What’s up with… Telco GPUaaS, HPE, SES

• Telcos to generate billions from GPUaaS – ABI Research
• HPE appeases activist investor with strategy committee
• SES completes €3.1bn acquisition of Intelsat

In today’s industry news roundup: Telcos are well placed to reap billions of dollars in new revenues from GPU-as-a-service offerings, according to a new report; HPE has formed a new strategy committee as part of an agreement with activist investment firm Elliott; satellite giant SES has completed its acquisition of Intelsat and is ready to explore new markets; and much more!

As telecom operators across the globe invest in so-called AI factories (datacentre facilities dedicated to AI workloads), a growing number of them are launching GPU-as-a-service (GPUaaS) offerings, a trend that will lead to new revenue streams for many, according to ABI Research. The analyst firm has published a new forecast that suggests telcos are on course to generate more than $21bn in revenues from their GPUaaS offerings by 2030. This revenue increase will be driven “by the continued growth in demand for GPU compute by enterprises and the growing requirement of AI sovereignty by governments,” according to the research firm. Larbi Belkhit, industry analyst at ABI Research, noted: “While the telco GPUaaS market is still at an incredibly early stage, there is significant momentum behind the buildout of AI factories and upgrading existing datacentre portfolios to better support AI workloads. Demand for access to GPU compute continues to grow, but alongside that is a growing necessity for AI sovereignty and telcos are extremely well positioned to be the preferred and trusted partner for national or regional AI inferencing workloads,” added Belkhit. 

HPE has struck a “cooperation agreement” with activist investor Elliott Investment Management – which has built up a stake in the company reportedly valued at $1.5bn – that has resulted in the formation of a new board-level strategy committee and the appointment to the vendor’s board of Bob Calderoni. HPE describes Calderoni as “a veteran technology executive and current chairman of KLA Corp,” a company that produces systems for chip fabrication plants. Calderoni, who has previously worked at companies such as Citrix and SAP, is to head up the new strategy committee, which “will assess the strategies of HPE’s businesses and identify opportunities for additional value creation,” the vendor noted in this announcement. The move comes only two weeks after HPE completed the $14bn acquisition of Juniper Networks.  Calderoni will also join HPE’s integration committee, which was formed by the vendor’s board following the closing of the Juniper transaction. HPE’s chair, former Lucent Technologies CEO Pat Russo, stated: “We are pleased to welcome Bob to our board. His perspectives and experiences will complement those of our existing directors, and I look forward to collaborating closely with him as we work together to drive increasing value for our shareholders. HPE has an exciting opportunity ahead given the recent close of the Juniper Networks acquisition, and Bob has directly relevant experience that will be invaluable to us. The board is focused on providing management with the support and engagement necessary to successfully integrate this acquisition, which will strengthen HPE’s value to both customers and shareholders.” Jason Genrich, Elliott partner and senior portfolio manager, stated: “We appreciate the positive dialogue we have had with HPE’s board and see substantial value ahead. We believe Bob’s appointment to the board and his leadership of the new strategy committee will help HPE identify meaningful operational and strategic opportunities for shareholder value creation. We are pleased with today’s outcome and look forward to continuing our collaboration with the board and the management team to support HPE’s ongoing transformation.” That positive dialogue also includes Elliott being able to nominate a new member of the HPE board. HPE’s share price is up by 1.6% today to $20.68, giving the company a market valuation of almost $27.5bn.

As expected, Luxembourg-based SES has completed the acquisition of fellow satellite operator Intelsat for $3.1bn. First announced in April 2024, the deal creates “a strengthened global satellite operator with an expanded fleet of 120 satellites across two orbits,” noted SES in this announcement. “With a world-class network including approximately 90 geostationary (GEO), nearly 30 medium earth orbit (MEO) satellites, strategic access to low-earth orbit (LEO) satellites, and an extensive ground network, SES can now deliver connectivity solutions utilising complementary spectrum bands including C-, Ku-, Ka-, Military Ka-, X-band, and ultra-high frequency,” it added. The expanded SES has combined annual revenues of €3.7bn, adjusted earnings before interest, taxes, depreciation and amortisation (EBITDA) of €1.8bn, and “a combined contract backlog exceeding €8bn, providing clear visibility into future revenue streams.” The satellite operator plans to invest between €600 and €650m in its constellation each year in the 2025-28 period (excluding its commitments to Europe’s Iris2 programme). These investments “will enable the company to continuously strengthen its network and explore emerging growth markets including internet of things (IoT), direct-to-device communications, inter-satellite data relay, space situational awareness, and quantum-key distribution,” noted the company. “Today, we’re not just merging two companies – we’re creating a stronger company, built for the future,” stated SES’s CEO Adel Al-Saleh. “In this new chapter, we are bringing together a powerful mix of talented people, network infrastructure, spectrum, innovation and global relationships that will allow us to deliver next-generation connectivity and space-enabled services in smarter and quicker ways.” The new SES senior leadership team can be found here.

AT&T says it has achieved “nationwide coverage” for its deployment of 5G reduced capability (RedCap), the version of 5G that is well suited to internet of things (IoT) deployments, and that its 5G RedCap service now reaches 200 million potential customers. AT&T said in this blog that its “nationwide RedCap network brings 5G to the next generation of devices that have less battery consumption, lower costs, and lower bandwidth requirements. Our RedCap network will serve devices spanning from wearables and XR [extended reality] glasses, to a broad range of IoT products for healthcare, asset tracking, industrial sensors, fleet management and other mid-speed computing devices.” The US operator noted it has certified the Franklin Wireless RG350 mobile hotspot as the first commercially approved 5G RedCap product on its nationwide network. The device “combines 5G with the efficiency and simplicity of RedCap technology in a compact and user-friendly form-factor – offering our customers a great mobile experience, whether they’re working remotely, travelling or just need a dependable internet source on the go.”

Quinas Technology, a company spun out from the University of Lancaster, UK, is one of the winners of the latest WIPO (World Intellectual Property Organisation) Global Awards, the university has announced. The WIPO Awards recognise startups and small and medium-sized enterprises (SMEs) that use intellectual property (IP) as a driver for innovation, business growth and positive social impact. Picked out from 780 applicant organisations from 95 countries, Quinas Technology is recognised for its work in “reshaping the future of computer memory with its patented Ultraram ‘dual-use’ technology, which combines the speed of DRAM and the non-volatility of flash memory in a single device. This breakthrough enables faster, more energy-efficient computing with many applications across datacentres, mobile devices, and AI hardware.” Ultraram is particularly significant because it exploits “quantum resonant tunnelling”. The new technology was developed at Lancaster University by a research group led by professor of Physics, Manus Hayne. He also holds the post of chief scientific officer at Quinas Technology. He commented, “With the use of quantum resonant tunnelling as the key inventive step behind Ultraram, it is particularly fitting in the UN International Year of Quantum. The award represents international recognition of the insight, creativity and hard work from colleagues at Quinas and in the physics department and commercialisation team at Lancaster University.” As a winner, Quinas will benefit from a tailored support package that includes strategic mentoring, global visibility, and access to WIPO’s international network of IP and business partners. Ultraram’s target applications will include AI, quantum computing, space and defence technologies. The project also accords with the UK government’s semiconductor strategy which is to boost domestic innovation and build sovereign capabilities in key semiconductor technologies. To date Quinas has now secured five granted patents across four jurisdictions, with eight more pending. Together they form “a strong foundation for its IP-led commercialisation strategy.” In quantum mechanics, particles can exhibit wave-like behaviour, which means there is a “non-zero probability” that a particle will penetrate a potential barrier, even if its energy is less than the barrier’s height. This is quantum tunnelling. Quantum resonant tunnelling occurs when a particle’s energy matches a specific energy level within a potential ‘well’ formed between two barriers. Such an alignment increases the tunnelling probability and resonant tunnelling is a key factor in the development of advanced electronic devices, such as resonant tunnelling diodes (RTDs). These are semiconductor devices with a quantum well structure that exhibits a unique property called ‘negative differential resistance’ (NDR). In NDR, increasing the applied voltage can lead to a decrease in the current and such characteristics have great potential for high-speed electronics. Quantum resonant tunnelling is a consequence of quantum confinement, where electrons are restricted to a small region, leading to discrete energy levels. In essence, quantum resonant tunnelling demonstrates the counterintuitive behaviour of quantum mechanics, where particles can pass through barriers at specific energies due to wave interference. This strange quantum effect (yes, another one!) has important implications for the development of totally new electronic devices. 

– The staff, TelecomTV