Backed by the Cloud, Telcos Are Realizing Serious Gains

Amid Europe’s digital transformation, here’s how the cloud is propelling telcos to optimize networks, reduce costs, boost sustainability and resiliency, and power innovative services.

The Digital Decade , the European Commission’s vision for Europe’s digital transformation by 2030, gives Europe the opportunity to gain leadership in the global digital economy, but achieving it requires collaboration across the entire digital ecosystem. The stakes are high: according to Unlocking Europe’s Digital Potential , a report from UK-based policy and research consultancy Public First, the Digital Decade could unlock over 2.8 trillion euros in gross value added (GVA), equivalent to nearly 21% of the current EU economy.

Cloud computing will play a vital role in delivering the ambitious agenda – in fact, the same study found that 55% of the estimated GVA gain is reliant on the cloud. However, there is still much to be done to reach the Digital Decade’s goals for cloud-computing adoption; the European Commission has set a target of 75% of European businesses using cloud services by 2030, nearly triple the 26% adoption rate today.

One important sector in achieving the goals of the Digital Decade is telecommunications. According to a recent Omdia study, 52% of telcos said cloud providers represent their most important digital transformation partnerships.

Amazon Web Services (Amazon Web Services) is deeply committed to helping the telecommunications sector achieve the benefits of The Digital Decade. Amazon Web Services has invested, and continues to invest, billions of euros into Europe’s digital infrastructure. Hundreds of thousands of organisations of all sizes and across all industries, including telcos, and the public sector, use Amazon Web Services infrastructure to provide services to European citizens, businesses, and government bodies.

In addition to investments in infrastructure, Amazon Web Services works with telcos globally, including European leaders such as BT , Deutsche Telekom , Orange , Swisscom , Telefónica , Telia , and Telenor . By working with Amazon Web Services, telcos across the world are reducing OPEX, unlocking new growth opportunities, helping to increase sustainability, and enhancing resiliency – all whilst benefiting from the most flexible and secure cloud-computing environment available today. Here’s how:

Reducing OPEX by Migrating Operations to the Cloud

Telcos want to simplify their operations by transforming their IT infrastructure and increasing automation across their business processes. Amazon Web Services works with telcos to decrease the complexity of their enterprise IT and network overloads by migrating to the cloud. Amazon Web Services helps telcos accelerate this transition by eliminating the need to run their own data centers and by rapidly migrating workloads to optimize performance, lower cost, and free up capital they need to stay competitive and innovative.

This approach clearly pays off. Shifting operations to the cloud promises to reduce telco OPEX/revenue ratios by more than 10%. In fact, according to Omdia , the typical brownfield operator could see OPEX as a percentage of revenue for network operations drop from 18.4% to 13.5%, and those associated with IT operations decrease from 6.2% to 3.5%. The study found that even moderate cloud adoption across key telco domains will drive down OPEX as a percent of revenue, from 57% in 2022 to 46% in 2030.

Increasing Sustainability and Energy Efficiency

Amazon Web Services is working to help telcos become more sustainable and empower their end customers to reduce emissions. A study by global research firm 451 Research found that European businesses can reduce their energy use by almost 80% by moving their compute workloads out of on-premises data centers to Amazon Web Services. The report also found that migrating compute workloads to Amazon Web Services across Europe could decrease greenhouse gas emissions equal to the footprint of millions of households. The research indicated that companies could potentially further reduce carbon emissions from an average workload, by up to 96%, once Amazon Web Services meets our goal to be powered by 100% renewable energy, a target the company is on a path to achieve by 2025.

DOCOMO and NEC Corporation (NEC) announced late last year that a trial to test energy efficiency and high performance of Amazon Web Services Graviton2 processors across key elements of their 5G core network demonstrated an average 72% reduction in power consumption. And Amazon Web Services has just announced a new Radio Access Network (RAN) Intelligent Control (RIC) solution, built with Juniper , Aira Technologies and VIAVI Solutions . The RAN, the part of the network that connects individual devices, accounts for 75% of a telco’s energy consumption . This new solution uses machine learning (ML) to better measure and identify which RAN bands can be shut down based on predicted traffic trends and is estimated to improve energy efficiency up to 20%.

Enhancing Resiliency

In Europe, Amazon Web Services has deployed eight Regions, each with multiple fully isolated Availability Zones (AZ). An AZ is a group of logical data centers, each with redundant power and network connectivity, within an Amazon Web Services Region. AZs are completely independent and physically separated from each other by many kilometers. Every AZ and Amazon Web Services Region is interconnected via low-latency private network infrastructure joined via trans-oceanic cables. The network is built on a fully redundant 400 GbE fiber network backbone. AZs give customers the ability to operate production applications and databases that are more highly available, fault tolerant, and scalable than would be possible from a single data center. If an application is partitioned across AZs, customers are better isolated and protected from issues such as power outages, lightning strikes, tornadoes, earthquakes, and more. Through the use of AZs and data replication, Amazon Web Services customers can achieve extremely short recovery time and recovery point objectives, as well as the highest levels of service availability.

Because telco networks are susceptible to service outages resulting from events such as network equipment failure or natural disasters, Amazon Web Services works with customers to leverage its infrastructure to help enhance resiliency of their network service – without having to invest in building costly back-up networks. For example, in Japan, DOCOMO has implemented a copy of their primary network in the Amazon Web Services cloud that acts as a backup for network traffic when the primary network is impacted. In the event of an earthquake, for example, NTT Docomo can run offload traffic from the primary network to the backup network in the Amazon Web Services cloud within minutes. Similarly, Swisscom is currently trialing a hybrid cloud approach for a resilient network, where the Amazon Web Services cloud has a redundant copy of their on-prem network. Part of that infrastructure includes Amazon Web Services AZs, as previously described.

Unlocking the Potential of 5G (and Beyond) Through the Cloud

Unlocking the full potential of 5G to drive innovation across industries and realize new revenue will require not just 5G connectivity, but transformative connected services that deliver artificial intelligence, ML, and the Internet of Things to customers. Amazon Web Services is working with telcos to help them transform from telco to ‘tech-co’ with upskilling and collaboration to help telcos be the ones to deliver these services and unlock new revenue.

For example, Sweden-based Telia announced last May an upskilling initiative with Amazon Web Services to train 10% of its staff on Amazon Web Services cloud technologies. And less than a year later, Telia built and deployed a machine-learning solution for its customer, Finnish logistics company Transval. Or take the work we’re doing with Canada-based TELUS to create a new vendor-agnostic smart home solution that will reduce the need for multiple smart home apps, simplify the installation process for home owners, and enable new multi-device automation. Or, finally, look at our Integrated Private Wireless program , which brings together Amazon Web Services services and infrastructure with telco 5G networks to simplify the process for enterprise customers to discover, deploy, and operate private wireless networks.

Telcos have a big part to play in the Digital Decade, and the cloud is vital to them making the difference for their customers. We are at a moment of massive transformation for the industry, and are excited to continue to work with our telco customers and partners to help them innovate, unlock new growth, and enhance the value they deliver to their customers.