HPE telco vertical ‘key gateway’ for future growth

HPE telco vertical ‘key gateway’ for future growth

Vendor’s CMS solution has potential to be ‘significant disruptor' in the telco space

Credit: HPE

Hewlett Packard Enterprise’s (HPE) telecommunications capabilities may be one of its unspoken heroes for future revenue growth, a new report has found.

According to analyst firm Technology Business Research (TBR), the vendor’s previously “marginalised” Communications and Media Solutions (CMS) has received new life amid the global business transformation sweep. 

In particular, the changes prompted by 5G, edge computing, artificial intelligence (AI) and automation will become a “key growth pillar” for HPE as new opportunities emerge in the telecommunications industry.

In particular, the vendor is in a prime position in the management and orchestration (MANO), 5G core and digital identity spaces, TBR claimed. 

Although the proportion of CMS revenue is relatively small, TBR principal analyst Chris Antlitz claimed the unit is “reestablishing itself” and now receiving the necessary funding and support to drive this.

“TBR believes CMS is positioned to be a key vendor in the new network architecture, which will be microservices-based, cloud-native and distributed,” he said.

However, the path to re-establishing its CMS credentials is not clear cut, TBR warned, noting the “bad press” HPE received in 2015 when it was the systems integrator for Telefonica’s software-defined transformation program. 

At the time, HPE was publicly dropped as the Spanish telco’s prime supplier in the scheme, and a tender was re-issued. This subsequently hindered the CMS division’s growth over recent year, TBR argued. 

Nevertheless, Antlitz concluded the vendor’s “mindshare and credibility are moving in a positive direction” in this space and now has an “impressive roster” of communications service provider (CSP) customers and has played a “behind-the-scenes” role in several significant network transformation projects, including SK Telecom and Vodafone.

“The most difficult challenge may be delivering on helping CSPs become more than the connectivity provider or “dumb pipe” in a 5G world,” Antlitz added. “Vendors will be jockeying to deliver this dream, but HPE may be better served focusing on providing the solutions that will enable CSPs to run the most efficient, cost-effective networks possible.”

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