Early cloud adopters gain customer experience advantages, says report

Amdocs’s new global study found that communications and media providers are rapidly adopting cloud-native technologies.

Early adopters and fast movers will reap the crucial agility and innovation advantage needed in the digital economies to outpace competition, according to the report.

In order to obtain the agility and continuous innovation needed to meet the digital experience benchmark set by digital disruptors, a select group of communications and media providers is adopting cloud-native technologies.

However, most service providers are moving slower, hindered by legacy technology, culture, and processes, as well as the challenges of managing both legacy and cloud-native systems in a hybrid, combined environment.

Bringing tech into everyday operations

While the move to cloud-native systems is visible across the industry, mainstream adoption is unlikely before 2022. The laggards will find it challenging to close the early leads established by the fast movers.

These are part of the findings from an Amdocs-commissioned global study of leading communications and media companies by Analysys Mason, a global consultancy and research firm specialising in telecoms, media, and technology.

The results are based on in-depth discussions with senior executives of the surveyed companies.

Mark H Mortensen, research director of digital transformation at Analysys Mason, said:  “Communications and media providers are following the initial lead of web-scale software companies such as Amazon and Netflix in adopting cloud computing, DevOps practices, and cloud-native software architecture.

“What we see from the survey is that this is mostly being driven by the need to boost agility and innovation. Even though full transition is almost a decade away, those providers who can bring these technologies into their everyday operations quickly will secure the strongest competitive advantages.”

Need for greater agility and faster innovation

More than 82% of respondents said cloud-native and DevOps adoption is driven by the need for greater business agility and innovation. Only 36% said it is driven by the need for cost optimisation.

Hybrid cloud infrastructure to be mainstream by 2022:

Over 80% of digital, BSS and OSS systems currently run on physical or virtualised data centers. However, by 2022, over 90% of systems will run on cloud infrastructure, of which, over 60% will be on the hybrid cloud.

Microservices are a key priority in cloud-native tech:

82% either have or are proactively working on a roadmap to evolve their digital, BSS and OSS systems to be cloud-native, with 64% saying that microservices architecture will be a requirement for new systems within two years.

DevOps still has a long way to go:

46% currently use DevOps in limited areas of their IT environment (primarily in digital domains), 18% have a plan in place to adopt DevOps within the next 1-2 years, while 27% are still evaluating transitioning to the methodology.

Managing a ‘hybrid’ IT environment isn’t simple:

91% believe operating cloud-native and traditional applications side-by-side will be a critical challenge, requiring 64% to re-skill their workforce and 27% to engage a third party.

Gary Miles, chief marketing officer at Amdocs, added: “With early adopters such as Netflix, Amazon, Spotify already setting a high bar for agility and innovation, service providers who want to seize the advantage in today’s digital world need to view cloud technology, microservices architecture and DevOps adoption as ‘must-haves’ – and they need to move fast.

“The problem is that transition to the cloud is being held back by the daunting nature of managing cloud-native systems together with traditional ones. But while this ‘hybrid’ reality is likely to remain with us for the next 5-10 years, we’re already enabling service providers to overcome this co-existence complexity.

“In fact, customers who are adopting Amdocs cloud-native digital solutions, managed operations and services, are finding that their transition to digital is faster and more cost-effective.”

Written from press release by Leah Alger