“As the industry moves to 5G, operators will have opportunities to advance the virtualization of their core networks and move forward on a path to an increasingly cloud-native future,” according to Khalidi.
This announcement comes less than a month after Microsoft’s acquisition of Affirmed Networks, which focuses on cloud-native networking solutions for telecom operators and mobile carriers.
“Coupled with its recent acquisition of Affirmed, the move further cements MSFT's aim to become a major provider of virtualization services and 5G networking to global telecom providers,” Ryan Koontz, five-star analyst at Rosenblatt Securities wrote in a note to investors. “While we hold doubts as to the scope of near-term financial gains for Azure in the telecom segment, we see strategic advantages as Azure gains access to valuable real estate at the carrier edge.”
According to Koontz, the 5G Core market is estimated to reach about $10 billion by 2025 from its current $1 billion, “seeing impressive growth as 5G stand-alone (SA) networks begin wide scale deployments beginning in 2021”.