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Will telcos take the shot at this century’s top opportunity?

HGC insight telco

With 5G starting to be deployed on a mass scale and making data transfers faster than ever before, being closer to the end user is key to create a unique ecosystem to retain the customer on a given platform as long as possible. This is crucial to improve customer experience as well.

Dennis Chan
AVP – OTT , International Business of HGC

Throughout most of the 1900s computing has shifted becoming today an extension of our lives. However, the 21st century is going to be marked by a much deeper form of interaction between us and data. Dennis Chan, AVP – OTT, international Business, at HGC Global Communications, discusses edge computing and how telcos can ensure they survive a new wave of do or die for the sector.

Edge computing is much more than just a game to bring latency down. It is a shift in computing that is fundamentally altering the way we build and scale infrastructure, how we serve a market that is ever more global, and it calls for novelty and cutting-edge thinking in how the ICT industry works as one.

Even before the edge system technology become a hot topic, we were already seeing a lot of internet companies building the now so called “close to the end user platform” – often used as a definition of edge itself, processing power more locally. This is already especially true for gaming companies.

With 5G starting to be deployed on a mass scale and making data transfers faster than ever before, being closer to the end user is key to create a unique ecosystem to retain the customer on a given platform as long as possible. This is crucial to improve customer experience as well.

Even though right now edge still does not have a technical or official definition, we see a lot of attempts to define it with a lot of companies deploying their own edge

On the other hand, edge computing is going to be driven by applications. That is an important part of the puzzle and a significant rewriting of how things are done. The application is always key because two milliseconds or three milliseconds are considered low latency, but if you look at the real deployment of 5G, from the mobile handset to the base station, in reality, we still have about eight milliseconds of data journey times.

What we can clearly see today is that use cases are different and that will be a determining point on the whole edge deployment and evolution of edge itself in the coming years.

For some use cases, such as entertainment or cloud gaming, the urgency of deployment of the edge does not necessarily need to be so extreme compared to other verticals and use cases, for instance, autonomous driving or critical medical requirements.

In the future, edge computing will be built on different scenarios, depending on the use case. We are moving towards a bespoke infrastructure and software world, far from the days when IT was given “little choice” – little based on the opportunities with edge - between hardware and technologies.

Gaming as a disruptor

Cloud gaming is today one of the major motivation drivers for edge deployments. We have seen gaming companies deploying edge computing servers overseas to serve their cloud gaming platforms. This is not an up and coming trend, this is happening right now.

Research house Niko Partners expects 10 of Asia’s top gaming markets - Indonesia, Malaysia, Philippines, Singapore, Thailand, Vietnam, Taiwan, Japan, Korea, and India - to reach 826 million gamers and generate $42 billion in revenue by 2024. When considering China and the Asia-10, these represent more than 50% of the world’s mobile games market revenue, and more than 60% of the world’s PC game revenue. And this is only the Asian segment, there is a whole world out there where today, nearly three billion people are already regular online players.

Online gaming, cloud gaming, Esports, Gaming-as-a-Service, no matter what you call it, is indeed one of the main use cases that driving edge computing, especially with 5G becoming more extensively available. This is in part being driven by a rapid growth when it comes to people using their phones to play.

Another use case that I believe is about to make the business case for edge, is the internet of things (IoT). As a result of the massive smart IoT devices deployment, allied to the fast expanding mobile economy, the amount of data that needs to be processed in the main data centre will overload the systems. And this is obviously not cost effective.

Ultimately, a high level case for the edge is real time human interaction. This will be the key use case to energise edge. If you look at the cases of real time human interaction in gaming, for example, this is crucial to interact with other players and win. This will happen to serve a market where people are willing to pay the money for faster and real time connections.After all, the “as-aService” age is only at the beginning.

Telco’s edge

Obviously, to serve any of the use cases, we can no longer 1) work in silos; 2) wait for demand to hit. Telecommunication companies, data centre providers, hyperscalers and the wider technology and software ecosystem must now join forces and adapt to this new age.

For telcos, in terms of infrastructure, from an edge perspective, they are bound to be the key ingredient for those edge ecosystems. For example, fibre networks and data centre/hosting sites worldwide are two main components to building up edge computing.

When it comes to edge computing, telecommunication companies need to start earlyexpanding the infrastructure covergae before the use cases and full-on demand kick in. We can see these sort of use cases already in some countries, and based on our own experience, it is proven that this model of preparing for demand, works. We cannot wait until the useris in the market looking to make use of our systems. We cannot start behind, so we must, as an industry, get the ball rolling fast.

Additionally, HGC has adopted a consultative approach and we are able to combine our network infrastructure and in-country business intelligence to provide one-stop shop solutions for the gaming industry and start-up businesses, especially for the mobile streaming game segment.

More specifically, we have built a robust portfolio on fine-tuned IP transit routes which allows us to deliver a least-hop, direct local connections that provide ultra-low latency. Such high quality connections are ideal for time-sensitive and location-aware use cases such as online gaming.

HGC, being one of the market leading infrastructure and ICT solution providers in Asia, the all encompassing network coverage with major ISPs, regional MNO, local Internet Exchange and local commercial/residual broadband providers internationally will also allow the company to optimise routing and facilitate service customisation to achieve ultra-low network latency.

On top of it, we also work with customers to understand how we can best serve them on the application layer. Again, fibre and data centres are enablers, but what drives the use case is the application. Overall, I foresee telco companies are evolving more around the workload. The use case they will serve is the answer as to how they will help edge computing itself transform, and to let the market adopt edge as soon as possible before demand outpaces the industry’s capability to cope.

Telco companies are eager to shift their models around the application layer to serve this edge computing century. Only with a vision, the cando approach, solid infrastructure and connectivity, the world can embrace this new technology zeitgeist that is edge computing.

The article was first published on Disruptive Telecoms World Report December 2020 edition.

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