03 Nov The 3 characteristics of the telecom infrastructure needed to win
It is clear now that this isn’t business as usual in the telecom space. This is no phase like fixed to mobile which were generational eras in the industry. In fact the advent of the digital age with a host of disruptive technologies, an involved online consumer and the shift of eyeballs and omnichannel behavior to the smaller screen has sown unprecedented chaos in how telecoms are responding. There’s a reason AT&T has been around so long. Most generational changes had a start and end and so long as you managed your cash flows well and shifted to the new technology ecosystem you were fine. This time is different. The ability for new disruptors to compete with the older players is limitless and threatens the laggards with possible extinction.
You’re hitting a moving target in this era with strategies constantly adjusted on the fly and failing fast as the killer behavior with regards to monetizing products & services. Who will win the cloud? Who will monetize mobility? Will web monopolies like Google relegate Telecoms to pipe maintainers? To us it’s clear. Telecoms that invest in agile technologies fast have a chance of creating their own destiny as they can adjust to the marketplace with their own portfolio of advanced products fastest. Speed is of the essence in this age lest you be irrelevant by the time the dust settles. The next generation telecom infrastructure needed to win in this digital age will have these three closely related characteristics:
NFV: Networks Functional Virtualization is how virtualization has affected how quickly telecoms roll out services. It’s when all network functions run on software relegating hardware to vanilla grunt work machines. This means if you are a multi billion dollar telecom equipment provider relying on proprietary hardware NFV is here to eat your lunch. NFV’s reduce both capex and opex dramatically, allow for a comparatively lightning quick roll out of services and allow a telecom to become demand driven literally having the flexibility to adjusting its services portfolio in near real time. In practice NFV is a journey that takes a while to implement with each phase of its rollout treated as complex projects, all the more reason to devote resources to it now.
Distributed cloud: Worldwide cloud based services revenues are on fire. Telecom operators are late to the game but with good reason. Data processing power needs and low latency requirements meant that cloud requirements in the telecom space were far more stringent than in the enterprise. They had to be carrier grade. Distributed computing using interconnection between dispersed cloud computing systems to enable a topology that can enable profitable next generation services and applications because of its agility and flexibility.
New IP network: New IP is a state of the art virtualized IP network that will power your money making services. And that word money is the reason we like this moniker. New IP is not just a way to talk about equipment but the money it makes. Old IP was just a way to get things done. You figured out how many subscribers to expect, you bought expensive equipment, which managed tremendous transactions stress (Carrier grade) and you rolled it out. The speedier this was the more you’d congratulate yourself on having done your job well.
New IP focuses on usability and works backwards from there. Can the network enable money making services quickly. Does it enable a better customer experience? Does it pass power to the customer via self service? It must be able to do all that. Its not just mobility, cloud and virtualization, New IP is about making content driven services that make money.
An NFV enabled distributed cloud architecture off which roll New IP powered profitable services are how Telecoms will battle OTT content providers. This battle will decide who wins in the new Telecom age.