Verizon moves to bolster global business ambitions

Verizon outlined its ambition to further grow its global enterprise communications services revenues during the recent opening of its London 5G Innovation Hub. The hub is an interactive space where Verizon can showcase its services to enterprises, including private network solutions for manufacturers and retailers.

It’s not the first time Verizon has established a customer hub in the UK capital. Nor is the operator new to offering 5G services in the region. In 2021, for example, it announced a 5G private network deal with Associated British Ports, its first in Europe.

In addition to private networks, the US communications service provider is also targeting growth in SD-WAN and secure access service edge (SASE) services in both Europe and Asia-Pacific.

Indeed, the coming together of network and security in the form of SD-WAN and SASE accounts for 75% of new business in the EMEA pipeline, says Sanjiv Gossain, GM and Head of EMEA, Verizon Business, as companies look to establish zero-trust security systems and manage the complexity of multi-cloud environments.

Verizon is building on a firm foundation, according to analysts: It is currently the global telecoms leader in enterprise managed services, based both on the number of deals and their total contract value, says David Molony, Principal Analyst, Enterprise Services, Omdia. The other global network operators Omdia tracks include AT&T, BT, Colt, GTT Communications, Lumen, NTT, Orange Business Services, Tata, Telefonica, Telstra, T-Mobile, T-Systems, and Vodafone.

One of Verizon’s strengths is that only a dozen or so global telecoms operators worldwide have the scale to invest in constantly renewing their systems and service technologies to offer virtualized network (SD-WAN), hybrid cloud management, private 5G and some data analytics, notes Molony. And operators typically acquire scale by serving domestic markets that have traditionally been home to some the world’s large international enterprises, such as the US, France and Germany.

Big in Japan

But some of the biggest and fastest changes in technology adoption are taking place in Asia-Pacific, where Verizon Business sees “a once in a century opportunity”, as enterprises – and in the case of India, entire societies – undertake rapid digitization, according to Robert Le Busque, Regional Vice President, Asia-Pacific, Verizon Business Group.

One of the major shifts in the region is that now “CIOs are asking [Verizon] what their companies can do to be competitive” using technology, according to Le Busque.

In Japan, in particular, a move towards a distributed architecture and investment in cybersecurity has resulted in “significant double-digit growth [for Verizon] for the last two years”, says Le Busque. The company’s wins in the country include a contract to provide Fuji Film with cybersecurity monitoring.

From global to private

The question for global telcos is whether they can extend strengths in SD-WAN and SASE into a large enterprise private network play. Duncan Kenwright, Managing Director, Global Presales, APAC, Verizon Business, believes that “private networks fit naturally with a transformed network estate.”

He contends that telcos’ networking and security experience makes them well placed to support the shift by enterprises towards using applications to drive decision-making within secure, data-rich technology platforms. “AI, machine learning, generative AI .. it is all about data … [and] we know how to move data at size and scale. With technology such as 5G we move it at almost real time.”

The market for private industrial networks, however, presents several challenges for telcos. For a start it can bring them into direct competition with large systems integrators, which are skilled at handling complex, sector-specific, digital transformations, as well as partnering with other technology companies. In addition, outside of China, the adoption of 5G MPNs in fields such as manufacturing is still in its infancy (although Verizon Business supports other networking technologies, including 4G).

But 5G private network contracts can be multi-million deals, and that makes them worth pursuing, explains Molony. “They are among the biggest enterprise managed services deals and … are important additions to the global network business,” he says, adding that Orange, Telefónica, Verizon and Vodafone are the telco leaders in the field.

Prioritizing partnerships

In addition, Molony believes that “telcos are getting quite adept at partnering with systems integrators, network vendors, device and apps companies.”

Certainly, Verizon is quick to stress its willingness to work with partners as part of a wider ecosystem. “We collaborate with partners on best of breed networks and security,” says Gossain, pointing to Nokia as one example of its partnerships to address the private network and security markets.

And as the company looks to support edge networks “we need integrators who can work with software,” says Kenwright.

Another issue for Verizon when addressing the MPN network outside its US borders is a lack of spectrum.

Kenwright, however, argues that owning no spectrum can have its advantages: “We are relieved of any requirements to monetize spectrum. After the acquisition of spectrum by private companies we can simply operate.” Nonetheless, it does tend to restrict MPN opportunities to countries that have carved out spectrum for use by enterprises, such as Germany or the UK.