Building or extending telecoms networks is hard work: operators have to buy specialised gear, pull cables and install antennas. But in recent years some have started to “virtualise” their networks, in effect making them easily programmable, just like computing clouds. At its core, this means replacing all the specialised equipment with off-the-shelf machines, with software dictacting its functions. What does this mean for mobile networks?
Although the technology is moving in the direction of virtualisation, some barriers are unlikely to go away: telecoms networks are connected with the physical world. Radio towers cannot be turned into software. Whereas computing capacity is theoretically unlimited, radio spectrum is scarce and hard to use efficiently. And creating physical infrastructure across hundreds of miles is much harder than building big data centres, as Alphabet, Google’s parent company, learned when it tried to quickly wire up millions of American homes.
But “cloudification”, in the lingo, will make it easier to unbundle telecoms networks and then re-bundle them in new ways. Once that happens, a clever entrepreneur could find ways to combine different bits—fibre networks, computing power, unlicensed spectrum—to provide cheap mobile connectivity, at least in urban areas. Start-ups such as FreedomPop and Republic Wireless already offer “Wi-Fi-first” mobile services, which send most calls, texts and data via Wi-Fi hotspots, relegating the conventional cellular network to the status of a back-up. At the very least, the number of “mobile virtual network operators” will grow rapidly: these rent and combine services from other operators to target certain groups of consumers, such as immigrants.
In the longer term, it is conceivable that the industry may be shaken up by the equivalent of Amazon Web Services (AWS), a bank of computers owned by an e-commerce giant that can provide processing power on demand. Call it a “telecoms service”. Such a provider would be able to offer the tricky bits of running mobile networks on demand, allowing start-ups and individuals to run their own mini-networks, scaling them up as needed. A plethora of small or specialised operators would be able to offer competition to the established networks. It would be yet another revolution in communications.