Coronavirus, Telecoms, 5G and the Edge: Some thoughts

by Dean Bubley, Disruptive Analysis

The world has changed immensely. The coronavirus pandemic has led to 100,000s of infections and accelerating fatalities. Many countries have imposed shutdowns on businesses and quarantined individuals. The economic fallout will be significant, and potentially long-lasting. 

Communications networks are proving essential to the response by governments, healthcare and public safety, and researchers collaborating on treatments. Work from home is keeping business functioning, while broadband is making quarantines bearable.

As well as huge human, societal and economic costs, there are also long-term ramifications for telecoms, 5G and cloud, and, indirectly, to edge computing. While it seems anathema to think too far ahead now, keeping partial focus on eventual recovery and business is important.

There are many unknowns, and long-range predictions at this stage are fraught with variables and caveats. Nevertheless, it is important for the impacted businesses to put stakes in the ground if only to create strawman scenarios against which to test strategies. 

Current issues

At the time of writing, public fixed and mobile networks are holding up quite well, although there are spikes in broadband use and also mobile voice telephony. Home-working and education has put extra traffic on fixed networks, although mostly in daytime hours rather than the traditional evening peak. 

Mobile network use has grown in some places, but reduced in others – city centres, airports, roads and malls are quiet, while residential use has grown. In some cases, overall mobile traffic has actually fallen, as data usage has shifted to Wi-Fi.

Operators’ technical staff are focused on keeping networks running – especially for public safety and government agencies – with capacity additions and resilience strategies a key focus. Regulators have asked streaming companies to down-rate their video.

Telcos and cloud providers have offered extensions to data-plan allowances, bill payments and subscription packages, especially where unemployment or poverty limits access. Support for business customers has accelerated, with VPNs, conferencing/collaboration tools and security being key focus areas. However, most of these in-market developments are unrelated to either 5G or edge-computing, both of which are at very early phases of deployment and uptake.

Short-to-medium term (1 year) trends & implications

• Some MNOs’ macro 5G deployments will be delayed, because of supply-chain issues, delays to standards and spectrum auctions, staffing limitations, government lockdowns and economic/financial conservatism. There will also be more effort necessarily expended to strengthen 4G networks in the short term. 5G FWA may get a boost in some areas.
  
• 5G delay and economic uncertainty will also likely push back some operators’ enterprise-facing 5G propositions, especially more advanced R16/R17 features such as network-slicing and URLLC offers. This may lead to greater focus on dedicated private enterprise/campus 5G solutions, although most businesses will likely deprioritise and delay trials of private networks as well. 
  
• Some promising sectors for 5G and edge will be particularly impacted by the pandemic and economic downturn, especially retail, travel, hospitality and sports sectors. Others such as smart cities, logistics, IoT in manufacturing, public-safety, utilities and healthcare will be affected less, and should recover once the threat of the virus recedes, although obviously impacted by the new problems the pandemic is creating.
  
• Non-physical tasks such as 5G and edge-network planning, design, training, virtual-event attendance and software development will be continued by people working from home.  

Long-term implications & opportunities for telcos’ & Edge Computing

Various scenarios should be explored around the eventual outcome of the pandemic. It is not possible to make accurate forecasts at this stage but describing possible “future worlds” helps strategists create and test coherent plans.

A central pandemic scenario is “Back to (Almost) Normal” assuming reasonable success at controlling and then vaccinating against the virus, a deep-but-brief global recession with a sharp bounce-back (some sectors faster than others) and more-broadly changed business and government priorities and social behaviours. 

• Businesses will increase efforts around transformation and automation, with more focus on “Just in Case” resilience and cooperation, rather than squeezing every last drop of “Just in Time” efficiency out of the system. This could pull through enterprise cellular networks and edge-computing as expected pre-coronavirus, perhaps with more scope for industry-wide federation or data-sharing for emergencies – which could tip the balance towards “public edge” rather than “private edge”.
  
• Connectivity will be emphasiszed as strategically important and may even be regulated – both locally on-premise/indoors and across wide areas. Governments could impose “stress test” and “adequacy” rules on networks, similar to banks’ financial health metrics after the 2008 crash.
  
• Scaling network capacity and capabilities on a localised basis will drive the need for more distributed and edge-based NFV. Fixed and mobile operators’ planning assumptions for demand peaks may be proven wrong – for instance more need for core-network functions in residential areas rather  than urban cores
  
• Demand for important new local/edge-based applications may grow from government, public safety and health authorities, such as contact tracking surveillance, messaging, video analytics, maintenance of localised quarantines etc.
  
• Over time, sectors such as travel and retail should return to strength, but with new priorities and different structures, tying online and offline experiences more tightly together. It remains to be seen how fast consumer behaviour will switch back to venue-based commerce and entertainment.
  
• New approaches to localised network routing, network-sharing, local breakout and so forth will be developed, for example to temporarily offload or load-balance between multiple MNOs, for emergency services or the public. In peak hours, with emergency-triggered loads, it may be deemed necessary to break out mobile data traffic direct to CDNs, cloud services or the nearest public Internet exchange.
  
• Some cloud-based, organiszationally structured business services would probably benefit from localised connections and service-hosting at the edge. We could see Microsoft Teams, Zoom and other applications running in smaller edge data-centres, perhaps with new “metro” pricing plans or low-latency options for in-region home-workers.
  
• Growing adoption of private 4G & 5G in industrial plants, factories and other sites, reflecting need for flexible processes, physical reconfiguration of equipment etc. Companies that intend to run their own in-house / on-premise edge capabilities, they may look at telco-edge options as a backup for disaster-recovery, or to outsource more of the operation.
  
• New consumer online services and social-networks may emerge around communities and cities, building on the renewed sense of community that seems to be emerging – alongside a continued wariness of large crowds. This localisation of communication (e.g. video-based healthcare, low-latency AR social activities and so on) could well fit with a federated edge-computing environment.
  

Conclusions

Disruptive Analysis sees the post-COVID19 world relying even more heavily on telecoms and networks than in the past. There will be more focus on resilience, and at first perhaps a longer runway for 5G given economic woes, plus a renewed focus on home broadband. In the medium-to-longer term, it should enable a variety of consumer, business and government applications – although with a greater focus on the “serious” aspects rather than entertainment and consumer convenience. 

Edge computing will likely emphasize fixed/Wi-Fi connectivity rather than cellular, in the next couple of years, reflecting both 5G delays and consumers spending more time at home. However, many verticals will continue on, or even accelerate, their transformation trajectories, although with slightly different use-cases. Telcos’ edge-computing focus will endure – perhaps driven more by B2B and government/healthcare use-cases, rather than direct consumer focus.

(This is a moderately-optimistic scenario. More extreme possible scenarios, from dystopian nationalism, to near-utopian societal renaissance can also be explored – contact [email protected] for details)