Verizon’s big advantage teeters on the edge of MEC

If there’s one thing Verizon CEO Hans Vestberg has driven home, it’s Verizon’s lead in the edge computing space, where it’s getting a little help from its friends in the cloud business – Amazon Web Services (AWS), Microsoft and Google.  

During an earnings call with analysts last October, Vestberg was asked when Verizon’s progress in this area will actually start contributing real revenue growth. Vestberg noted there are basically three use cases here: public mobile edge compute, private edge compute and private 5G networks. “All of them sort of are in execution right now,” Vestberg said.

Verizon is working with customers like Corning, British Ports and others. “That’s already happening, and of course, it takes some time because we are actually creating a totally new market, and we are actually alone in this market,” he said. “Nobody else in the world has launched mobile edge compute at this moment.”

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It’s hard to make edge computing sound super provocative. It’s basically about building an architecture for a cloud-based service environment at the edge of a network. Verizon uses terms like “the eight currencies of 5G” to describe some of the opportunities that are mostly yet to be realized. Factory automation and augmented reality/virtual reality are among the use cases.

Grand View Research pegs the global multi-access edge computing (MEC) market size at $23.36 billion by 2028. But Dell’Oro Group points out that the MEC market is still a fraction of the overall mobile core network market.

Recent moves by Ericsson could help boost MEC, according to Dell’Oro analyst Dave Bolan. Ericsson said it’s implementing edge computing using 3GPP standards; it’s part of Release 17 so it’s not yet finalized. However, it’s mature enough to start commercializing it, and “I think that’s an important milestone for 5G carriers to start promoting edge,” Bolan said.

Who’s jumping into the pool?

“Is Verizon ahead? Yeah. But this is a marathon run. There are another 42,000 meters to go,” said industry analyst Roger Entner of Recon Analytics. “We’re all early in this game… Everybody is doing it. It’s just that Verizon talks more about it than everybody else.”

5G and mobile edge clearly target the business segment, so when you look at the customer bases, “the one who should actually have the fastest impact should be AT&T,” Entner said. “AT&T’s strength is large enterprise. Verizon’s strength is in SMB, small and medium businesses, and T-Mobile is still looking for a strength.”

AT&T bills its MEC offering as an on-premise edge solution that use LTE or 5G for private networks. According to its website, AT&T MEC customers can connect with Microsoft, IBM and Google.

Last year, T-Mobile announced a deal with Lumen Technologies, formerly CenturyLink, in the 5G and edge compute space, but executives haven’t spent a lot of time talking about it during conference calls or analyst events.

However, T-Mobile is the only U.S. operator with a nationwide standalone (SA) 5G network, and standalone (versus non-standalone, which is what AT&T and Verizon have now in the U.S.) is the foundation to enable a lot of the edge computing capabilities that are so often talked about.

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“We are actively engaged in a number of large-scale enterprise deployments leveraging 5G Advanced Network Services (ANS), like MEC and private 5G networks, to solve real use case that deliver value and ROI,” said Mishka Dehghan, SVP of T-Mobile for Business Strategy, Product & Solution Engineering, in a statement. “While many players in the marketplace can move compute resources closer to the end customer, we are confident that T-Mobile is the only operator that can truly unlock the value of Multi-Access Edge Compute (MEC).”

T-Mobile customers across industries are exploring MEC to process data locally, securely and quickly, according to Dehghan. Airline customers are one example where MEC applications could help provide ground and flight crews with information to speed aircraft turnaround times, resolve gate issues and streamline operations. T-Mobile alluded to that in its work with Alaska Airlines.

MEC or “MEH”?

Of course, who’s leading the race also it depends on how you define the edge. For starters, is it multi-access edge computing or mobile edge compute? Ericsson refers to both in its explainer. Around 2017, ETSI changed the name of its specification group from mobile edge computing to multi-access computing to better describe its applicability beyond mobile telecommunications.

“There’s a lot of different definitions of edge,” Dell’Oro’s Bolan told Fierce. “In my definition of edge, it’s an extension of the mobile network,” and that’s what Verizon is doing with AWS Wavelength, providing services at 17 edge sites in the U.S.

Still, AWS Wavelength is only one of about a dozen edge products/services in AWS’ portfolio, said Dean Bubley, industry analyst and founder of Disruptive Analysis.

Bubley doesn’t believe there’s much of a MEC market, dubbing it “MEH,” for Mobile Edge Hype. “Lots of noise, very little action,” he said. “Massive overhype, even by 5G’s massive overhype baseline.” Fixed edge is more important than mobile edge and “probably 10x delta in opportunity,” he said.

For what it’s worth, Verizon views itself as leading in the public MEC space by every definition of the term, and in private MEC, it’s leading as well, according to Matthew Threefoot, director of edge platforms at Verizon.

“There are folks that call a lot of things MEC,” he told Fierce late last year. “But when you talk about being able to manage a tightly integrated, high performing, low latency platform that’s all the way from the device through to the application… I would say that we have the most comprehensive set of offers out in the market.”

Verizon will have a lot to talk about at its investor meeting tomorrow: the C-band deployment, its fixed wireless access business, the TracFone integration, to name a few. MEC is likely to come up again, if it’s as big an opportunity as Verizon makes it out to be. But if it’s really big, it’s also in the sights of its competitors.