Cloud technology and services are important to businesses and consumers in multiple sectors of the economy worldwide.  In telecommunications, modern networks are increasingly deploying cloud-based solutions in multiple settings across networks, operational functions, and customer facing business support, including cloud native 5G networks. We have been commissioned by BEREC (Body of European Regulators for Electronic Communications) to develop a study on the “cloudification”[1] and “virtualisation”[2] of telecom networks and services. The objectives were to report on the technical evolutions of this trend, on the market and business dynamics behind, and to identify potential impacts on competition and regulation. Besides desk research, conducting more than 20 interviews under Chatham House rules enabled us to assess our initial findings against the experiences and expertise of stakeholders, to get their real-world insights, and help disentangle hype from reality. The report examines the technical and market trends of cloudification of telecom networks and services. It does not identify any current market failures in the provision of networks and services resulting from these developments, but details several risks and areas for further study and monitoring.

[1] Cloudification is the hosting of data and compute in data centres. In electronic communications, cloudification has enabled virtualised network functions to be hosted in this way.

[2] Virtualization allows network functions and resources to be delivered independent of hardware as virtual networks.

Full report available here