The advent of 5G is pressuring communications service providers (CSPs) to transform their legacy IT in order to succeed in a virtualized, software-based world. However, in order to make this transition quickly and cost-effectively they need the support of the vendor community.
Supporting an Open Digital Architecture
Last week, that support came through when Amdocs, Netcracker Technologies, Nokia and Oracle Communications agreed to adopt the collaboratively developed Open Digital Architecture. This new approach to building software to run service provider businesses creates a market for innovative, standardized and interoperable software components, enabling the industry to invest in IT for new and differentiated services instead of customization and integration. (Read: Flying towards a globally standardized architecture and “A Future Vision for the Software Market the Telecom Industry Needs to Survive and Thrive.”)
Nik Willetts, CEO, TM Forum recently sat down with the Forum’s CTO George Glass, and industry leaders Brendan O’Rourke, Expert Partner, Enterprise Technology, TMT Practice, Bain, and Thierry Souche, Group CIO, Orange, to discuss how CSPs can rethink their own operating models, processes, pace of decision making and more..
The insight below feature snippets of what they had to say. Watch the full video in this article, and register for future Hard Talk debates here.
What are the industry’s biggest challenges?
Souche: “Our IT stack did not evolve at the same speed [and] pace as market requirements, and we now face a situation where we keep doing IT in the same good old way, while the market is expecting something quite different.
“We actually need to be able to go much, much faster. We need to be able to focus much less money on what works and does the job, much more money on innovating things, on data, on analytics, on better understanding and serving customers.”
O’Rourke:“[The telecom industry’s] core margins and revenues are declining. As an industry we need to change very, very rapidly. The competition is coming and I think we need to see the shift … about where we invest, and [see it] within the next three to five years if service providers are going to partake in the new revenue streams generated in this dynamic market.”
How is the pandemic affecting busines?
O’Rourke: “What I think we’ve seen in Covid-19 from an industry perspective is a sort of stopping of trading. If you talked to many in the industry, new account churn has basically stopped, and handset sales have declined rapidly. But on the flip side, we’ve seen this shift to digital, people are more willing to transact on the digital systems and looking for that very simple, easy experience.
“The opportunity potentially now, is to embed some of that shift to digital in your ways of operating, and not necessarily just restarting all the call centres and reopening all your retail stores.”
What is the Open Digital Architecture and how is the different from traditional OSS/BSS?
Glass: “The ODA [Open Digital Architecture] is a modular component-based architecture that exposes its business functionally via a set of open APIs. At the TM Forum, we’re actually creating machine-readable assets; downloadable API’s and downloadable components that actually get you up and running very, very quickly.
“The concept of the ODA is that it’s modular and componentized, so you don’t have to change [your entire IT system] at once – you can change bits of it. [This allows] CSPs to invest in innovative change, as opposed to rebuilding something that they already have.”
How is IT transformation different than transformation of another part of a CSP’s business?
Souche: “IT is actually a little bit of a different beast because we are much, much more adherent to the business and there are no two businesses alike. When you take two different countries, the markets are different, the competition is different, the pace of price points, everything is very different.”
How do you explain the need for digital transformation and the ODA to a CFO?
O’Rourke – “When I talk to businesses about digital transformation, there is a little bit of fatigue of large digital change programs [that are] dependent on millions of pounds of investment into IT. We need to use this architecture to explain to CTOs and CFOs that actually the right way to deliver it is in small steps. Delivering value, but at a pace – in individual steps that allow you to test whether it’s been successful or not as you go along.”