While the mobile network is recognized today as the primary network where all of the profitability of the telcos is contained, some industry experts believe you have to deconstruct the value chain. One of those experts is Alan Cohen, chief commercial officer at Illumio Inc.

“What telcos do is they offer up content, for the most part,” Cohen said. “Aside from calls, the biggest use is some form of internet applications. But telcos don’t get any more money from an app, for hosting it, for managing it. … They don’t get very much money from making it perform.”

Cohen recently joined John Furrier (@furrier), co-host of theCUBE, SiliconANGLE Media’s mobile live streaming studio, for a live interview at SiliconANGLE Media’s studio in Palo Alto, California.

Up for discussion was this week’s Mobile World Congress in Barcelona, as well as the ongoing telco profitability issues and changing data center dynamics in a world of increasing data.

Profitability and data centers

Cohen said that he believes the biggest threat to telcos is Amazon, because it is now the supply chain for so much internet delivery content. If a telco wants to be something other than the last mile of the Internet connection, they need to come up with a different model for profitability, he explained.

He also observed that Netflix and Amazon Prime are not just waiting for consumers to be at their TVs to watch their content; they are actively seeking people to watch and pay for the content. As there is nothing more ubiquitous than the piece of glass most consumers carrying in front of their noses, all day, every day, it makes perfect sense to look to mobile devices, Cohen stated.

Regarding data processing, Cohen observed that it should move closer to where the data is generated. He gave the example of the city of Palo Alto, running a fleet of autonomous cars. As these cars are constantly generating huge amounts of data that needs to be processed, it makes much more sense to process the data closest to where the cars are located. This will involve an architectural shift from a centralized to a distributed model; for example, instead of 10 megadata centers, there might 1,000 “mini” megadata centers.

“I make my living out of making data centers more secure, but the data center is going to completely evolve. The sheer profusion of data that’s going to come out [mobile devices] is going to blow up the idea of backhauling it to a centralized server, processing it and spitting it back out,” said Cohen.

Watch the complete video interview below, and be sure to check out more of SiliconANGLE’s and theCUBE’s coverage of the Mobile World Congress 2017 Barcelona.

Photo: SiliconANGLE