system.
Then there are open source efforts such as the Open Networking Foundation’s (ONF’s) CORD (Central Office Re-architected as a Datacenter). The CORD community includes service providers such as AT&T, China Unicom, Google, NTT, SK Telecom and Verizon, as well as vendors Ciena, Cisco, Fujitsu, Intel, NEC, Nokia and Samsung.
In 2016, Radisys donated its vEPC to the mobile strand of CORD, which is focusing on three elements – disaggregated and virtualized EPC and RAN, and mobile edge. Last year, Mavenir also contributed a vEPC design and the two vendors demonstrated interoperability – a key MNO requirement to adopt any new architecture, and an important driver for many operators to virtualize at all.