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Sourced by TelecomTV's TRACKER platform
from ABI Research Media Releases

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Despite billion-dollar investments, webscale giants still can’t conquer last-mile connectivity

Via ABI Research Media Releases

Oct 10, 2017

Singapore - 10 Oct 2017

Following their success in disrupting the IT and internet industry, webscale giants have identified Last Mile network connectivity as the next frontier. ABI Research estimates that nearly US$2.5 billion was invested in 2016 by webscale giants in their attempts to revolutionize Last Mile network connectivity. However, this is a relatively small figure when compared to the US$400 billion spent by fixed and mobile network operators in their capital expenditure globally.

Since 2016, the level of activities by webscale giants have picked up considerably. Previously Google was operating Google Fiber and Project Loon. The internet giant has since acquired Webpass, providing the company a wireless approach to deliver multi-gigabit broadband services. At the same time, Facebook demonstrates its solar-powered drone for rural network coverage, while Space X and OneWeb aim to fully bypass existing operators by offering telecommunication services via low-earth orbit satellites.

“On one hand, these activities are a timely reminder for operators not to stay complacent as all industries have been proven to be prone to disruption, even those with heavy regulations,” said Lian Jye Su, Senior Analyst at ABI Research. “But on the other, we would like to question the rationale behind such decision, given the huge disparity between the capital investment between both sides. While the internet giants come up with innovative approaches, none of the approaches are financially sustainable or scalable at the moment.”

ABI Research believes the Goldilocks principle should be applied moving forward. Instead of trying to come up with a fresh approach, webscale giants can collaborate with operators to develop more innovative solutions that are sustainable and commercially viable. The launch of Telecom Infra Project (TIP) by Facebook is a good example. Facebook invests in its own wireless technologies, such as massive MIMO, millimeter wave antenna system and low power radio access network (RAN) reference design. Among them, Facebook also open sources its RAN reference design, OpenCellular, to the vendor community.

“The elephant in the room is obviously the spectrum and infrastructure resources owned by the incumbents, such as base-stations, poles, and trenches,” concludes Su. “While the arrival of 5G opens up more options for network deployment, the existing resources offer advantages difficult to be ignored and act as a high barrier to entry. Collaboration is the way forward.”

These findings are from ABI Research’s Last Mile Network Activities by Webscale Giants report. This report is part of the company’s Mobile Network Infrastructure research service, which includes research, data, and analyst insights.

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This content extract was originally sourced from an external website (ABI Research Media Releases) and is the copyright of the external website owner. TelecomTV is not responsible for the content of external websites. Legal Notices

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