Are you still holding on to your servers? For what? Do you think all the value of your telco is contained in that metal? Well, at the risk of offending you – it isn’t. And you’re wasting a massive amount of money, time and effort on maintaining your private on-premise kit, keeping it running 24/7, protecting it from cyberattacks and careless employees.
You know, the real value of your business lies in your customer relationships and your ability to maximize their potential. It lies in your ability to excite and delight your customers, to engage them, to create strong and lasting relationships and, hopefully over time, increase their spend with you. The value of your telco lies in delivering a more strongly differentiated customer experience than your competitors.
You don’t get value by holding on to management of all of the infrastructure. Twenty years ago you’d be S.O.L., with no alternative BUT to manage the entire tech stack. But today, you’re in luck. With the advent and advancement of the public cloud you can now completely shed millions of dollars of capital expenses and operational headaches, and turn over management of legions of equipment to the providers that can do it better, and more cheaply, than you can: the hyperscalers.
The public cloud is the way forward for practically every industry, yet telcos are way behind the curve. Gartner explored the TCO of migration to cloud over three years and found that by the end of year three, total costs dropped by 55%. Why wouldn’t you make the move? Below are four reasons to change.
1. The hyperscalers have invested billions of dollars building their clouds.
Public cloud is the result of billions of investment. Google has invested more than $40 billion to date and is expected to invest more than $10 billion into offices and datacenters in the U.S. in 2020.
And the great thing about all that investment – you get access to all of it! By moving to the public cloud you can use all that power to play with the latest technology, to build and break new applications, to invent, to get new features and functionality out to your customers at lightning speed.
2. The hyperscalers are building their own chips – and they’re vastly cheaper and faster than the ones you can buy on the ground.
If you’re like most organizations, chances are your datacenter stack has been built on Intel x86 chips. But in the public cloud, you can build a stack based on the new AMD Graviton2 chips. AnandTech benchmarked these chips against the older Intel chips available at AWS. The findings: 40% savings and a 7x performance improvement. It was so dramatic they called it the “x86 Massacre” – because with these kinds of results, Intel is TOAST. How do you plan to compete with your Intel-based datacenter on the ground when your competitors have access to AWS’ cheaper, faster, better compute capabilities?
3. The hyperscalers didn’t just focus on hardware – they focused on software.
Ten to 15 years ago telcos laid their bets on their datacenters and built out compute and storage via their own clouds to sell to their customers. Verizon, for instance, once had 29 datacenters across 15 markets, including jewel-in-the-crown NAP, a 750,000-square foot site in Miami. The portfolio was bought by Equinix in 2017 as part of a $3.6 billion tech deal. . Around the same time that the telcos were building, the hyperscalers also started with their public clouds. One of them thought it was all about the hardware – not software – while the other ones invested in building out the software.
It’s software that’s been the difference, and it’s what has led to the hyperscalers crushing the telcos in cloud. It wasn’t about hardware management – it was building the software that mattered. Databases, container systems, analytics, ML, AI – this has been the reason why the hyperscalers have won. The telcos never stood a chance.
4. If those reasons aren’t enough, there’s one more: FOMO.
Some telcos are already beginning to build relationships with the public cloud providers. Telefónica, Vodafone and Orange have partnered with Google; AT&T has announced it’s working with Microsoft; Deutsche Telekom with AWS. For now, it’s a trickle. It will soon be a flood. The entire industry is finally beginning to wake up to the benefits. Be one of those early movers before your competitors leap ahead of you. If you’re already considering dropping the private metal and looking to the public cloud, do it! If you’re not considering it, you should be – because others are and they will gain the resources and flexibility to be better than you. Check out my guide, which sets out all the reasons why telcos should move to the public cloud and blows up misperceived negatives. We’ve set out the four key steps you need to take to begin the transformation and create the catalyst for your journey from private to public. Take a look – then contact me and let’s talk about how I can help
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