2019 saw the foundations for change. 2020 will see the implementation of strategic change programs in the industry.
Last year at MWC the quote of the conference surely had to go to Vodafone Group CEO, Nick Read. When speaking at the keynote session he gave a forceful view on the status of the mobile industry at the start of 2019.
“Our reputation with consumers is just ahead of the tobacco industry, and in Europe the operators only have themselves to blame for the activities of the regulators given the protectionist approach that has been adopted.”
This was a call for change in the industry. Read continued by looking at the huge potential for operators by explaining that:
“The mobile telecoms industry is the enabler for digital transformation, and we’re operating in the ‘sectors of sectors”. He concluded his keynote address with a rallying cry for the industry: “What I would like is a new contract for the industry. I want to go out and build trust with consumers and businesses. I want to move our industry into a different space in the eyes of consumers, regulators and governments. That will also require that we engage with governments to really build the vision of a digital society and how we can accelerate societal and economic prosperity together.”
Nick Read is not alone in calling for, and developing strategic change programmes. Many of the world’s largest operators see the need for change and are implementing large scale, strategic change initiatives.
In an interview with the Financial Times in November 2019, Telefonica CEO José María Álvarez-Pallete said that the change in the industry is “driven by a belief that time is up for the “traditional formula” of telecoms — selling smartphones and contracts to millions of customers”, and that Telefonica must change from a traditional telecoms company into a technology business.
Also in November at the GSMA Mobile 360 MENA conference in Dubai, Hatem Dowidar, CEO of Etisalat International called out the industry change that 5G can deliver.
“5G is our opportunity for operators to take the lead and keep as much of the value as we can inside the telecoms industry. As operators we invest a lot in this and 5G is a great opportunity. While in previous generations we have been disrupted by other markets, we now have the potential to disrupt other industries and have the potential to grow our own industry”.
One month later in December 2019, Orange Group announced their strategic growth plan called Engage 2025. Stéphane Richard, Chairman and CEO of the Orange Group said of Engage 2025:
“To support this growth ambition, by 2025 Orange will have to reinvent itself and adapt to a constantly changing world. Artificial intelligence and data will be at the heart of this reinvention, both to improve customer experience and to make our networks smarter and the whole company more agile”.
Change is happening is our industry and it’s happening at a rate that’s unprecedented. But there’s no golden bullet and what works for one operator may not work for another. Orange has done extremely well with Orange Bank. In the first two years of operation Orange Bank has gained 500,000 customers and is planning to have 5 million customers in Europe and 10 million customers in Africa by the end of 2023. However at the Light Reading 2020 Vision Executive Summit, Light Reading announced the results of an operator survey where only 12% felt that telcos should become banks. A resounding 88% feel that telcos should steer clear of becoming banks.
There will be no-one size fits all change strategy that guarantees success.
The key is for operators to be a lot more agile and be able to try out new services and business models, without massive up-front capital investment which increases the risk. In order to turn telecoms change strategies into business realities, the change must be as easy as possible and the risks and pain for change minimised. This involves giving people a choice and using open and cost effective technology to provide the foundation for change.
In the digital and 5G BSS world we know that not all operators are the same so there are different options for implementation of systems. The key here is to make the change as risk and pain free as possible. These options include:
Co-development: For some larger operators who may have unique requirements there is the co-development option where we provide development teams to work alongside the operator’s IT development teams. Using DevOps in a CI /CD (continuous integration / continuous development) environment the team use a library of core product microservices as the foundation for development.
New digital stack: There’s an emergence of digital first, sub brands being launched by operators. These are set up an separate divisions of the operator and will implement a new end to end digital business platform (OSS/ BSS) on a greenfield site. Using Open APIs we work with partners to provide a full end to end digital suite covering all functions from charging to billing and policy to web based CRM and experience management. With no legacy integration or data migration these end to end digital stacks have been implemented in less than 100 days.
Adjunct systems: Often an operator knows they must change their BSS but the thoughts (and cost) of a billing system migration delays the necessary action. What we’ve seen work extremely well is adjuncting digital and 5G systems onto legacy BSS. A good example of this is overlaying an existing legacy billing system with a real-time charging system. All traffic is collected and rated in real-time by the charging system, and then rated CDRs are sent to the legacy billing system for billing.
Replacement systems: Some operators are running systems that are facing end of life, or just aren’t designed to cope with digital and 5G services and these need to be swapped out. This involves data migration, so having the automated toolsets to enable this and the track record of delivering successful migration projects is key here.
In order to ease change for BSS, using any of the four options listed above, it’s important that digital and 5G BSS are cloud-native, use open APIs and are microservices based. These are basic building blocks for digital and 5G BSS, and are important to enable the change that all major operators are implementing in 2020.
Martin Morgan, Vice President, Marketing, Openet