If you were a passenger on the Titanic, you might have had (for a time) a great interest in stories about lifeboats and rescues at sea. If you’re a telco, you might have had similar interest in stories about “opportunities”. Stories wouldn’t have helped those passengers so long ago, and they won’t likely help telcos either, but we still have to examine them for the latter group, at least. So, we come to a Fierce Network piece that quotes the head of Amazon’s telco unit, Ian Hofmeyr. “Telcos are newly excited about AI, especially for speeding up modernization,” it says. If they are, should they be?
The main focus of the piece is “modernization” of current software, something that’s talked about by every single vertical and every single enterprise I’ve chatted with over decades. With telcos, it focuses on OSS/BSS systems, which is their core business application set. Telcos are in fact talking about OSS/BSS modernization, but they’ve been doing that for decades, too. I was in a meeting with the key tech planners of a big US Tier One about fifteen years ago, and the guy on one side of me at the table was in favor of modernizing OSS/BSS, the one on the other side of totally scrapping them. Neither got done, so why now? That’s the question we need to be looking at here.
The biggest driver of application modernization (“appmod”) is cloud computing. While very few enterprises have moved everything, or even most things, to the cloud, nearly all have adopted the cloud as a way of applying elastic resources to an essentially elastic problem, which is how to support customers, prospects, and partners with access to some core business data when this usage is highly variable. This front-end stuff is what’s changed in the OSS/BSS game, versus the past modernization goals.
Obviously, an AWS telecom guy would be focused on AWS, meaning on cloud hosting of something. What I think has developed recently in the telco world is a mirror of what happened in the enterprise IT space over the last couple decades. The transition of the relationship between core applications and users changed because of the Internet. If you’re going to reach out to customers directly from your software rather than through an employee agent, you need to create a customer-friendly portal, one that reflects the geographic and technology-experience breadth of that space. The variability in demand makes self-hosting this portal inefficient, so cloud services make sense. Telcos are finally getting that, so they’re reflecting the cloud-front-end-think in their OSS/BSS planning.
I have heard about just under two-dozen telcos who are somewhere on the journey this new recognition implies. None of them see this as a journey to AI, and only about a third see AI as more than a potential tool in migration. The reason is complicated, but interesting.
Most enterprises have built core applications themselves over the years, and so they have to consider the question of how they adopt front-end portal technology in the cloud when their core applications are old and monolithic. Some enterprises have indeed looked at broadly modernizing the stuff—the whole “appmod” trend of the 2010-19 decade is a good example. Most have elected to simply create an interface into/with core applications rather than try to do any sort of massive transformation.
Telcos are both different, and the same. Most telco OSS/BSS systems are third-party software with some layers and shims to customize their behavior to each telco’s operating requirements and regulatory frameworks. They are, to a degree, dependent on the progress of their OSS/BSS vendor in prepping for cloud portals. In addition, telcos are service companies, and a service company is different because what their core software is doing is managing an ongoing relationship set, not a series of independent sales. It’s more challenging to transform service management than sales.
In any event, modernization of any sort runs into a problem I’ve seen for decades, best explained by a comment I had from a CIO. “Conversion projects are the worst projects you can propose. They’re all cost and no benefit. The best you can hope for is that nobody knows you ever did anything.” The fact is that the business case for OSS/BSS transformations has always been hard to make, as THIS piece shows well.
The relationship between AT&T and AWS, cited in the first of my references, shows that a hybrid-cloud model, with premises-hosted but cloud-compatible elements, is a good way to create a front-end portal. AWS Transform, a generalized tool to manage appmod projects, is a help in such tasks, according to both enterprises and telcos, but neither group has told me they expect it to help them make a business case.
Another point is that, so far, no telco has indicated that OSS/BSS modernization has a significant impact on the bottom line. That doesn’t mean that there’s no value there, just that it’s a bit of an ordeal to get much backing for the project. The piece from Passionate About OSS/BSS asks “Why are transformation approvals (eg business case approvals, vendor selections, project transformation decisions) forced to look perfect when delivery is anything but?” Sadly, business cases always have to look as good as possible or they won’t get approved, and most of them suffer from execution deterioration. But the same piece notes that OSS/BSS transformation projects often fail “because stakeholders expect certainty and perfection, so transformation leaders feel forced to model uncertainty as certainty.” That goes back to my old CIO quote.
Which, to me, means that Hofmeyr saying “I’m starting to see leadership coming into telco that have absolutely zero tolerance for that and are driving the right outcomes…I really feel there’s a shift,” may reflect more wishful thinking than realism. I don’t think that telcos really see AI as an opportunity, not to use it or to sell it, if one defines “opportunity” as meaning “something that can make a business case.” I do think that most are hopeful on both counts, for the same reason that those Titanic passengers were hopeful; the alternative to hope was despair. Something needs to be done in the world of telcos, on the cost side and on the revenue side. Could AI play a role? I think so, but then telcos have refused lifelines thrown to them in the past. Will this one be handled differently? I wonder.
