 theCUBE's live coverage is made possible by funding from Dell Technologies. Creating technologies that drive human progress. Hey everyone, it's so good to see you. Welcome back to theCUBE's day two coverage of MWC23. We are live in Barcelona. Lisa Martin with Dave Nicholson. Dave, we have had no signage of people dropping out. This conference is absolutely jam-packed. There's so much interest in the industry. You've had a lot of interviews this morning. Before we introduce our guests and have a great conversation about the industry and challenges and how they're being solved, what are some of the things that stuck out to you in conversations today? Well, I think the interesting kind of umbrella conversation that seems to be overlapping, you know, overlying everything is this question about open-ran and open standards in radio access network technology and where the operators of networks and the providers of technology come together to chart a better path forward. A lot of discussion of private 5G networks. It's very interesting. I think I've said this a few times from a consumer's perspective, we feel like 5G has been with us for a long time, but it's very clear that we're really at the beginning stages of this. And I'm super excited for our guests that we have here because we're going to be able to talk to an actual operator and hear what they have to say. We've heard a lot of people talking about the cool stuff they build, but we're going to get to hear from someone who actually works with this stuff. Who actually built it, absolutely. Please welcome our two guests. We have Ehab Tarrasi, CTO and SVP at Dell Technologies and Juan Carlos Garcia, SVP Technology Innovation and Ecosystems at Telefonica. It's great to have you guys on the program. So thank you very much. So the buzz around this conference is incredible. 80,000 plus people, 2,000 exhibitors. It's standing room only. A lot of opportunity in the industry, a lot of challenges though. Juan Carlos, we'd love to get your perspective on what are some of the industry challenges that Telefonica has faced that your peers are probably facing as well. Well, we have two kinds of challenges. One is a business challenge, I would say, that we may find in other industries like profitability and growth, and I will talk about it. And the second challenge is a technology challenge. We need the network to be ready to embrace a new wave of technologies and applications that are very demanding in terms of network characteristics and features. On the efficiency and profitability and growth, the solution comes as a challenge from changing the way networks are built and operated, from the traditional way to make them become software platforms. And it's not just that the only challenge, it's also changing the mindset of network operators from a network service provider to a digital service provider. And this means several things. Your network needs to become software-based so that you can manage it digitally. And on top of them, you need to be able to deliver digital services digitally. So there are three aspects, making your network software-based and cloud-based, and then be able to sell in a different way to our customers. So some pretty significant challenges, but to your point, Ron-Karlis, you share some of those challenges with other industries. So there's some commonality there. I wanted to bring Ehab into the conversation from Dell's perspective. We're seeing the explosion of data. Every company has to be a data company. We expect to have access to data in real time, if it's a new app, whatever it is. What are some of the challenges that you're seeing from your seat at Dell? Yeah, I think Ron-Karlis explained it really well what all the operators are talking about here. Between new applications, think metaverse, think video streaming going all the way to the edge, think all the automation of factories and everything that's happening. It's not only acquiring a whole new model for delivery and for building networks, but it's throwing out enormous amount of data. And the data needs to be acted on to get the value of it. So the challenge is, how do I collect the data? How do I catalog it? How do I make it usable? And then how do I make it persistent? So it's high performance data storage. And then after that, how do I move it to where I want to and be able to use it? And for many applications, that has to happen in milliseconds for the value to come out. So now we've seen this before with enterprise, but now I would say this digital transformation is happening at very large scale for all the telcos and starting to deal with very familiar themes we've seen before. So, Juan-Karlis, Telefonica, you hear from partners, vendors, that they've done this before, don't worry, you're in good hands. But as a practical matter, when you look at the challenges that you have and you think about the things you'll do to address them as you move forward, what are the immediate short-term priorities versus the longer-term priorities? What's realistic? You have a network to operate. You're not just building something out of nothing. So you have to keep the lights on and you have to innovate. We call that, by the way, in the CTO trade, ambidextrous management. You can go up here. So what's your order of priorities? Well, the first thing, new technologies, you are getting into the network, need to come with a digital shape. So being cloud-native, working by software, on the legacies that you need to keep alive, you need to go for a program to switch them off progressively, okay? In fact, in Spain, we are going to switch off the copper network in two years. So in 2024, Telefonica will celebrate 100 years and the celebration will be switching off the copper network and we'll have on the fixed access only fiber, okay? So modernizing the network is necessary. All this digitalization may happen only on the new technologies because the new technologies are cloud-based, cloud-native, become already ready for this digitalization process. And not only that, so you need also to build new things. We need an abstraction layer on top of the physical infrastructure to be able to manage the network by software, okay? This is something that happened in the computing world, okay? Where the servers, you know, were covered with a cloud-stack layer and we are doing the same thing in the network. We are trying to extract the network services and capabilities and be able to offer them digitally to our customers. And this is a process that we are ongoing with many initiatives in the market. So one was the Kamara community that was opened in Iliun's Foundation and the other one was the announcement we made yesterday of the Open Gateway Initiative here at Mobile World Congress where all telecom operators have agreed to launch in this year a set of service APIs that are common worldwide, okay? This is a similar thing to what we did with 2G 35 years ago. So agree on a standard way of delivering a service and in these cases, digital services based on APIs. What's the net result of? What are the benefits of having those open standards? Is it a benefit that myself as a consumer would enjoy? It seems, I mean, I've been, I'm old enough to remember a time before cellular telephones and I remember a time when it was very, very difficult to travel from North America to Europe with a cell phone. Now I land and my provider says, hey, welcome. Yes. Welcome, we're going to charge you a little extra money and I say, hallelujah, awesome. So is part of that interoperability a benefit to consumers or? Yes, you touch the right point. So in the same way you travel anywhere and you want to still make a call and send an SMS and connect to the internet, you would like your applications in your smartphone to work, being them H applications, okay? And these applications, H applications will have to be executed very close to where you are in a way that if you travel abroad, the visited network is serving you, okay? So this means that we are somehow extending the current interconnection and roaming agreements between operators to be able also to deliver H applications wherever you are in whatever network with whatever technology. We have that expectation on the consumer side that it's just going to work no matter where we are. We want apps to be updated, whether I'm banking or I'm shopping for groceries. I want to make sure that they know who I am. The data has got to be there. It's got to be real time. It's got to be right. It's got to serve me personally, but it just has to work. You guys talked about some of the big challenges but also the opportunities in terms of the future of networking, the data, turning companies into data companies. Walk us through the future of networking from Telefonica's lens. You talked about some of the big initiatives that you have by 2024. But if you had a crystal ball and you could look in there and go, it looks like this for operators. What would you say? And I'd love to get your feedback too. Yeah, I liked how one Carlos talked about how the future is. I think I want to add one thing to it to say, a lot of times the user is no longer a consumer, it's an automated thing. AI, I think robots, so a lot of times more and more the usage is happening by some autonomous thing and it needs to always connect. And more and more these things are extending to places where even cellular coverage doesn't exist today, so you have edge compute show up. And when you think about it, the things we have to solve as a community here, and this is all the discussions, is number one, how you make it a fully open standard model so everything plugs and play, more and more there's so many pieces coming software hardware from different components and the integration of all of that is probably one of the biggest challenges people want solved. How it's no longer one box you buy from one person and put it away. Now you have a complex combination of hardware and software. Also the operational model is very important and that is one of the areas we're focused on at Dell is that while the operational model works inside the data centers for certain application, for telcos it looks different when you're out at the cell tower and you're going to have these long extended temperature changes and sometimes this may not be inside a cabinet, maybe outside and the person servicing is not an IT technician. This is somebody that needs to know exactly how to plug it to be able to place equipment quickly and add capacity. Those are just two of the areas, the cloud making it work like a cloud where it's intuitive, automated and you can easily add capacity, you can get a lot of monitoring, a lot of metrics. Those are some of the things that we're all solving in this community. Let's talk about exactly how you're achieving this. Telefonica and Dell have been working together for a couple of years, you said before we went live. Talk about you're doing this. You talked about the challenges, the opportunities. How are you solving them and why with Dell? Okay, well you need to go with the right partners to this kind of process of transforming your network into a digital platform. There are big challenges on creating the cloud infrastructure that you need to support the complex functionality a network requires and I think you need to have with you companies that know about the processors, that know about the hardware, the server, that know about how to make an abstraction of that hardware layer so that you can manage that digitally and this is not something any company can do. So you need companies that are very specialized. Telecom operators are changing their way to work. We work in the past with traditionally with network equipment vendors. Now we need to start working with technology providers, hardware technology providers, with cloud providers with an ecosystem that is probably wider than what we had in the past. So I come from a background. I call myself a knuckle dragging hardware engineer sort of guy so I'm always fascinated by the physical part of this. You have a network, part of that network includes towers that have transmitters and receivers at the base of those towers and like you mentioned they're not all necessarily in urban areas or easy to access. There's equipment there. Let's say that the tower has been there for five years, 10 years. In the traditional world of IT we have this concept of the refresh cycle where a server may have a useful life of 36 months before it's consuming more power than it should based on the technology. How do you move from kind of a legacy more proprietary all-inclusive stack to an open system? I mean does this say okay we're planning for an outage for the tower and you're wheeling out old equipment and wheeling in new equipment? I mean that's what we say as a non-trivial exercise. It's something that isn't, it's not something that's just easy to do. But is that what progress looks like sort of methodically one site at a time? Yeah, well I mean you have touched an important point. In the technology renewal cycles you were taking an appliance and replacing that by another one. Now with the current technology you have to couple the hardware from the software and the hardware you need to replace it only when you run out of processing capacity to do what you want, okay? So then we'll be there two, three, four, five years whatever, when you need additional capacity you replace it. But on the software side you can make the replacement every hour, every week. And this is something that the new technologies are bringing a flexibility for the telecom operator to introduce a new feature without having to be physically there in the place, okay? By software remotely. And this is the kind of software network we want to build. Yeah, I want to add to that if I can. I think this is one of the biggest benefits of the open model. If the stack is all integrated as one appliance when a new technology, we all know how quickly silicon technology comes out and now we have GPUs coming out for AI more increasingly. And an appliance model, it may take you two years to take advantage of some new silicon that just came out. And this new open model, as one college was saying, you just swap out, you know, you have time to market, CPUs launched, it can be put out there at the cell tower and it could double capacity instantly. And we're going to need that in that world that increasingly going to be AI enabled. So. So my last question to you, we only got a minute left or so, is given everything that we've talked about, the challenges, the opportunities, what you're doing together, how would you, Juan Carlos, summarize how the business is benefiting from the Dell partnership and the technologies that you're enabling with this new future network? Well, as I said before, we will need to be able to be able to cover all the characteristics and performance of our network. We will need the right kind of processing capacity, the right kind of hardware solutions. We know that the functionality of the network is a very demanding one. We need hardware acceleration, we need a synchronization, we need time sensitive solutions. And all this can only done by hardware. So you need a good hardware partner that ensures that you have the processing capacity you need to be able then to run your software with the confidence that it will work and with the performance that you need. That confidence is key. Well, it sounds like what Telefonica and Dell have achieved together has been quite successful. Congratulations on the first couple of years. Sounds like it's really helping Telefonica's business move in the strategic direction that it wants. We appreciate you joining us on the program today, describing all this. Thank you both so much for your time. Thank you very much. Thank you, this was fun. A pleasure. Thank you. Good, our pleasure. For our guests and for Dave Nicholson and Lisa Martin, you're watching theCUBE live, day two from Barcelona, MWC 23. Don't go anywhere. Dave and I will be right back with our next guests.