Most CSPs in developed countries will widely deploy 5G networks by mid-2020s

According to Technology Business Research, Inc.’s (TBR) 5G Telecom Market Forecast 2018-2023, an increasing number of CSPs globally, predominantly in developed countries, are accelerating and broadening the scope of their 5G build-outs, which prompted TBR to increase its 5G infrastructure market size forecast compared to 5G Telecom Market Forecast 2017-2022. There are a few reasons for this pull forward, including the need for CSPs to stay competitive for customers of traditional mobile broadband and high-speed internet services, reduce the cost-per-gigabyte of carrying traffic (network opex efficiencies), and build a foundation in preparation for new use cases of the network. The availability of 5G devices, including a variety of smartphones, in 2019 is another key driver prompting earlier infrastructure investment.

The software upgradeability of some newer LTE base stations will enable some CSPs to more quickly and seamlessly migrate to 5G. However, nearly all CSPs will need to deploy net-new 5G base stations and 5G mobile core over time as CSPs transition from a Non-Standalone (NSA) to Standalone 5G architecture. This seamless software upgradability of new RAN platforms to 5G will facilitate deployment at incremental cost, keeping overall 5G capex spend scaling quickly but at a relatively lower level compared to prior RAN generation upgrades.

Mobile broadband (MBB) and fixed wireless access (FWA) will be the two predominant use cases for 5G technology by CSPs through the forecast period, with other use cases materializing in the middle to later years of the forecast period, mostly as it pertains to machine-type communications such as massive IoT or mission-critical IoT.

Now. Next. Beyond.: EY’s road map for moving from current to future

TBR perspective

Norman Lonergan, EY global vice chair, Advisory, opened the EY 2019 Global Analyst Summit with an outline for a new strategy called Now. Next. Beyond. Having executed extremely well against its earlier strategy, EY needed to raise its own bar. In a way, it is adhering to a strategy that it likewise seeks to use to assist its key clients in adopting and leveraging technology to enter the digital economy as a stronger and more vibrant operating business.

Achieving these objectives does not happen overnight, nor will it occur without false starts and shelved proof of concept trials. From TBR’s perspective, Now. Next. Beyond. broadly translates into the following:

  • Now: The point in time where the heavy advisory lifting takes place to establish the foundational business rules required for further automation on the way to becoming a truly digital business.
  • Next: Obtainment of the low-hanging fruit in quick operational enhancements to cut costs (and prove value) and to enhance the overall customer experience. This phase likewise lays the foundation with anchor ecosystem participants to harden the automated or smart contract pieces necessary for the network effect at scale.
  • Beyond: The aspirational objective that in some ways could be entirely different business models made possible through atypical partnerships with business entrants from radically different business domains.

The EY construct is not necessarily groundbreaking or unique, but it is the strategic framework and corporate language the firm intends to deploy as it moves forward in the industry evangelizing its best practices and promoting the tight working relationships it has built over the past decade with enterprise technology stalwarts such as Microsoft and SAP.

Appropriately, EY hosted its annual Global Analyst Summit at a working cruise terminal at the water’s edge of Boston’s Seaport District, in a facility that served as an EY innovation hub before turning back into the assembly area for an oceangoing cruise ship. The venture-forth vibe in the physical facility amplified the sentiments expressed by EY’s leaders, particularly around making the firm more global, including global engineering across service lines and developing IP in a more industrialized way. As one EY professional explained, “When we solve a problem through applying tech, and thus creating an asset or tool, we want to productize and commercialize and globalize.” Like a ship making course corrections while still navigating toward a desired destination, EY has adjusted its business model, folded asset-based consulting and managed services into traditional consulting, and committed to emerging technology.

Cyber liability insurance: Modern security apparatus for modern security threats

Cyber liability insurance: Leveraging an old concept for modern challenges

Despite modern security challenges, there are modern solutions emerging to help customers navigate security risks, reduce risk for enterprises, generate better security hygiene, and perhaps even foster stronger standard bodies. One solution is taking an old concept, insurance, and modifying it for the data age.

Insurance is a concept that has existed since the Babylonians built the hanging gardens, and likely in some form before that. Insurance generally exists in a love-hate relationship with those that are covered. However, it is often deemed essential (or made essential through law) to cover the many what-ifs of life.

We discussed in the prior section several ongoing security challenges related to liability and business risks that are causing customers to reconsider pursuing digital transformation. However, what if customers’ digital footprints were insured? What if damages from a breach were paid through an insurance company, or if an expert recovery team was funded through a policy that would be dispatched as soon as there was an incident? And what if such a policy included damage control and positive marketing services following a breach? This would make customers much more comfortable by mitigating part of the risk associated with taking the technological leap toward digital transformation.

This is not an “aha” moment. Cyber liability insurance already exists on the market. It is defined by the International Risk Management Institute Inc. as:

 A type of insurance designed to cover consumers of technology services or products. More specifically, the policies are intended to cover a variety of both liability and property losses that may result when a business engages in various electronic activities, such as selling on the Internet or collecting data within its internal electronic network.

Most notably, but not exclusively, cyber and privacy policies cover a business’ liability for a data breach in which the firm’s customers’ personal information, such as Social Security or credit card numbers, is exposed or stolen by a hacker or other criminal who has gained access to the firm’s electronic network. The policies cover a variety of expenses associated with data breaches, including: notification costs, credit monitoring, costs to defend claims by state regulators, fines and penalties, and loss resulting from identity theft.

Companies such as Nationwide and Hiscox, among a long list of others, provide it. However, it is hardly brought up in the digital transformation discussion, and TBR believes it has important market impacts as well as drives opportunities for current security vendors. In terms of the market, TBR believes the more mature cyber liability insurance becomes, the faster organizations will adopt digital transformation. It would be beneficial if cyber liability insurance were part of the conversation when a vendor leads a digital transformation implementation, just as car insurance must be a consideration when buying a new car.

TBR Weekly Preview: May 6-10

We are still cranking through our initial analysis of vendors’ earnings for the first quarter, with more detailed analysis available two weeks after the announcements.  


  • Growth of Wipro IT Services’ (ITS) emerging business lines, such as Digital Ops and Platforms, shows recent investments are paying dividends; however, steep declines in its legacy outsourcing business are offsetting gains. Though Wipro ITS is moving in the right direction, it will require a more aggressive acquisition agenda to compete with peers. — Kelly Lesiczka, Analyst, Professional Services Team 


  • In TBR’s 1Q19 IBM Initial Response, we discussed the waning IBM Z product cycle and its effect across IBM’s businesses. In TBR’s full report on IBM, we will unpack some of the company’s strategies that were announced at IBM THINK 2019 as well as explore the impact of IBM’s quantum computing breakthroughs on its strategy and business performance.
    Stephanie Long, Analyst, Data Center Team
  • Despite experiencing pockets of growth, such as in consulting and cloud, IBM Services’ revenue continued to decline in 1Q19. IBM Services’ struggles to balance market demand with stakeholders’ expectations and the company’s relentless emphasis on improving profitability via productivity, such as implementing new ways of working and infusing automation and AI into processes, overshadowed any revenue growth. IBM has the incumbent advantage, which has been built on the company’s portfolio breadth, global scale and years of execution, making it one of the most trusted technology brands for large enterprises. However, IBM Services will continue to experience fierce competition from peers, such as Accenture, which is using its industry and functional expertise to expand client mindshare, particularly as it invests in talent development and intellectual property and shifts its value proposition to becoming a technology-enabled solutions broker. — Elitsa Bakalova, Senior Analyst, Professional Services Team


  • TBR’s 1Q19 Sprint Initial Response will examine why the proposed T-Mobile merger is in Sprint’s best interests, as Sprint’s long-term survival as a stand-alone company is threatened by the company’s weak financial position, subpar network quality and struggle to attract customers apart from utilizing aggressive pricing tactics. — Steve Vachon, Analyst, Telecom Team
  • Ericsson is successfully executing its strategies on multiple fronts, as demonstrated by the company’s organic sales growth and improvements in gross and operating margins in 1Q19. Its U.S.-centric 5G strategy has enabled the company to secure large-scale contracts with the country’s Tier 1 operators, as well as with U.S. Cellular, for 5G-ready RAN and LTE densification, and Ericsson will be able to sustain revenue growth throughout 2019 as these contracts ramp. Increasingly optimized headcount and the restructuring or exiting of unprofitable Managed Services and Digital Services contracts are benefiting margins.


  • Execution of T-Systems’ transformation plan, combined with increased client adoption in emerging areas, will help the company capture sustainable growth. During 1Q19 T-Systems expanded its presence in Europe to increase its work with its existing clients, leveraging its portfolio investments. — Kelly Lesiczka, Analyst, Professional Services Team 
  • Mode 2 and Mode 3 services and solutions transition HCL Technologies’ (HCLT) portfolio into newer areas and help extract additional wallet share from clients. Additionally, HCLT pursued investments in 1Q19 to develop niche portfolio offerings, such as within the digital marking services space, to help differentiate from its India-centric peers. — Kelly Lesiczka, Analyst, Professional Services Team 


  • Integrating Capgemini’s established management consulting expertise with digital design and creative studios, as well as with the broader capabilities across its portfolio, will enable the company to provide holistic, consulting-led offerings and approach clients with a business transformation value proposition. — Elitsa Bakalova, Senior Analyst, Professional Services Team

Three years after launching Google One, Google Cloud nears enterprise readiness with Anthos

Google Cloud’s enterprise journey started with Diane Greene and the ‘One Google’ strategy

When Google entered the public cloud market it leveraged the company’s positive reputation among developers as well as technological expertise around machine learning and data analytics from its Search business. However, as a cloud vendor, the company had yet to establish a reputation or a business model that appealed to enterprises. Customer engagements were largely disjointed as G Suite and Google Cloud Platform were sold by different sales teams, making it cumbersome for enterprises to adopt multiple offerings within Google Cloud’s portfolio. To attract and win enterprise customers, Google Cloud hired Diane Greene as CEO in 2015 and created its “One Google” enterprise strategy in which Google Cloud planned to unify its SaaS and PaaS offerings in sales and engineering. Greene’s experience as the co-founder of VMware made her particularly qualified to lead the new strategy, but she was unable to establish the business messaging that large enterprises seek. However, Google Cloud’s value proposition to enterprises has improved over the past three years under Greene’s leadership with a degree of portfolio integration and technology advancement in areas such as machine learning, analytics and Kubernetes.

Incremental improvements are the backbone of Google Cloud’s enterprise-grade platform, Anthos

Over the past year Google Cloud’s momentum has continued to accelerate: Thomas Kurian was appointed CEO, the company partnered with large vendors such as Atos and introduced Google Cloud Services platform, which included hybrid capabilities with Google Cloud’s GKE and its new managed on-premise private cloud, GKE On-Prem. While many of these developments were noteworthy on their own, Google Cloud’s Anthos Platform, announced at Google Next in April, brings together the vendor’s technological advancements and partnerships, as well as new capabilities and infrastructure agnosticism that truly appeals to enterprises.

At its core, Anthos is a rebrand of Google Cloud Services Platform, a multicloud management toolset first announced in July 2018. In addition to GKE On-Prem’s general availability through Anthos, Google Cloud also launched Anthos Migrate, which enables customers to manage workloads running on Amazon Web Services (AWS) and Microsoft Azure. Anthos Migrate automates the migration of virtual machines from on-premises or cloud environments into containers in GKE, which helps simplify migration to Anthos.

The ability to migrate from — or run workloads on — AWS and Microsoft IaaS in addition to Google Cloud Platform (GCP) is vital to Google Cloud’s enterprise strategy, as 30% of enterprises plan to increase the number of IaaS providers in their hybrid environments over the next two years, according to TBR’s 2H18 Cloud Infrastructure & Platforms Customer Research. Further, enabling these organizations to containerize legacy applications on premises in Anthos helps alleviate virtual machine maintenance and OS patching pain points for enterprise IT departments. Migrating to Anthos also enables customers to leverage offerings such as Google Cloud AI in GCP while keeping certain workloads on premises, which is particularly beneficial for organizations facing corporate, government or industry regulations.

Google Cloud’s partner ecosystem will support, sell and augment Anthos to drive customer adoption

Because Anthos is a completely software suite, customers can deploy it on their existing hardware rather than replacing on-premises assets with new infrastructure. For customers that have existing hardware or plan to buy additional infrastructure, Google Cloud hardware partners such as Cisco, and hyperconverged infrastructure partners including Dell EMC, Hewlett Packard Enterprise, Intel and Lenovo are making their offerings compatible with Anthos, enabling customers to configure or purchase the underlying hardware based on their storage, memory and performance requirements.

System integrators including Accenture, Atos, Cognizant, Deloitte, HCL Technologies, NTT DATA, Tata Consultancy Services and Wipro are also developing services and solutions to provide managed services for Anthos, helping Google Cloud customers integrate Anthos into their hybrid environments. TBR expects these partners will drive adoption of Anthos, as they bring Anthos to market and sell the suite to their customer bases, helping expand Google Cloud’s addressable market.

IBM’s Kubernetes-based IBM Cloud Private offers a similar value proposition, but Google Cloud’s expertise in Kubernetes may help fend off competition from IBM, as well as Microsoft and AWS

Google Cloud’s most formidable competitor regarding Anthos is IBM and its Kubernetes-based PaaS offering IBM Cloud Private, which is gaining traction in the market as evidenced by the vendor’s 200 customer signings in 4Q18. Additionally, IBM’s tenure as a trusted enterprise provider makes the vendor a favorable choice for many organizations. However, IBM is also seen by many enterprises as a legacy on-premises provider, whereas Google Cloud is a born-in-the-cloud business with a strictly cloud-oriented business model. In the public cloud market, Google Cloud is growing at a faster rate than IBM, showcasing Google Cloud’s superior perception in the market. In addition to its improving perception among large enterprises, Google Cloud can leverage its reputation among developers to outcompete IBM in the small- to medium-enterprise space.

AWS’ Amazon Elastic Container Service for Kubernetes and Microsoft’s Azure Kubernetes Service are Kubernetes-based PaaS offerings similar to GKE, but the on-premises capabilities for each offering lag behind those of Anthos. Azure AKS will become available on Azure Stack, but the plans to create Azure AKS on Azure Stack were just announced in February. Amazon EKS can connect to Kubernetes apps running on premises, but the capabilities are more limited than those of Anthos as AWS has not yet developed an Amazon EKS on AWS Outposts. TBR expects Google Cloud will be able to fend off competition from IBM, AWS and Microsoft, as Google Cloud — as the inventor of the technology and with a network of more than 20 ISV partners with Kubernetes apps in the GCP Marketplace — has a prowess that may help swing customers in its favor.

VAR partners may not survive cloud boom: TBR

“According to practice manager and principal analyst Allan Krans, companies that do make the change will form the largest segment of cloud partners, while those that don’t will ultimately not survive.

“However, the new breed of partner, such as those working with companies like Amazon Web Services (AWS) and Salesforce, will need to operate in a fundamentally different manner compared with traditional partner models from the likes of Microsoft, Intel and Cisco, Krans stressed.

“’Rather than traditional IT vendors relying on partners to drive their business, in cloud those partners are on their own in many respects to identify and develop their own value-add,’” he explained.

“’Being creative, developing intellectual property and focusing on the gaps between multi-vendor solutions are much more important activities for partners in cloud programs compared with traditional ones.’”

VMware Cloud on Dell EMC bridges on-premises infrastructure

“They will be in a complex dance to get their respective customer’s compute, storage and networking needs met,” said Ezra Gottheil, principal analyst at Technology Business Research Inc. “I think VMware has the inside track with their abstraction of the cloud over AWS’ because VMware’s abstraction doesn’t lock you into just one cloud provider.”

Do not concern yourself with quantum supremacy; the opportunity is in ‘economic advantage’

Economic advantage is a key, repeatable milestone for quantum computing

TBR defines “economic advantage” as the point at which there is a significant benefit, either in time to insight or the ability to obtain an insight, that makes it cost-effective to pursue a given problem with the help of quantum computing. This does not mean that the benefit needs to be achieved exclusively with a quantum computer. In fact, TBR believes that initial economic advantage will be achieved by disaggregating a complex problem from classical computing to quantum computing and then back to a classical computer to maximize the cost efficiencies of gaining a given insight. Just as quantum computing will hit the market algorithm by algorithm, so will economic advantage.

It is not necessary for quantum computing to reign supreme across the IT space in order for value to be abstracted from the technology. It is also not necessary for quantum computing to take the place of a classical computer in order to provide value. This is a key factor that many vendors in the market are overlooking. Just as cloud is not all or nothing, neither is quantum computing. Cloud, as it currently exists, works in partnership with on-premises environments. In fact, customers prefer the consumption of cloud in this hybrid manner. This is a similar consumption-type model we foresee quantum computing taking, in which classical computing and quantum computing work together to fully harness the power of quantum computing.

As the prevalence of quantum computing continues to increase in the IT realm, there are many different views on the technology. Some believe the technology is so far from being relevant that it is not worth worrying about. Others believe the technology is already here, while still others believe the technology is on our doorstep and the wealth of knowledge it will release for society is almost upon us. Here is one thing we all can agree on: Quantum computing has not achieved quantum supremacy. However, TBR believes there is a far more important metric to concern ourselves with as a society that is much closer than we think: economic advantage.

Technological complexity could become a major impediment to realizing the promise and potential of 5G

TBR perspective

The 5G ecosystem remains in a pressure cooker. There is pressure on standards bodies and their constituencies, including vendors, operators, enterprises and governments, to rush forward with technology development and hurry infrastructure into the field. There is also pressure on these same stakeholders to figure out how to not only get that gear into the field at scale but how to monetize this new infrastructure.

Though the 5G bandwagon has remained cohesive thus far, increasing technological complexity could become a major impediment to realizing the promise and potential of 5G. Additionally, increased influence by enterprises and governments is adding more complexity to the fold.

It will likely take another year for the dust to settle on the specifications for 5G NR and the 5G core, two foundational technologies for 5G networks. A key takeaway from the 5G Summit is that, despite complexity challenges, incremental progress continues to be made in the development of 5G, and the 3GPP’s Release 16 remains on track to be completed by the end of this year, fulfilling the initial promise of 5G by providing a fully stand-alone system. Release 16 will also address some of the feature limitations in the Release 15 specifications.

The sixth annual 5G Summit, which was hosted by Nokia and New York University Tandon School of Engineering in Brooklyn, provided an overview of what happened in the 5G ecosystem over the past 12 months and delivered a forward-looking view into where companies and academia think the ecosystem is headed, even out to 6G.

Be bold and get moving: PwC on risk, digital transformation and embracing data

TBR perspective

With risk permeating every business conversation and PwC accelerating investments in digital-related offerings, including PwC Connected Solutions, which sits within its Risk and Regulatory Platform business, the firm has prepared for the next wave of opportunities. Trading on trust remains at the core, especially as the politics of data continue to disrupt PwC and its clients. Becoming customer zero keeps PwC consistent with peers, while pulling in risk differentiates, particularly against non-Big Four competitors. But the firm creates a good use case for embracing digital when it comes to managing risk. PwC’s broad spectrum of capabilities, including digital risk solutions, internal audit support, cyber and privacy advisory, due diligence, and third-party certification, add necessary dimension to its risk practice. They also help PwC protect its spot in the market as the shift to digital operations elevates the strategic importance of risk and compliance functions.

“By rethinking risk, you create confidence at scale”

Across client panels, which featured risk and IT professionals from various industries and countries, similar themes emerged, including the evolution of understanding the value of smart risk-taking (Being a smarter risk taker through digital transformation, a recent PwC paper). Additionally, panelists, attendees, and PwC risk and consulting specialists spoke of the profound shift from managing and containing risk to leveraging risk processes and profiles to build transparency and confidence in an organization and enhancing trust with customers and partners. The similarities among the professionals’ comments created layers of emphasis, particularly around trust and scale.

One client noted, “Companies that know and manage risk smartly, build trust with their customers [and] move faster themselves.” The client explained that risk management enables his company to build trust with customers faster and react to security issues more quickly than competitors. When a futurist spoke about emerging technologies and their impact on future organizations, he peppered his remarks with comments around the ethics of powerful technologies. The underlying questions: “Is the system trustworthy?” and “Can we trust the people [working those systems?]”

Scale risk management across an organization through developing talent

The PwC client who reintroduced PwC’s tagline, “by rethinking risk, you create confidence at scale” succinctly pulled together two recurring thoughts across this year’s Risk Summit: talent and digital transformation. Multiple clients and PwC professionals spoke of the importance of talent. One client stated, “The first priority is to develop talent,” even as they recognized that decreasing budgets for risk management and increasing competition for skilled IT talent resulted in pressure to expand an appreciation for risk more widely across an organization — or essentially to scale risk management practices through education and analytics-based decision making. Not surprisingly, all of these issues and opportunities fall well within the scope of PwC’s expertise.

For the second year in a row, TBR attended PwC’s annual Risk Summit, a client-centric event geared toward sharing lessons learned among client risk professionals and presenting PwC’s thinking on risk and successes to date to the analyst community. This year the summit featured multiple client panels and created a clear picture of issues most prominent in the Risk space.