5G Networks Bring Cloud Computing to the Edge, Enabling New Service Development and Delivery

C. Drake

Summary Bullets:

  • New partnership initiatives involving AT&T, Microsoft, Verizon, and Amazon Web Services highlight the extent to which 5G and edge computing innovations are starting to take shape.
  • Initiatives aim to combine cloud resources with 5G network infrastructure in physical locations close to where low-latency and high-performance apps will be developed and consumed.

Two important announcements from the past couple of weeks illustrate how quickly 5G and edge computing may be starting to become a reality.

First, AT&T and Microsoft announced an initiative that will see Microsoft make its Azure-branded cloud services available within so-called ‘edge locations’ on AT&T’s newly deployed 5G network. This will ensure that Microsoft’s cloud infrastructure can be used to support the development and delivery of new digital services at locations that are geographically closer to consumer and business devices, including Internet of Things (IoT) endpoints. Traditionally that infrastructure had to be accessed from one of Microsoft’s regionally distributed cloud data centers. However, making Microsoft’s cloud infrastructure available at the edge of 5G networks means that data generated by IoT sensors can be processed at higher speeds and new services like autonomous cars, virtual reality (VR) and augmented reality (AR)-enabled immersive experiences, and cloud-based gaming can be offered with higher levels of performance.

Just days after the AT&T-Microsoft announcement, Verizon and Amazon Web Services (AWS) unveiled plans to introduce a new 5G edge computing architecture that will allow AWS developers to build digital applications by accessing AWS compute and storage services at the edge of Verizon’s 5G network. Verizon will host the new AWS Wavelength platform, which will provide the tools and resources to help developers create applications requiring ultra-low latency, close to the places where those applications will be consumed.

The AT&T-Microsoft initiative and the one announced by Verizon and AWS are similar, in that they aim to combine cloud resources (infrastructure and services) with newly deployed 5G network infrastructure and position those resources close to places where low-latency and high-performance apps will be developed and consumed. However, both initiatives are also still at the pilot stage and are available only to a limited number of select customers and within limited geographies – Dallas in the case of AT&T-Microsoft and Chicago in the case of Verizon-AWS. AWS has a similar partnership initiative in Europe with Vodafone, which is also hosting AWS Wavelength at the edge of its 5G network to support new service innovation. It too, however, is currently limited in scope and will focus on the UK and Germany.

It is therefore still early days to assess the wider market and competitive impact of these initiatives. 5G rollouts just began in 2019, and it will take several years for coverage to reach par with 4G LTE networks. Furthermore, the long-term success of these initiatives will depend partly on the sort of new digital services and applications they go on to enable. Success will also depend on the business and pricing models that accompany new content and service innovations. Meanwhile, unforeseen technical, commercial, and even regulatory hurdles could result in slower than envisaged deployment and development timeframes. 2020 is likely to bring further progress with 5G and edge computing, but expect that progress to be gradual and not without its challenges.

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