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Omdia view

Will operators’ network software investments stall because of COVID-19? It’s likely, particularly as they scramble to ensure networks can handle the shift in networking traffic as the world logs online from home. Remote worker video conferencing will certainly increase network traffic, but the larger network constraints will come from HD video content access and online gaming as families hunker down together during this pandemic.

As new COVID-19 cases start to slow and select businesses, offices, schools, and public spaces slowly begin to re-open, we expect operators will still have to support growing data traffic and adjust to new ways of working that will be permanent going into 5G.

Omdia believes operators cannot lose sight of the long-term need for network virtualization, with NFV as one of the key building blocks. A cloud-native network infrastructure that supports containerized network function, edge compute, network slicing, and E2E orchestration is going to be fundamental to compete in 5G. So, NFV and other carrier software investments should continue. What will operators prioritize this year? Omdia ran a survey in 2H19 asking operators about NFV adoption plans over the 12 months. Recognizing that the amount of planned investment will change due to COVID-19 and its impact on the telecom industry, we do believe priorities will remain in line.

Understandably, security is at the top of the list. SD-WAN is up there, too. SD-WAN remains one of the more successful use cases for operators to sell to enterprises, because enterprises understand the benefits of this network function (i.e., efficient traffic steering, lower costs, and real control of and visibility into the application).

While further down the list, operators’ interest in IoT management is worth pointing out. 5G is supposed to drive IoT services so putting management services into place now makes sense. However, the industry is going to have to see how COVID-19 impacts telecom as whole. At that point, we can better assess how far behind, if at all, operators will be in current investment plans.

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