INDUSTRY SURVEY 2025
Cloud and Edge
The move to standalone 5G is under way. Maybe not as fast as expected. But it’s coming. Indeed, 5G connections are expected to represent 51 percent of mobile connections by 2029, making 5G the dominant connectivity ‘generation’. This transition is bringing with it new thinking about network infrastructure. Why? Because 5G SA virtualises many network functions, which decouples services from physical hardware.
In plainer language, 5G SA lets MNOs turn many of their core functions into software – and host them on the cloud. This opens up the possibility of considerable savings. MNOs can avoid the vendor lock-in that comes with physical components. They can buy computational resources from different suppliers. And they can use open source, rather than proprietary, components and replace them without overhauling the system.
While there are many advantages to cloud computing, tXQhere are obvious downsides too. Cloud computing relies on huge centralised data centres, often located far from the user. This can slow down data transfer rates and increase the risk of damaging cyber attacks.
These factors have fuelled the growing interest in a more local approach. Edge computing moves data processing closer to the source of data generation. This eliminates the need to send data back and forth over long distances, reducing latency. It also improves security by isolating edge data and limiting its exposure to the public network.
Of course, the main reason why edge is attracting so much interest among MNOs is commercial. Edge computing gives enterprise customers faster and more reliable connectivity, which better supports data-hungry applications such as HD video streaming, teleheath, drones, smart factories and others. It can also better manage the massive volumes of data generated by IoT devices.
Moreover, virtualised 5G SA lets operators carve their network into discrete local slices. This means enterprises can launch their own private networks tailored to their own use cases with pre-set performance, quality, traffic routing, latency and security requirements.
And one final benefit of cloud computing: it offers MNOs the ability to become vendors of consumer cloud services themselves. The last decade has seen an explosion in cloud offerings – for storing photos, videos, documents and more. As existing OTT providers abandon their freemium models, MNOs are well positioned to offer trusted, in-country alternatives that drive both customer loyalty and revenue.
White-label solutions provide a cost-effective way for operators to launch branded cloud services without heavy infrastructure investments, offering seamless bundling opportunities that enhance retention and ARPU.
Analysts believe the transition to cloud and edge is inevitable. IDC forecasts that spending on edge computing alone will climb from $228 billion in 2024 and hit nearly $378 billion by 2028. While much of this investment will be enterprise-focused, edge computing will also enable enhanced consumer experiences, including faster content sync, lower-latency media access, and improved security by keeping cloud storage closer to the end user.
ReThink projects that edge computing-related revenues in telecoms will rise from $3.29 billion in 2023 to $29 billion by 2031. However, these revenues will form just part of a much wider push by MNOs into the enterprise space. A 2024 report by GSMA Intelligence highlighted an addressable market of more than $400 billion for telcos looking to grow revenues in B2B markets. This equates to approximately 35 percent of all mobile operator revenues worldwide.
The numbers are mouth-watering. Yet there are plenty of challenges to overcome. Despite its rapid development, edge computing still lacks consensus on standardised definitions, network architecture and protocols. Then there’s the value chain question. Edge computing is a fragmented landscape comprising MNOs, network equipment vendors, service providers and hyperscalers. No single participant can offer a true end-to-end offering or service. MNOs must decide to what extent they partner with giant hyperscalers that could, in other contexts, become competitors.
How should MNOs accelerate their 5G and Edge capabilities?
In-house? Outsource? A combination of both? It’s the eternal question for any 21st century business with big infrastructure investments to make. It certainly applies to MNOs in the cloud/edge era. Our survey found that only a minority believes it can go it alone. Just 15 per cent chose ‘in-house investment in cloud infrastructure’. 27 per cent favour partnerships with hyperscalers. The top choice by far is a hybrid of in-house and partnerships at 44 percent.
Which 5G and Edge uses cases present the greatest growth opportunities?
The impact of AI on all areas of telecoms is hard to underestimate. It’s certainly evident in this survey question. Here, 53 percent of respondents selected ‘AI-driven real-time insights and predictive analytics’ as the top route to growth in 5G and edge. B2B applications also figure prominently. A combined 69 percent believe IoT and enterprise/SMB will drive growth. In the consumer space, 14 percent say there’s an opportunity for MNOs to create personal cloud products.
Do you currently offer branded consumer cloud services to your subscribers?
MNOs have historically crafted ‘value added services’ that are distinct from the core telco trio of voice, messaging and data. Personal cloud products offer a new opportunity. Our survey suggests a sizeable proportion of operators are interested. 17 percent already offer own-brand services, while 15 percent offer them through a white label partner. 23 percent are assessing the opportunity. However, 30 percent have no plans.
What are the biggest challenges for MNOs when monetising consumer cloud services?
The market is growing, and consumers are looking for alternatives to the incumbents. So what’s stopping MNOs from monetising consumer cloud? The cost of investment is holding back 41 percent, just ahead of competition from hyperscalers (39 percent) and lack of differentiation compared to hyperscalers (37 percent).
How significant is data sovereignty and in-country cloud storage for your consumers?
Consumer cloud services offer a revenue opportunity for MNOs. But there are dangers. As regulators impose more rules around data privacy, service providers must take steps to avoid breaches. Consumers are becoming more privacy-aware too. In our research 74 percent of respondents describe data sovereignty and in-country cloud storage as critical or important. Just three percent say it’s minimal.
What role does bundling cloud services play in driving revenue and reducing churn?
Bundling is a time-honoured tactic in the telecoms space. Cloud services are the newest add-ons. Do they work? The survey is pretty emphatic. 52 percent say they drive moderate revenue and churn reduction. For 27 percent, it’s high. 21 percent believe the bundling of cloud products has minimal or no impact.
This article first appeared as part of Mobile World Live’s Industry Survey 2025 Report, which surveyed 300 global industry respondents, on topics across eSIM, AI, Satellite and Cloud.