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Importance of MVP & Proof of Concept

October 12, 2022 - Anton Palagin

Exploring real-world examples of bids to build low-latency eager services based on existing technologies. How will that define the direction & strategies of future business models?

Edge computing and high-performance services have been hot topics generating a lot of hype in recent years. The telco industry has strong expectations from relevant use cases such as AR, VR, MR, or telemedicine dreaming about new revenue streams, and business models and taking steps in standardization toward a new North Star. Although, a different perspective can be beneficial. Do we really believe telecoms may expand beyond their existing business models and connectivity-based services? Is there any meaningful revenue for them beyond this? And do edge application vendors really need anything else from telecom than reliable connectivity?

In 2019, Three Ireland won the contract to provide the communications network, with a consortium of Siemens Ireland and Kamstrup winning the contract to give meters and supporting technical infrastructure for state-owned energy company ESB. Installations started in 2020 with the aim to install 2.5 million devices in homes around the country in the next 6 years. Why is it interesting? It is pretty simple – Three Ireland doesn’t need any 5G or IoT technologies to do that either as they do not require network slicing, edge clouds, partnerships with hyperscalers, or anything else. They used 2G/3G powered smart meters and their existing network to connect them to ESB. They managed to win the contract, and so far, have installed almost a million devices, generate revenue, and conducted business accordingly. Now if desired, they can add 5G, network slicing, and clouds to make the business model both scalable and operable. They may even add as many complexities to this solution, as needed. What is more important is that the initial focus is on a self-sufficient minimum viable product, with a clear business case that makes commercial sense, and then they won it.

There are plenty of other examples when people build low-latency eager services based on existing technologies and already distributed hyperscalers clouds. You cannot play first-person online shooters if low latency is not guaranteed, it kills game fairness if the opponent may spot you a few moments earlier. To solve this problem, famous online gaming vendor Riot Games teams up with AWS and they leverage their distributed cloud and points of AWS presence across the globe. Can anyone explain to me how it is different from edge computing ideas?

So, the next question for me is, can such services work without connectivity? No, they cannot. This is the only way consumers are connected to a service. Making telecoms a mandatory ingredient in this cocktail. The level of their involvement in the end-to-end service dictates their share of revenue and level of investments into an infrastructure they are ready to do. Therefore, a key goal is to find the right balance that works for them. Another key goal is finding the right execution strategy; it is a chicken-and-egg problem – you cannot build a killer use case without a solid foundation. To build a foundation, you need a killer use case. So, it is worth applying a step-by-step approach, defining, and implementing a minimum viable product, proving the business case, optimizing its operations, and making it profitable, ensuring your platform’s scalability while adding more use cases, reviewing the platform, optimizing, and scaling it again, so on and so forth.

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