Amazon enters European 5G market with O2 Telefónica cloud deal

O2 Telefónica in Germany, in partnership with Nokia, has made a groundbreaking move by deploying 5G standalone core software on Amazon Web Services (AWS). This marks a significant milestone as it is the first instance of an existing mobile operator shifting its core network to a public cloud. 

Traditionally, telecom networks have migrated IT and other non-core operations to the cloud, but this transition by the subsidiary of the Spanish group Telefonica sets a new global precedent.

Expanding horizons: Amazon, 5G, and cloud integration in Telecom

Big cloud computing giants like Amazon and Microsoft have been eyeing the telecom sector for lucrative potential revenue, despite some operators’ reservations about the public cloud’s ability to manage a mobile network effectively. 

The core network, which is crucial for securely routing data and calls at high speeds, typically relies on high-performance servers in data centres. Transitioning to a public cloud can reduce costs, enhance scalability, and facilitate maintenance without disrupting service.

Recently, the trend towards cloud migration in telecom has been gaining momentum. For instance, earlier this year, NTT DOCOMO, Japan’s leading mobile operator, announced plans to deploy its nationwide 5G Open Radio Access Network (RAN) in collaboration with AWS. Back in 2021, AWS also partnered with DISH to expand its 5G network throughout the U.S. It’s interesting that Telefonica initially collaborated with AWS and Ericsson before switching to Nokia and AWS for its operations.

The deployment of Nokia’s technology offers O2 Telefónica ultra-low latency, essential for delivering advanced 5G services such as extended reality and network slicing, which demand instantaneous availability and more substantial bandwidth capacity. Nokia’s secure and cloud-native 5G core architecture enhances O2 Telefónica’s network by allowing more flexible scaling, increased reliability, and near zero-touch automation for managing workloads.

This move also showcases Nokia’s capability to transition communication service providers (CSPs) to various cloud platforms, including public, private, and hybrid clouds. This flexibility enables CSPs to deploy applications and services on the infrastructure that best meets their needs. Nokia is a leader in 5G standalone core technology, serving 107 CSP customers worldwide and was recently recognised as an industry leader by GlobalData.

Mallik Rao, chief technology & information officer at O2 Telefónica, highlighted the strategic nature of this deployment. “With the new 5G cloud core, we are moving away from traditional architectures and instead focusing on modern, high-performance, and efficient network technologies.

“By partnering with Nokia and AWS, we ensure our customers enjoy a superb 5G experience along with new digital applications.”

Fabio Cerone, GM of Telecom EMEA at Amazon Web Services, shared his enthusiasm about AWS’s role in this transformative project. “By using Nokia 5G Core network on AWS, O2 Telefónica is redefining its operating model through full automation and elasticity at scale. It will bring O2 Telefónica the ability to dynamically scale and allocate 5G network capabilities to meet customer needs, as well as the needs of the new applications that will run on top of the new core,” he said.

Raghav Sahgal, president of Cloud and Network Services at Nokia, also expressed his support for O2 Telefónica Germany’s innovative step onto AWS.

He sated: “This deployment, the first major one of its kind for an existing communication service provider, enables greater network agility and service offerings, and provides Telefónica Germany with all the tools it needs to efficiently manage and extract greater value from its network assets.”

A growing market for telecom cloud

As the global telecom cloud market is poised to grow from US$19.7 billion in 2021 to an estimated US$108.7 billion by 2030, companies like Amazon stand to benefit significantly from this expansion. This shift highlights the evolving dynamics in the telecom industry, where cloud technology plays an increasingly central role in network management and service delivery.

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Tags: 5G, AWS, cloud, networking, Nokia, Public Cloud