Verizon thinks it’s out front in what it calls an enterprise “land grab” at the edge. Of course, everyone likes to say they’re in the lead of some race or another, and Verizon’s position in the edge is really set by a deal with Microsoft and Amazon. Does this mean that they’re just resellers and not in the lead at all, or that maybe there are factors in establishing leadership that we’ve not yet considered?
One thing that jumps out in the article is the references to Mobile (or Multi-Access) Edge Computing or MEC, versus the more general concept of edge computing. The article blurs the distinction a bit, quoting an investor transcript where Verizon’s CEO says “We are the pioneer and the only one in the world so far where we launch mobile edge compute, where we bring processing and compute to the edge of the network for new use cases.” That implies a more general edge mission. However, the same transcript quotes the Verizon CEO saying “First of all is the 5G adoption, which is everything from the mobility case, consumers and business and then fixed wireless access on 5G.” This seems to focus everything on 5G and even private 5G.
There’s some hope that other parts of the transcript could bring some clarity to the picture. Verizon also said that “We have Amazon and Microsoft being part of that offering. They are a little bit different. One is for the public mobile edge compute and one is for the private mobile edge compute.” That’s hardly an easy statement to decode, but let’s give it a go, based on Verizon’s website and previous press releases.
“Public” and “private” MEC here refer both to whether public or private 5G is used and to whether the cloud-provider-supplied MEC hosting is linked with Verizon’s actual service edge, or whether it’s hosted on the customer premises. The Amazon Wavelength offering is integrated at the Verizon edge (the public mobile edge), and the Microsoft Azure relationship uses Verizon’s 5G Edge to support a private RAN (LTE or 5G) and host Azure components on the customer’s premises (the private mobile edge).
In both cases, the goal of MEC is to introduce a processing point to latency-sensitive applications that sits close to the point of event origination, rather than deep inside the Internet/cloud. Where there’s a concentration of IoT devices in a single facility, having MEC hosted there makes a lot of sense. Where the IoT elements are distributed or where the user doesn’t have the literacy/staff to maintain MEC on premises, a cloud option might be better.
Supporting both, and with different cloud partnerships, seems aimed more at creating cloud provider relationships than about actually driving user adoption. Most users would likely prefer a single model, and of course either of Verizon’s MEC options could (with some assistance, likely) be made to work either as cloud services or as a premises extension of the cloud. That’s not really made clear, which seems to cede the responsibility for creating real users, real applications, to somebody else.
One interesting point the article and transcript make is that Verizon is saying it doesn’t expect to see meaningful revenue from edge services until next year. Add to that the fact that Verizon’s CEO says they’ve “created” the market and you have to wonder whether there’s a lot of wishful thinking going on here. The biggest wish, obviously, is that somebody actually builds an application that can drive the process, make the business case for MEC and itself. Who would that be? There are three broad options.
Option one is that the enterprises build their own applications and host them on Verizon’s MEC solution. Verizon’s material suggests that this is the preferred path, but since the material is web collateral it’s possible that the preference is just a bias toward the kind of organization who’d likely be looking for MEC offerings rather than IoT applications. Verizon’s role in this is valuable to the extent that it has some account control among these prospective buyers.
Option two is that public cloud providers would build their own applications and offer them as a part of Verizon’s MEC. This option could be more populist; smaller users without their own IoT development capability could easily adopt a third-party service. However, it could be a complicated option to realize because the cloud providers already have edge computing strategies and application tools, and Verizon is unlikely to have great influence in smaller firms to justify their taking a piece of the action. The ability to integrate with Verizon’s network (the Amazon Wavelength variant) could demonstrate a clear Verizon benefit, though.
This is the option that Verizon seems to be pursuing, at least as far as what they’ve told Wall Street. At the Goldman Sachs Communicopia event, they indicated that they were getting traction from enterprises on private 5G and were working with the cloud providers on edge computing applications. I can’t validate either from my own contacts with enterprises, but it does seem that the public cloud deals option would be the one most likely to bear fruit in the near term.
The final choice would be that third-party developers would use the Verizon MEC service. This would empower users of all kinds if it could be made to work, but it’s difficult to see how Verizon would be able to create a good program. Their IoT developer program was focused on pure IoT connectivity, and Verizon doesn’t have any particularly credible account relationship with the software/application side of enterprise CIO organizations.
If we assume that the most certain path to business success is to own your target market, it’s hard to see how Verizon’s “land grab” grabs any useful land under any of these three options. What seems to be on the table is simply a commission on selling cloud services someone else creates. It’s not that the options aren’t viable application pathways, as much as that they’re not particularly centered on Verizon and would be difficult to realign without considerable Verizon effort. Effort, sad to say, that’s not likely to be forthcoming. If we stay with the “land grab” analogy here, what Verizon seems to have grabbed is the cornfield in the Field of Dreams.
