Transformation’s useless unless telcos transform into partners

digital partners
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Telcos desperately need to undergo digital transformation to stay relevant in the digital era, but that doesn’t mean just becoming digital telcos – they must become digital collaborators as well.

That was the overarching theme during the opening keynotes at the TM Forum’s Digital Transformation Asia event on Tuesday in Kuala Lumpur. And it’s an argument TM Forum CEO Nik Willetts put forward in his opening address, in which he stated two key facts: digital transformation is crucial for the telecoms sector, and telcos generally are falling behind the curve.

Willitts highlighted the various tools, initiatives, maturity models, open APIs and open architectures the forum has developed or spearheaded to help telcos along, but emphasized that transformation isn’t a technology issue so much as a human mindset and skills issue.

The end game for telcos should not be to simply become digital versions of themselves, but to transform into digital partners, Willetts said. “Success in the digital world requires collaboration and learning how to work together.”

Collaboration capabilities will be especially crucial if telcos are serious about targeting vertical customers for services like connected cars, smart factories or healthcare, where the real challenge isn’t technology but understanding the customer’s needs, Willetts said. “The auto industry is likely to have a very different view of what they need than our own view of what they need.”

Telcos went through that particular trial by fire in the early days of IPTV, for example, when it came to negotiating content deals with content providers and broadcasters, who had a completely different set of priorities in terms of content licensing and revenue sharing.

Montgomery Hong, CIO of Telkomsel, showed in his keynote how far telcos have come since those days. According to Hong, Telkomsel has essentially transformed itself into a platform partner through which it has forged partnerships for video, music, games and payments. Telkomsel offers its own branded services for each, but has forsaken the ancient walled-garden approach for partnerships with competing services.

Hong also explained how Telkomsel has positioned itself to play a role through the entire video ecosystem, from content creation to payment, adding that in each case it still must work with partners – particularly for CDNs and content hosting, which requires cloud computing expertise.

The overarching philosophy is simple: “The telco’s most valuable asset is not the network – it’s the platform,” he said. Once services are decoupled from the network – which is to say, you don’t have to be a Telkomsel mobile customer to subscribe to its digital services – that’s when you unlock the real monetization opportunities.

Anthony Rodrigo, group CIO of Axiata, focused more on the API side of the equation, explaining how Axiata migrated from opening its external APIs to target long-tail and short-tail developers to opening its internal APIs (for the core network, BSS, enterprise IT and digital services) to internal developers, business units and internal suppliers.

“Every asset in our backyard can be API’d,” he said.

This has created an internal marketplace of over 2,500 APIs (vs just over 100 external APIs) that has started to feed into its external marketplace, while its external partners have had their own influence on Axiata’s internal API culture and innovation.

Rodrigo added it’s not quite as simple as he makes it sound. “It’s a journey that requires lots of top-level commitment – and patience – and a well-empowered CIO.”

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