Cloud spending is set to boom in the telecommunication industry, with new research predicting an eventual global investment of over $200 billion to meet surging network demands.
A study from Juniper Research found telco operators will invest $26 billion in cloud services across 2024, a figure increasing year-on-year to a total of $65 billion by 2028.
Expanding data and network demands were cited as the primary cause of this spiraling cloud investment, with Juniper predicting that the expansion of 5G networks and the arrival of “cloud native 6G” networks will cause a 110% increase in cellular data over the forecasted period.
“This growth will be driven by the rising adoption of data-intensive IoT use cases, such as automated manufacturing and vehicle infotainment systems,” the report said.
The report forecasts a bump of 3.7 billion in the total number of 5G connections, with the figure set to increase from 2.2 billion in 2024 to 5.9 billion in 2028, representing a growth of 172%.
Managing this growth in data will necessitate an increasing focus on the cloud to more efficiently deal with network expansion and data-intensive workloads.
The report noted that 52% of cellular data will be serviced by cloud-based systems in 2028. Similarly, this increasing focus on cellular data may begin to drive cost increases as, according to the report, the total cost of ownership in cellular networks are affected by the volume of data traveling over the network.
The report predicted a 177% growth in the total volume of data traveling across operator networks over the next four years, with the implication being that operating costs are at risk of being driven upwards.
This will increasingly push operators towards the adoption of cost-saving technologies such as the “Telecommunications Cloud”, researchers said, which will ensure that operators can more precisely and efficiently distribute network resources.
Telco cloud investment will support sustainability goals
The report noted that this industry-wide focus on cloud investment will pave the way for telco operators to more effectively meet sustainability targets over the next few years.
Despite “improvements” in energy efficiency, the telco industry still accounted for between 2% and 3% of global energy consumption in 2023, according to the report, with energy consumption expected to remain at a similar level in 2024.
Operators can, however, leverage cloud capabilities to drive higher levels of sustainability and efficiency, such as through the utilization of power management systems within cloud environments.
“A key area operators must focus on is the Kubernetes Power Management Operator, which offers power management and energy optimization capabilities for Kubernetes nodes,” the report said.
The report also stressed the importance of machine learning (ML), which promises to automate network management and reduce power consumption in areas of the network according to varying user demand.
“Telecommunications networks are becoming more complex; requiring increasingly automated network management systems,” research author Alex Webb said.
“However, operators must insulate mission-critical traffic when reducing power, to guarantee quality of service for enterprises,” he added.
