The News: Dell Technologies and Ericsson announced a strategic alliance to combine their industry expertise with telecom software, solutions, and support to guide communications service providers (CSPs) through their radio access network (RAN) cloud transformation journeys. Read the full press release on the Dell website.
DTW24: Dell and Ericsson Boost Joint Goal to Spur Telco Cloud Journeys
Analyst Take: Dell and Ericsson have augmented their partnership to push CSP cloud transformation journeys forward. To make this happen, the pair is commercially debuting Ericsson Cloud RAN software on Dell PowerEdge servers underpinned by continuous testing and lifecycle management plus joint services that offer CSPs integrated network infrastructure support.
Both Dell and Ericsson are seeking to unstick CSP transformation journeys, invoking the MeriTalk study indicating that a whopping 96% of CSPs report that their network transformation journey is lagging due to considerations such as time and budget constraints alongside reliability and security issues.
Dell and Ericsson are working together to cultivate customized cloud network transformation journeys and provide guidance to CSPs on network structures and operational frameworks that minimize the deployment risks across open, heterogeneous vendor environments. Ericsson’s Cloud RAN software will now be commercially launched on Dell PowerEdge servers aimed at accelerating deployments and minimizing risks associated with day-2 operations, such as upgrades and updates, by providing ongoing integration testing and lifecycle management. As such, both are bringing the choice and flexibility that CSPs prioritize for their Cloud RAN journeys.
From my view, the Dell Tech World announcement by the duo adds momentum to their overall existing partnership. For example, their April 2023 announcement detailed the combinations of Dell PowerEdge servers with Ericsson’s Cloud RAN solution, including the PowerEdge XR8000 and XR5610, which are specifically designed for telecom, Open RAN and mobile edge-computing workloads. I see that fulfilling such swiftly evolving workload demands across multi-vendor, cloud environments, including hybrid and multi-cloud, increases CSP demand to work with 5G solutions providers, such as Dell and Ericsson, who can offer lead integration resources and capabilities backed by extensive track records of reliability and expertise.
Plus, I find that the partnership update shrewdly aligned with Ericsson’s USA 5G Smart Factory event conducted in Lewisville, Texas. At the event, Ericsson unveiled an additional investment of $50 million, after the initial $100 million investment unveiled in 2020 to its facility. Key to the investments is boosting local production to fulfill the demand for 5G Infrastructure made in the USA, conforming with the Build America Buy America (BABA) Act.
This helps reinforce overall US government priorities related to strengthening national security, such as ensuring more resilient supply chains less prone to disruptions outside the country (i.e., natural disasters, geopolitical conflict) as well as boosting domestic employment. From my view, the event included the high-profile presence of major customer AT&T, which also underlined that Ericsson and Dell share the same Texas backyard at least when it comes to the 5G ecosystem.
AT&T, headquartered in Dallas, Texas, is working with Dell and Ericsson to modernize its network with emphasis on using software update and open architecture that eases the mixing and matching of best of breed components across multi-vendor implementations. In December 2023, AT&T announced that it plans to have fully integrated open RAN sites operating in coordination with Ericsson and Fujitsu starting this year with commercial traffic running across Ericsson Cloud RAN solutions having started February 2024. The deal includes a $14 billion, 5-year term with Ericsson underpinning AT&T’s plans to shift up to 70% of its wireless traffic to an open RAN architecture by 2026.
Looking Forward: The AI Factor in the 5G Ecosystem
I find that the AT&T Ericsson Open RAN deal shows that top-tier CSPs will look to work with partners with lead integration capabilities to ease the early stages of their cloud network transformation journey including the Open RAN component. As such, I discern that Dell and Ericsson can potentially fulfill that role with CSPs, including AT&T, when it comes to their AI journeys, especially in relation to using AI-infused 5G to strengthen meeting evolving network edge and IoT demands.
Currently, Ericsson and Intel are working together to advance the application of artificial intelligence (AI) and machine learning (ML) in the RAN domain, including enabling a portable and compute-agnostic methodology for AI interference at the edge. This includes the integration of insights from the Intel vRAN AI Development Kit, which can speed up the availability of rApps ecosystem and boost Ericsson’s network automation and optimization capabilities. In addition, Dell is expanding the Dell PowerEdge XE 9680 with Intel Gaudi 3 acceleration to offer customers flexibility in tailoring their systems to specific computational needs, especially associated with GenAI workloads.
Plus, the Dell AI Factory can provide CSPs with the infrastructure, solutions, and services needed to expedite the adoption and scaling of AI. This can include the Dell AI Factory with NVIDIA offering that provides integrated Dell and NVIDIA capabilities including pre-validated, full stack solutions that can leverage and optimize AI, which can provide connected intelligence to smart devices, including IoT, at the network edge.
Already Ericsson is developing digital twins with the NVIDIA Omniverse in areas such as accurately simulating and understanding the interplay between 5G cells and the environment to achieve optimized coverage and performance. As a result, I also anticipate tighter coordination between Dell, Ericsson, and NVIDIA in addressing the CSP space, particularly in their journey toward an AI-native telco model, moving forward.
Key Takeaways: Dell Ericsson Ready to Spur CSP Cloud Transformation Journeys
I believe that the Dell Ericsson alliance can play an integral role in ensuring that CSPs can attain the foundation that is key to catalyzing network cloud transformation and improving their business outcomes, including easing the adoption and scaling of Open RAN using Cloud RAN technologies. I also expect that the alliance is now well positioned to also play a critical role in guiding and supporting CSP strategic objectives to optimize their AI/ML workloads across their overall 5G environments, including GenAI, network edge, and IoT applications.
Disclosure: The Futurum Group is a research and advisory firm that engages or has engaged in research, analysis, and advisory services with many technology companies, including those mentioned in this article. The author does not hold any equity positions with any company mentioned in this article.
Analysis and opinions expressed herein are specific to the analyst individually and data and other information that might have been provided for validation, not those of The Futurum Group as a whole.
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Author Information
Ron is an experienced, customer-focused research expert and analyst, with over 20 years of experience in the digital and IT transformation markets, working with businesses to drive consistent revenue and sales growth.
Ron holds a Master of Arts in Public Policy from University of Nevada — Las Vegas and a Bachelor of Arts in political science/government from William and Mary.
