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Table of contents
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Selected Highlights
An introduction to cloud computing

Telco perspective
on cloud

applications on a
federated cloud


Mobile cloud


Mobile cloud computing

New opportunities and challenges for operators

Olafur Ingthorsson
Siminn (Iceland Telecom)

Mobile cloud computing (mCC) represents a relatively new and fast growing segment of cloud computing. mCC is about provisioning mobile applications and services in the cloud, enabled through cloud service providers and delivered to end-users’ mobile handsets over the Internet. In a recent study by Juniper Research, annual revenues from cloud-based mobile applications are expected to reach $9.5 billion in 2014, from $400 million in 2009. The numbers of mCC subscribers worldwide are forecasted to grow to almost 1 billion in 2014, about 20% of total mobile subscribers, according to a study by ABI Research. 

Growth of mobile cloud computing
Currently, most mobile applications are being provided directly from online application stores for immediate download and installation in supported smartphones, either against payment or free of charge. Examples of this are apps for the iPhone that are exclusively being downloaded from Apple‘s App Store and, likewise, Android apps from the Android Market. Smartphones steadily become more powerful to improve the user-experience and provide faster processing of larger and more resource-intensive handset-centric applications. 

Contrarily, in mCC both the data processing and storage is primarily being transferred from the handset itself to the cloud provider, i.e. the handset will be used as a network device to display apps in a mobile browser or through a thin-client interface. Numerous services and apps are already being provisioned in this manner, including Gmail and Facebook for mobile users. The aforementioned ABI Research study forecasts that by 2014, mCC will become the leading mobile application development and deployment strategy, displacing today‘s native and downloadable mobile applications. Even new versions of smartphones, called mobile cloud phones, that are specifically designed for mCC applications and services will soon start to emerge. 
Figure: Mobile Cloud Computing Revenue by Region 209-2015 (ABI Research) 

Mobile cloud computing issues and limitations
At the same time it is obvious that mCC is not going to be the best solution for every need. It poses challenges due to the intrinsic nature and constraints of wireless networks and devices. This is especially true when it comes to rich-internet (RIA) and immersive mobile applications, e.g. online gaming and augmented reality that require high-processing capacity and minimum network latency. These will most probably continue to be processed locally on powerful smartphones and mobile tablets. Mobile broadband networks generally require longer execution times for a given application to run in the cloud and network latency issues may render certain applications and services unfit for the mobile cloud. In summary, some of the most critical issues related to mCC include:

  • Network latency and limited bandwidth in the mobile network.

  • Limitations towards bandwidth-hungry apps/services.

  • Restrictions in utilising handset features, e.g. GPS and Bluetooth.

How will MNOs manage in the mobile cloud?
From a mobile network operator (MNO) point of view, and despite the often confusing nature and intangibility of cloud computing concepts, it seems evident that mCC is going to contribute to a dynamic shift in the delivery of remote services. When it comes to the provisioning of cloud-based applications and services, the function of MNOs falls into a similar pattern as of operators in the fixed-network domain, namely primarily providing network connectivity and Internet access.

Most current mCC applications and services are provisioned by global players like Google, Facebook and Dropbox and mostly bypass the MNO value-chain. Relying primarily on revenues from surge in data traffic seems unsustainable in the long term, especially as data revenues do not increase proportionally with data traffic. In fact, according to an ABI Research, while data traffic is expected to increase at a compound annual growth rate (CAGR) of 42% until 2015, data revenues will only grow at a CAGR of about 15-18%, in sharp contrast to the increase in usage. Several ideas have emerged that might benefit MNOs for assuming a greater role in the mCC domain in addition to providing network connectivity and access. These include various mash-up services by integrating network-centric data, such as identity and location data, with third-party applications and to provide cloud intermediation, aggregation and arbitration through cloud brokerage. 

The aim of an ongoing Eurescom study (P2051) on „Opportunities and challenges for MNOs in the mobile cloud“ is to understand how the mobile cloud is developing and to determine MNOs position and opportunities in the value-chain of mobile cloud service provisioning and, finally, to provide recommendations to participating MNOs as a starting point for further analysis and strategic decision making. Further information about P2051 is available at

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