AvidThink

Research and Analysis

AvidThink 2023 August Newsletter

First off, we want to apologize to those subscribers who signed up but have not been receiving our newsletters for the past few months due to a misconfiguration on our end. We are sorry and want to express our appreciation for your patience. This issue has been resolved, and we’ll make sure it doesn’t happen again. BTW, past newsletters are available at AvidThink Newsletter Archives.

Here Comes the Fall (and Travel)

We hope everyone had a good summer and took time for a break. We’re gearing up for a whirlwind of events and travel. Check out AvidThink Events and drop us a line if you plan to attend any of them. We’d love to see you in person!

Meanwhile, we’re looking forward to a host of events, including WasmCon in Bellevue (Seattle) this week (Sep 6-7) to explore the intersection of WebAssembly and the edge. This will be closely followed by TMForum DTW (Sep 19-21, Copenhagen), TMT M&A Forum (Sep 27-28, New York), TIP Fyuz (Oct 9-11, Madrid), OCP Global (Oct 17-19, San Jose), KubeCon (Nov 7-9, Chicago), Edge Computing World (Nov 14-15, Mountain View), AWS re:Invent (Nov 27-30, Las Vegas), and Upperside’s SD-WAN/SASE (Dec 12-13, Paris).

Connected Enterprise 2023

Additionally, we’ve partnered with Capacity Media for their Connected Enterprise show in Chicago on November 7, 2023. Register with code AVID10 for a discount.

Latest Resource Site: SASE/SD-WAN/MCN/ZTNA – Alphabet Soup

If you haven’t yet, check out our latest report and videos on our SASE, SD-WAN, Enterprise Edge, and Cloud Networking Resource Site. We feature videos from Alkira, Cato Networks, Cisco, IBM, Nile, Dell’Oro Group, Orange Business, Apcela, MEF, and Versa. New videos continue to be added.

ICYMI #1: NextGenInfra Sites and Reports

Check out our latest Fiber Connect 2023 showcase from August 21-23 and download our most recent reports. Additionally, many of our earlier reports are now ungated — feel free to download them.

Upcoming reports we’re working on for Fall/Winter include Private Wireless, AI, and Cloud Data Center Networking. You can reach us at [email protected] if interested in sponsoring any of those.

ICYMI #2: Recent Events/Webinars

Here’s a selection of our recent events with links to recordings:

On to August’s news summary!

5G

5G standalone growth stagnates
The number of operators deploying 5G standalone (SA) is relatively unchanged since Q1 at 115 globally per Global Mobile Suppliers Association (GSA). This follows 112 networks at the end of 2022, meaning 3 new networks in 2023 to date. The GSA says more launches are coming as operators test and pilot 5G SA.

AT&T moving slowly on C-band 5G
Analysts at Raymond James believe AT&T is not deploying 5G quickly enough in C-band/3.45GHz spectrum compared to Verizon and T-Mobile. They think AT&T is waiting for 5G revenue opportunities before accelerating deployment, so will continue emphasizing fiber. But ultimately AT&T will need to justify spectrum spend.

T-Mobile uses 5G network slicing for diving event
T-Mobile created a custom 5G SA network slice to enable fast wireless uplink for Red Bull’s broadcast team at a diving event. Uplink speeds reached 276Mbps. The slice ensured broadcast content didn’t impact the experience for ~20k event attendees uploading photos/videos.

Hyperscalers to get 9% of 5G SA workloads by 2027
Dell’Oro Group estimates hyperscale cloud providers will get 9% of 5G SA workloads by 2027, up from 2% in 2022. But 5G SA growth is slower than expected. The 5-year public cloud 5G SA revenue forecast is $5.4B by 2027, 65% CAGR. Slow 5G SA deployment reduces the addressable market for hyperscalers.

T-Mobile’s 5G slicing beta to drive more video use cases
Analysts believe T-Mobile’s 5G network slicing beta for developers will encourage more use cases, particularly video calling. Avi Greengart of Techsponential expects it to enable video communications apps for public safety/government. Roy Chua of AvidThink notes operators in NA/Europe will follow China’s lead, enabling devs via APIs similar to Tencent/China Mobile’s early POCs.

Open RAN

New Open RAN players struggle amid RAN slowdown
Mavenir and Rakuten Symphony are feeling a greater impact of the RAN spending decline than Ericsson/Nokia. Open RAN is expected to be ~7% ($42B) of the $600B RAN market this year per Dell’Oro/Omdia. Rakuten Symphony 1H revenue was down 5% YoY. Mavenir share was down 50% 1H 2022 vs 2021.

Open RAN testing expands in U.S.
The O-RAN Alliance announced 4 new U.S. open RAN test centers, bringing the total globally to 15. The Alliance aims to accelerate testing amid 5G capex cuts.

Rakuten loses key telecom executives
Tareq Amin departed as CEO of Rakuten Mobile and Rakuten Symphony to spend more time with his family. Meanwhile, Sushil Rawat, head of their virtual RAN development, left to direct RAN strategy at Telus.

Open RAN vendor Airspan cuts jobs
Airspan laid off employees in Q2 and expects more job cuts in H2 2023. They took a $3M charge related to a restructuring program. The tech company had hoped to sell open RAN gear to private network and cable operators but is still seeing a slowdown.

Intel, Samsung partner on cloud-native vRAN
Intel and Samsung are integrating 4th Gen Xeon processors/vRAN Boost with Samsung’s vRAN 3.0 software. Samsung aims to accelerate operator migration to the latest silicon and vRAN.

Cloud

Broadcom to invest $2B annually in VMware R&D
Broadcom CEO, Hock Tan, says the acquisition of VMware is on track to close by Oct 31. He intends to invest $2B/year in VMware R&D. VMware will operate independently within Broadcom. VMware is bullish on edge computing, multi-cloud management, and generative AI services.

Cisco teams with Nutanix on hybrid cloud
Cisco is integrating Nutanix Cloud Platform with its SaaS managed infrastructure, to be sold by Cisco. The partnership aims to simplify/automate enterprise IT and is seen as competing with VMware/Red Hat in the enterprise SaaS market. The deal has sparked Cisco-Nutanix acquisition speculation.

Cisco acquires Telenor’s share of WG2 for $150M
Cisco has acquired Telenor’s 44.6% stake in Working Group Two in a deal valued at $150M. WG2 provides a cloud-native mobile core network platform that is used by operators and enterprises for private 5G networks. WG2 customers include Telenor, Kyocera, and Mobi.

Oracle expands hybrid cloud offering
Oracle has debuted single-rack Compute Cloud@Customer for enterprises/telcos wanting Oracle Cloud Infrastructure on-premises. The platform aims to appeal to regulated industries and will run cloud-native and legacy Oracle apps using the same services, APIs, tools as Oracle Cloud.

Enterprise cloud market to double by 2027: GlobalData
GlobalData forecasts the enterprise cloud market will reach nearly $1.4T in 2027, up from $638.6B in 2022. Most large enterprise cloud budgets increased 2022-2023 despite the optimization trend. The public cloud dominates with 60%+ share.

Q2 cloud spending up $10B: Synergy Research
Synergy Research says Q2 cloud revenue increased $10B YoY to $64.8B despite economic pressures. They still expect strong growth. Tier 2 providers like Oracle and MongoDB had the fastest growth but little market share impact. AWS still leads with 32-34% share.

Private Networks

Burns & McDonnell wants to build 5G networks
Engineering firm Burns & McDonnell said in a court filing it wants to buy billions in 800MHz spectrum to build 5G networks for utilities, ISPs and carriers. The firm has already assembled a financing team and is trying to position itself as a credible buyer in the T-Mobile/Dish dispute.

Betacom uses VMware’s private 5G service
Betacom has deployed VMware’s Private Mobile Networks 4G/5G service. This is part of VMware’s 5G-as-a-Service powered by Edge Compute Stack. Betacom aims to reduce the complexity of managing private networks for manufacturing, retail, healthcare.

Federated Wireless scales back private wireless
Despite DoD success, Federated Wireless is cutting investment in private wireless after layoffs. The CEO said they were trying to serve too many industries at once, and that many deployments in the past required highly customized integrations. Federated will focus only on key customers.

Private wireless bright spot for RAN market
Private RAN saw revenue growth in Q2 and is expected to continue per Dell’Oro Group. The Group forecast private RAN revenue CAGR at 24% 2022-2027, while public RAN will decline 2%. 2023 Q2 private RAN equipment revenue was up 60% YoY. They expect $1B cumulative small cell spending by 2027.

AI

VMware tackles responsible AI
VMware sees a need for best practices around biases, privacy in AI and has launched VMware Private AI Foundation with Nvidia to help enterprises run generative AI apps like chatbots. The partnership will provide a platform to run models using Nvidia’s GPU scaling and has named Dell, HPE, and Lenovo as partners.

SK Telecom invests $100M in Anthropic
SK Telecom has invested $100M in Anthropic. They will jointly develop Korean/English/multi-lingual large language models for telcos. In addition, SKTel and Anthropic will work to customize Anthropic’s Claude AI assistant as an industry model for telecoms.

Mobile operators form AI alliance
SK Telecom, Singtel, Deutsche Telekom, Orange have created the Global Telco AI Alliance. They will collaborate on multi-lingual models to strengthen operator AI leadership and avoid ceding strategic businesses as in the past. The group aims to get more operators to join.

AI dominates Google Cloud Next
AI was the focus of the Google Cloud Next opening keynote. Google is touting the rise of AI and its need for vast computation power, driving cloud growth. The company announced Cross Cloud Network and Google Distributed Cloud updates for secure, high-performance connectivity.

SASE/SDWAN

Fortinet enhances SASE platform
Fortinet has added microbranch support, wireless security, data loss prevention, and monitoring to its FortiSASE platform spanning SD-WAN, SASE, ZTNA on FortiOS. Managed via FortiManager.

US Signal adds SASE services
US Signal, a fiber operator in the Midwest, is now offering Cato Networks’ SASE platform for enhancing enterprise customer productivity and efficiency. US Signal was itself acquired by Igneo Infrastructure Partners this year.

Wrapping Up

And it’s a wrap! See you in early October with updates as we go on the road. Finally, don’t forget to download our report on SASE, SD-WAN, MCN, ZTNA — get updated on the latest in enterprise security and networking.

Until next month, wishing you the best!

The AvidThink team