TelecomTV had its first “Telco as a Platform” event, and the concept is surely interesting. Of course, these days, we can’t assume that “interesting” means or even implies “helpful”. So, let’s look at the referenced article and see what might have been a hit, and of course what might have been missed. For those who want to look at some session videos, here is the link. There’s also a nice summary on the concept on LinkedIn. In this blog, I’ll look at the concept, and later this week, I’ll review a poll taken at the event.
I’ve been an advocate of looking at new services as something based on middleware and APIs, and I think there’s some of that in the concept of Telco as a Platform. I’ve not been enthusiastic about the notion of operators exposing 5G and other service elements via APIs (which I think the LinkedIn piece would consider “Telco Network as a Platform”, and that’s in there too. I’ve been dismissive of the idea that operators could raise profits by selling these features to others, and that’s also in there. Can we frame something uniformly good out of this mix?
Let’s start by saying that if future services are highly dependent on hosted features rather than purely on appliance/device behavior, then some sort of organized middleware platform is essential, as I noted in a blog last week. Without that, development of features and operationalization of services would be highly inefficient. As I said, I think this concept is within TasaP borders, so why can’t I just say that this initiative is a good thing. It’s the impact of the other stuff.
Any references to extending 5G value (or 6G value) via APIs makes me nervous, because 5G has been around long enough to have demonstrated the value of the concept, if it were real. It has not done so. I think that this point illustrates one of the pitfalls that TasaP advocates are falling into, the notion that third-party innovation (meaning, usually, OTT innovation) is a good way of getting new service revenue without the telco having to get into that uncomfortable space themselves. Yet if you look at the poll taken of the attendees of TelecomTV’s event, I think it’s clear that telcos are looking to have OTTs pull telco chestnuts out of the fire.
The overwhelming majority of so-called new telecommunication services that have come along so far from telcos themselves have been nothing more than billing modifications to existing services. Think of things like turbo buttons and temporary high speed additions to service plans as examples of this. Customers are interested in these things to the extent that they save money for the customer overall which means they’ll lose money for the talk overall.
Says the APIs that are associated with things like 5G or with any other existing service tend to be APIs exposed existing features it’s difficult for these to really change the game very much in terms of the service value proposition. This is why I believe that any attempts to exploit current infrastructure through APIs is doomed to failure. Not only that, these initiatives tend to focus operators on reasonably on the safe step of going forward with the familiar rather than developing the new.
How about something like network functions virtualization or NFV? It’s true that NFC would theoretically permit the creation of new features, features that don’t exist today, is that these features would have to be valuable before exposing them is going to be profitable and it’s not clear that NFV has really demonstrated any such profit opportunity up to now.
If we can’t identify new revenue opportunities associated with telecom as platform can we at least identify cost savings? The answer to that I think is a little bit murky because, up until now, relatively few service elements are actually hosted and therefore susceptible to a platform strategy. First and foremost telecom services are made-up of connectivity and built from connectivity. That means network equipment is still the dominant element in these services. Even if we were to host a few feature elements, as would be the case with something like 5G, it’s not clear that these elements would present enough of a platform opportunity to drive any real change in operations. Making them more efficient call the operationally speaking, would impact a relatively small part of the service.
What would be necessary to make the telco as a platform concept successful? First I think you’d have to be talking about a Greenfield opportunity rather than a simple enhancement to existing services and existing infrastructure. Second, I think you would need a large number of hosted features rather than features embedded in an appliance. Meeting both these conditions would be problematic for two reasons.
The first problem is fear of the unknown. Imagine the telco, who has for decades been building services and infrastructure by connecting devices, suddenly deciding to use a large number of hosted features rather than those familiar tools. That problem is magnified if we’re talking about a brand new service something that is not offered before and which is therefore frightening to them on its own.
The second problem is technical imagination. If we’re going to build a large number of features it stands to reason that those features are going to have common elements and those common elements are themselves gonna have to be exposed as features through APIs. If we were to fail to do this then the building of the features themselves would become operationally and developmentally inefficient. The can a telco, with relatively little service-building experience, possibly anticipate the middleware that would be necessary to create and expose all of these new features?
Here’s a basic and uncomfortable truth. Before telcos could talk about new services based on features, and TasaP to create and support those new services, telcos are going to have to become software-oriented companies and that’s going to take a long time. Ironically, initiatives that try to advance TasaP may actually be hurting the concept, because it’s forcing consideration of a second step before the first step has been taken, or even could hope to be taken.
