Open architectures are becoming the new normal for telcos, but many still stick with single-vendor strategies – which surely defeats the purpose of open systems in the first place.
As a CTO, it’s probably heresy for me to say this, but in the telecoms space, software is no longer the differentiator it once was. It’s an enabler and it’s expected to work.
There is a certain irony here, because in telecoms, software is more important than ever. The move towards software-driven and automated companies – all the way from the network edge to customer care – is increasing the importance of software in telcos.
The increase of open source, the rise of open APIs and open ecosystems, and virtualization is making the telecoms software market more open than ever before. This means that what were once considered key functional advantages delivered by software can now be eroded, as competitors can quickly catch up in terms of software functionality. In the BSS space, what were once considered key functional advantages are now considered basic capabilities.
Open, plug-and-play system architectures are becoming the norm. Service providers want to reduce IT and operational costs, but they also need to run their business in a manner that can compete and beat the competition coming from OTTs and everywhere else. To do this, they are asking for agile architectures and collaborative suppliers working as partners. Open architectures enable best-of-breed stacks. This can drive better commercial deals from vendors. This saves money and also gets service providers out of vendor lock-in prison.
This is why I am amazed when I hear C-levels in telecoms service providers say to me, “We’re going fully NFV. All our OSS/BSS and customer engagement systems will be fully open and we’re going to get everything from our incumbent network equipment vendor.”
Open systems + closed shop = no change
Sorry, but you’re kind of missing the point. You’re going from an expensive closed shop system using proprietary systems where the vendor has you over a barrel to an expensive closed shop system using open systems where the vendor has you over a barrel. If you’re going to be open, then take advantage of the commercial and delivery models it can enable.
A lot of BSS functionality is becoming standard. What was yesterday’s brilliant innovation is today’s basic functionality. As telcos become digital first businesses and 5G starts to roll out, the pace of change in the industry will increase. The timescale from a piece of software functionality being considered brilliant to being viewed as basic will decrease.
This highlights another reason why vendor lock in doesn’t work: service providers are all too often dependent on the product road maps and stringent release policies of the vendors. If you’re a large service provider and spend enough money with the large vendor to dictate the release strategy, then maybe that’s ok – but if not, then forget it.
If – and this is a good one – the reason that some service providers are running a single mega-vendor strategy is to have a ‘streamlined’ purchasing process, then when did purchasing efficiencies dictate company survival? Or maybe I should say purchasing inefficiencies, as these RFI/RFP processes can sometimes take over a year. Modern system design now means that by the time a service provider has written a traditional RFI and gone through the shortlist to the even more protracted RFP process, they could have had an open end-to-end digital BSS stack implemented and up and running.
The sheer timescales and costs involved for vendors going through these protracted purchasing processes means that some innovative, smaller vendors don’t even bother responding. They know they’re just in there to make up the numbers and to give the service provider a negotiating tool when trying to get their single supplier to cut their prices (which won’t happen).
Open systems are open for a reason. Having a large stack single supplier with an open architecture means that some service providers are missing the point and are still are the mercy of large vendors’ rigid product release schedules and expensive custom development rates.
Written by Joe Hogan, founder and CTO of Openet
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