Cloudy, with a chance of XaaS

By Dudy Cohen 7 min read

Cloud architecture and services have changed your customers’ technological and business environments, whether they are SOHO, SMBs, or large enterprises. These changes pose challenges for any service provider architecture, but also hold unique opportunities for those who adapt and expand their technology and business model to match these new times.

While Cloud and Anything as a Service (XaaS) are more recent buzzwords, they have existed as concepts and trends for a few decades.

The scale-skills gap

The main rationale behind moving from an on-premise to an off-premise application is the scale-skills gap. In order to maintain an ever-changing technology infrastructure to support an organization’s needs, the organization needs to establish, maintain and evolve its Information and Communications Technology (ICT) infrastructure. This task requires scale, as entry-level hardware for modern ICT infrastructure becomes expensive as technology evolves. This task also requires skills in order to maintain those software Reach systems and support the business continuity of the organization.

The scale-skills gap usually grows in smaller organizations. This is the reason that smaller organizations were the first to adopt early cloud-based services such as IP-Centrex, which became popular in the late 1990s. These services replaced the organization’s Private Automatic Branch Exchange (PABX) and eliminated the need for a local PABX. Instead, they were used to provide services from a virtual PABX at the service provider’s premise, to end devices (predominantly IP-Phones or analog phones connected to telephone adapters).

Over the years, as customers’ businesses become more and more dependent on ICT, the drive towards cloud-based services became more dominant. More and more functions within an organization’s ICT infrastructure have been replaced by cloud-based alternatives. This includes business-supporting software such as Customer Resource Management (CRM) and Enterprise Resource Planning (ERP), communications infrastructures such as mail and web servers, networking and security functions, and other software and hardware functions.

Offloading to external service providers

The result of this move is dramatic for any organization. Small organizations are relieved of the burden of maintaining and updating different ICT infrastructure elements, while larger organizations benefit from the easy establishment and evolution of their infrastructure across multiple branches.

This allows an organization to focus its resources on its core business while offloading ICT overheads in terms of hardware, software, and staff to an external entity. The external entity also benefits from this move since it creates a much more intimate relationship with its customer, bringing greater opportunities for service providers.

Such providers, who until now provided basic pipelines like Internet and T1-PRI telephony connections or basic data connectivity between branches, can move up the food chain and provide many cloud-based services (XaaS). While larger organizations will be inclined to acquire cloud services from global players like AWS or Microsoft, in Over the Top (OTT) models  – where the cloud-based service provider is not the connectivity provider – smaller organizations will appreciate a one-stop-shop offer from their connectivity providers.

Compromise is not an option

This huge opportunity for service providers does come at a price. The connectivity they provide to their customers becomes a critical part of their customers’ business support infrastructure.

In on-premises infrastructures, service degradation or service failure in the connectivity infrastructure results in minor interferences in the organization’s business since critical services are still available internally. However, moving to the cloud realm changes this completely as any interference in connectivity immediately results in a major interruption in all cloud-based services – and can halt the organization’s business completely.

For this reason, a compromise to business continuity is not an option. When organizations move to cloud-based, off-premises services, their availability and reliability requirements do not become laxer – on the contrary, they become more stringent. Such a move typically involves more ICT involvement in the organization’s business processes and more dependency on this infrastructure.

Moreover, availability and reliability are not the only requirements that need to be tightened. Capacity, security, and latency have also become major issues. Capacity requirements have increased significantly to accommodate the traffic that was previously local in an on-premises scenario. The security concerns of an organization sending its most confidential data to the cloud must be relieved, and latency must be held to a minimum to enable the same quality of experience for end-users as in an on-premises solution.

So, how should service providers approach the cloudy revolution that their customers are undergoing?

First –it should be seen as an opportunity to seize. Service providers can now offer existing and potential customers a much more attractive, intimate, and sticky service-bundle, and step out of the “dumb-pipe” provider domain into a much more lucrative cloud-based services (XaaS) provider realm.

Second – the infrastructure that enables these services in terms of connectivity must be accommodated to the new requirements. Access, aggregation, and core networks must evolve to support higher capacity for each customer, as well as higher security, reliability, availability, and lower latency.

These requirements are very similar to evolving requirements existing in other domains such as 5G services, Internet of things (IoT), and mission-critical applications. This is fortunate since technologies and applications developed for one domain can also easily serve other domains.

Applications such as ultra high-capacity wireless transport and fiber redundancy combined with Software Defined Networking (SDN) and Network Function Virtualization (NFV) are applicable for all domains and are available to service providers wishing to evolve their infrastructure into the cloud era.

Evolving your network to 4.5G and 5G is easier with multicore everywhere, to learn more:

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