Telcos eying $170b cloud services market

Asia Cloud Forum editors
21 Mar 2012

Cloud computing will be a source of new revenues and differentiation for telecom operators, according to Ericsson's industry discussion paper The Telecom Cloud Opportunity.

An increasing number of telecom operators are already recognizing this opportunity as evidenced by their morphing strategies and growing investments. Ericsson projects that global investments in cloud services will more than double from an estimated $55 billion in 2011 to almost $170 billion by 2015. Operators are poised to take a significant share.

The largely untapped cloud service opportunity will substantially differentiate telco operators from sector competitors and other cloud providers. The exponential growth of mobile technology supports this cloud opportunity both in the enterprise and consumer space.

An Ericsson business user study found that 78% of the respondents say they work more efficiently when they have access to mobile broadband and 92% say they need access to mobile broadband everywhere.

The Ericsson paper identifies three areas of opportunity for operators to shift from selling communications to servicing on-demand ICT capabilities. Telecom operators can add considerable value in the management of cloud connectivity, deliver cloud-based capabilities and leverage network assets to enrich cloud offerings.

"Telecom operators can move beyond simply being the conduit for over-the-top (OTT) players and position themselves to capitalize on cloud services - both as providers and adopters of the technology," said Warren Chaisatien, Ericsson Strategic Marketing Manager.

One example is for telecom operators to offer prioritized or guaranteed services - instead of best effort - on selected OTT cloud applications. In the enterprise space, telecom operators can not only benefit from the use of cloud services to gain efficiencies in their internal operations but also partner with cloud providers to commercialize those applications.

This opens up new opportunities in traditional markets such as outsourced billing, as well as emerging segments like cloud-based machine-to-machine platforms for vertical industries.

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