HPE Trying to Make Pay-To-Play 5G the Next Big Thing
As the major players in telecommunications and silicon seek to stake out there claims in the coming 5G gold rush, Hewlett Packard Enterprises is embracing a consumption-based 5G services model that it expects will allow customers to enjoy the benefits of 5G without having to invest significant capital into networking infrastructure, the company recently announced. HPE plans on including all of its 5G-related products and services in HPE Greenlake, its cloud-based pay-as-you-go service by 2021. HPE sees a consumption-based service as a viable alternative to customers who don’t have the resources to upgrade their existing network for 5G capabilities.
“Not a lot of people know the full extent of what we do [in telecoms],” Phillip Mottram, HPE’s Head of Communications and Media Solutions, told TechRadar.com. “Previous generations of standards were built for the network equipment providers (NEPs) like Ericsson, Huawei and Nokia, and they positioned [each new generation] as an upgrade to operators. When it came to 5G, operators realized it was an opportunity to break the stranglehold of the NEPs and make standards more open. The idea was you could mix and match from different suppliers. HPE can give you a viable alternative to what you can get from the NEPs and pre-package it for you and charge it on a consumption basis.”
HPE also announced the debut of the HPE 5G Core Stack, a cloud-based core network model the company anticipates will help support commercial use cases that require the faster speeds and lower latencies that edge computing can provide, specifically edge deployments like virtualized radio access networks (vRANs) and multi-access edge computing (MEC) applications. HPE expects that the Core Stack when used in conjunction with the company’s Aruba networking portfolio will allow customers to prioritize certain kinds of traffic, a method called network splicing. HPE boasts that there are 16.5 million Aruba hotspots worldwide, which will enable customers to offload traffic onto local networks and free up bandwidth.
HPE is bullish on the potential benefits of a pay-to-play 5G service for its customers, but what is the value of a consumption-based 5G operability for the provider? Although HPE doesn’t need to take a backseat to anyone in the technology department, the big NEPs like Nokia, Ericsson and Huawei have essentially cornered the market on networking hardware and radio base stations. By offering their products as a consumption-based service, HPE can provide a viable and more cost-effective alternative to a range of customers that the NEPs aren’t well positioned to support, potentially engaging an untapped customer base. HPE could also experiment with bandwidth pricing, perhaps even by instituting surge pricing practices like Uber implements on Friday and Saturday nights or Enron used during the energy crisis of the early 00s.
Speaking of Enron, the value of bandwidth might rise so high that Greenlake and similar services start trading it like a commodity, the way Enron traded electricity and other energy resources. If a company investing in 5G networking hardware is the equivalent of a family investing in solar panels for their home to lessen their reliance on the electrical grid, then consumption-based services would fill the role of the utility company. The capital investment might pay for itself in the long run, but if you can’t afford to make that kind of investment, HPE has a potential solution. Whether it proves beneficial to the company or its customers remains to be seen, but don’t be surprised to see similar services start popping up as 5G continues taking the world by storm.