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The impact of telco cloud transformation and hybrid network management on CSPs’ operations

Dana Cooperson Research Director
Stela Bokun Principal and Head of Custom Research, Consulting

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This report analyses the changes that network virtualisation will demand of communications service providers’ (CSPs’) operations so that virtual and hybrid next-generation networks (vNGN) can be properly operated and maintained to meet CSPs' business objectives for service innovation in the digital economy.

The report also examines the possible impact of telco cloud transformation — specifically from network function virtualisation (NFV) and software-defined networking (SDN) — on the lifecycle of CSPs’ operations.

Analysys Mason expects that most CSPs will implement the NFV/SDN telco cloud transformation in three distinct phases: virtualisation, orchestration and cloud-native.

Most of the changes to CSPs’ operations will occur in the orchestration phase, which typically starts in year 2 of the transformation and will probably last more than 5 years.

Many benefits that CSPs expect to reap from their telco cloud transformations will only fully materialise in phase 3

We believe that CSPs will probably experience years of operational challenges that are more complex than those they are facing today before they enter phase 3 of the transformation. Only in phase 3 will CSPs reap the benefits of the digital future in terms of better service agility, support for an expanded set of digital services and better cost structures.

CSPs must expect that it may become much worse before it gets better when going through telco cloud transformation

Overall, the impact of telco cloud transformation on CSPs' operations will be significant but not immediate and its scope and nature will vary according to CSP and country. Furthermore, not all elements of CSPs’ network virtualisation operations lifecycle will be affected equally and at the same time.

In this report, we focus specifically on the impact of telco cloud transformation on service creation, order management, procurement and purchasing, provisioning and acceptance testing, troubleshooting and maintenance.

We focus on the changes that will happen in the orchestration phase, while CSPs are running hybrid networks, because the extent of these changes will be the greatest.