I’ve said several times in my blog that I’m a fan of the notion of network operators’ providing “facilitating services”. This is a notion raised by AT&T, one I blogged about HERE, and the reason I like it is that it seems to strike a balance between operators’ fixation on providing traditional services and the fact that the revenue per bit for those services is (let’s face it) doomed. The question is what these services could be and how operators would go about offering them. I did a multi-blog series on the technology aspects of facilitating services, but I want to take a step back and look at the properties a facilitating service would have to offer to be valuable. From that, we may be able to derive some tracks that facilitating services could follow.
The first property is broad market utility. Putting it another way, the facilitating services must be targeted at the consumer space, because (as I’ve noted in my blog on Tuesday) business-specific data services are doomed niches. Something targeted there is simply not going to generate enough incremental revenue to make any investment worthwhile. Achieving a broad market utility goal divides into two paths. The first exploits what is already being done online, and the second exploits what is likely to come.
What’s already been done is a mixture of general Internet elements and content delivery elements. In the first category, DNS is already offered by almost every operator, but operators don’t charge for DNS so it’s not much of an opportunity. Same with DHCP. Many operators offer security services for consumers and business, but uptake is mixed because their offerings are usually simply the resale of something available elsewhere.
Content delivery facilitation is another option, particularly mobile content. Current CDN technology works well in wireline/fixed services because current CDN suppliers can peer with the broadband provider at a fixed point. Mobile roaming means that optimum caching may have to be changed depending on where the user is located. However, people consuming video don’t tend to roam far or quickly. In short, this area is currently covered enough that it’s probably too late for operators to jump in.
The second of our areas shows more promise, but also generates more risk. I’ve blogged for years about an area I called contextual services, services that would be designed to integrate applications and information tightly with the life-context of users. It’s probably not escaped many of those who’ve been reading my blog that the “digital-twin” framework I assert is the essential element in the metaverse concept is perhaps a modern basis for these new services.
Any service that’s intended to integrate with the real world needs to know what’s going on there, and needs to be able to organize and reference that knowledge in the way it interacts with the user. That means, IMHO, creating a “digital twin” of those real-world elements that are essential in supporting that interaction, and this is the piece of the metaverse concept that I believe is essential. Other layers build on it, in fact, and that means that a service that supported collection and modeling for digital twinning is a poster child for “facilitating service”.
Speaking of layers, there are opportunities for facilitating services above the basic digital-twinning layer. Most digital twins, especially those that support an individual-subjective service set, would likely reside close to the individual contracting for the service. However, we could say that above the digital-twinning layer is a visualization layer. The metaverse models reality, and how reality should be presented would depend on the nature of the higher-layer service. The Meta concept of a social metaverse is based on creating an alternate or virtual reality, and one attribute of that reality is a remapping of user geographies. A social metaverse creates a shared virtual place whose inhabitants are not sharing a physical location. Other metaverse concepts could have more limited need for “location remapping”, but all require some form of visualization, which is another facilitating service opportunity, and so is the “location remapping”.
A final point here is that digital-twin applications of any sort are likely to be very latency-sensitive, and that favors those who can provide hosting proximate to the inside edge of the access network. Obviously, network operators can do that, and so this point would favor their participation in the application set via facilitating services—edge hosting in this case. That has the advantage of being a very general service, one that doesn’t link the operator to a specific application and take it into competition with OTTs.
In all, some sort of digital-twin-metaverse concept seems to be the best opportunity for operators to target with their facilitating services.
The second of our properties is a close relationship to current operator services. That doesn’t mean voice; there’s no future opportunity there because OTT voice is simply too easy a market to enter. It means current broadband Internet, both wireless and wireline/fixed.
The question here is just what might constitute a “close relationship”. One possibility is that a facilitating service would exploit features of a current service. The feature of connectivity is an example, and it’s probably the most insidious trap of all traps for operators, and so of course they fall into it continually. We have connectivity today, and we’ve built whole industries, maybe whole economies, on the connectivity we have. So what new connectivity feature do operators think we need?
There is a feature that might be useful, though, and that’s the feature of location awareness. Wireline services carry the knowledge of where they terminate. Mobile services carry the knowledge of what towers they’re connecting through. The trick is our last property, avoiding regulatory pitfalls. Selling or even using the specific location of a user is a minefield of public policy issues. The good news is that there’s an alternative.
If lemmings are marching to the sea, versus happily grazing in a meadow, you don’t need to survey lemmings to find out where they’re going; the herd is going and it’s that truth that matters. Same is true, for example, for auto or pedestrian traffic. Do you care who, specifically, is congesting your route, or do you care that your route is congested and that patterns of traffic in and off your route suggest it will clear in twelve minutes? There is value in the knowledge of the broad movements of mobile users.
You could make a similar case for the patterns of usage of calls and the Internet, plotted against location. A given group of people will make and receive a number of calls and texts, and will perform a number of Internet searches. Suppose that activity levels suddenly change radically? Something is going on, and the something is visible enough to change mass behavior. That’s useful knowledge, which means it’s exploitable.
Another possibility is that the deployment of a facilitating service would be aided by real estate and technology associated with broadband deployment. That means, IMHO, that the smarts associated with facilitating services would reside in metro centers where economies of scale and service opportunities would both be high, and latency could be minimized.
The third property is a relatively high first cost and low ROI. Operators want to sell facilitating services at a profit, but their tolerance for low ROIs is higher than that of OTT players. Operators can also accept a fairly high “first cost”, meaning the cost to create a credible initial service over a viable market footprint. A high tolerance for marginal returns on investment is critical if you’re going to offer a wholesale service element and expect to make a profit. A high first cost is critical because you don’t want the retail providers rolling their own features, you want them to buy yours. If first costs are high it discourages those retail providers from cutting you out.
This is a more serious issue than most, including most operators, realize. There’s no point in investing in something that ends up being an attractive paper weight. The person who owns the customer, the retail provider operators are hoping to facilitate, has the most critical asset. That means the operator has to have a counterbalancing asset, and that asset (like the retail customer ownership) comes down to a financial value. You do what the other company needs, what they don’t want to do themselves. Otherwise you’re throwing money away.
The final property is avoiding regulatory pitfalls. Given the second of our properties, any meaningful facilitating service will have to be related to broadband Internet, and that area is fraught with regulatory uncertainty and has been for decades. Operators are justifiably reluctant to enter a service market whose investment is at risk if there’s a change of policy.
Facilitating service goals are easier to manage to dodge regulatory issues for the simple reason that most regulatory policy focuses on what the consumer is offered. However, there is a second-level vulnerability in terms of use and misuse of information.
On the “use” side, there’s all manner of regulations protecting consumer information and privacy. These rules would likely prevent a network operator from leveraging information they had as a result of the customer relationships they supported. If a hacker might want something, you probably don’t want to offer it as a facilitating service.
Relative to “misuse” the issue is that you could expect any facilitating service offered to be examined by malefactors to identify ways it could be exploited. If one is found, the repercussions could be dire if someone suffers financial loss or injury, or if it turns out that some aspect of the service doesn’t pass regulatory requirements.
This issue may be the most problematic for facilitating services, particularly for “digital-twin” services, because by nature these services require a level of personalization, which means they have to know who the user is and something about their life.
I think we could, as an industry, navigate through the issues and create valuable facilitating services, but doing that almost surely starts with recognizing and accepting the concept of a service-level partnership between operators and OTTs, something that’s really not part of the current mindset of either party. I hope that AT&T’s interest, which seems to me to be flagging a bit, is enough to get everyone thinking, at least. The concept, or lack of it, could change networking.
