23 May, 2024
ETNO-GSMA contribution to BEREC Report on Cloud and Edge Computing Services
Cloud and edge services are at the core of the transformation that our sector is undergoing: telecoms operators are turning their networks into platforms for innovation by embracing disaggregated and cloud native architectures, high automation (e.g. based on AI/ML), programmability, and the development of new network as a service (NaaS) applications. As ETNO and the GSMA, we have outlined our vision for telecom transformation in our contribution to the European Commission’s consultation on the future of the electronic communications sector and its infrastructure, which is clearly reflected in the Commission’s White Paper “How to master Europe’s digital infrastructure needs?”1.
As outlined in the draft BEREC report, the provision, on the one hand, of cloud and edge services, and on the other hand, of electronic communication networks (ECN) and services (ECS), is increasingly interlinked. The markets exhibit interdependence and intertwining, with major players in the cloud market expanding their influence into traditional ECN/S markets. These trends carry significant implications not only at a technical and market level, but also from a regulatory standpoint.
One of the overarching principles of the EU regulatory framework is technology neutrality, which consists in remaning agnostic to underlying technologies and ensuring a level playing field for all market players. Regulation cannot be separated from the concrete provision of services in the value chain and must be consistently applied across sectors and stakeholders.
As indicated in the report, cloud services are provided in a highly concentrated market, where hyperscalers play a central role, thanks not only to their size, but also to the existence of network and ecosystem effects. These effects can potentially lead them to leveraging market power from adjacent markets, and also into the ECN/S market. This, in turn, has sovereignty implications as these cloud providers enjoy a bargaining position that is very difficult to challenge, with the potential ability to impose strict or unfair terms on a vertical market such as telecom.
In this contribution, we would like to offer some complementary observations regarding the cloud and edge markets from the telecom perspective, to then focus specifically on the section of the draft report related to network cloudification regulatory considerations.
