Businesses, big and small, have harnessed telecom technologies to get to the next level of productivity. The next stage now in this accelerated evolution is to equip every aspect and function of business (logistics, manufacturing, delivery of services, and so on) and every end point (device, systems) with even more information and communications technology (ICT) enablers.
The recent rapid advancement of key telecom cloud technology areas has further accelerated this promise, and created architectural flexibility for service providers to address the enterprise markets. As a result, 5G business cases are increasingly dependent on success in "verticals", private networks for businesses are the flavor of the day, going up the IoT value chain is a daily discussion topic in service provider strategy rooms, and the level of enterprise customer workloads that can be deployed to the "edge" are being hotly debated in service providers’ technical sessions.
Today, we in the communication industry are loving every advancement in automation of factories, railways, utilities, and health-care, many of which are now possible with these new developments.
Of course, these advances have attracted the big boys of software and IT cloud into the telecom space. The landscape is being transformed by their ability for deep investments and their cloud technology capabilities. Service providers are therefore attaining new options in how to play in the enterprise (large, as well as SMB) markets and there is a complete "reboot" in thinking around the telecom operator-enabled enterprise market.
There are lots of choices to be made, and questions to be answered:
- Who does the service provider want to be in this enterprise market space?
- Who should they partner with? How many partners should they work with at the same time?
- Do they make technology choices first or market choices first – what’s the right sequence?
- How far should they go up in the vertical stack?
- Are there common foundational technologies to invest in while the market settles?
- Will the benefits come to the service provider, or will they go to the application providers like it did with mobile payment, or OTT players?
In a nutshell, with the plethora of choices and the associated flexibility of redefining a service provider's role in this "rebooted" enterprise market comes confusion and the potential waste of an investment. This blog post seeks to take a current snapshot of this rapidly evolving marketplace and in a very simple framework, which looks at the eight decision criteria and three types of industry partnerships that a service provider may need to consider as it redefines its enterprise play and commits with a significant amount of money.
The eight decision criteria for the service provider to consider when selecting partners for its value chain to address the "rebooted" enterprise market are:
- Service offering control – the ability to define service offerings for the market by the service provider by making changes to the network, adding flexibility to their current operations and defining the enterprise offering specific to its own market.
- Industrialization – the ability to scale (and do it repetitively with minimal changes) the cloud technology-enabled plays for enterprise, be it for private networks, or "edge" optimized offerings for specific workloads.
- Standards alignment – compatibility with well recognized industry standards driven by the telecom industry, be it 3GPP, European Telecommunications Standards Institute (ETSI), or the Open Network Automation Platform (ONAP).
- Integration to existing investments – the ease of integrating the new enterprise play offerings to existing investments in telecom technologies, support systems (what was called OSS/BSS) and existing processes for running operations (core network, field, call-center); in short, the ability to get a continued return on past investments and ways of working.
- Level of customization – the ability of the service provider to accommodate the needs of the enterprise customer for application, performance, reliability, service level agreements that differ vastly by industry. This can come down to regulations for a geography, and for large companies in particular, the need for integration to their (enterprise customer's) internal legacy systems and processes.
- Ability to attract developers – to build enterprise offerings on service provider technology, or factors that are compatible with their offering.
- Reach into the enterprise customer – the ability to reach out to key stakeholders beyond telecom access/phone buyers in enterprise customer environments, speak their language, solve deep business problems and understand their latent needs.
- Enterprise application attachments to offering – the ability of the partner to provide relevant enterprise application (workforce management, field services, business analytics, vertical specific, logistics management, video processing, and so on) to add to the telecom offering "stack" from the service provider.
The three types of industry partners:
- Hyperscalers – Google, AWS and their equals in Asia that deploy cloud technology at scale. They have strong IT cloud workload expertise which is now being rolled out into the telecom industry; they often use specialized IT and network hardware and software technologies to achieve scale and efficiency.
- The big enterprise software houses – These have huge enterprise customer knowledge and strong enterprise cloud plays. They’re seeking to create new offerings for the telecom industry.
- The network equipment players – Ericsson and its rivals that understand the service provider world deeply, and are trying to enable them for the enterprise market "reboot" with deep changes at the heart of the network (core, access flexibility using cloud technologies).
The service provider is at the center of this cloud tech-enabled enterprise play universe. The way each major service provider chooses its partners for selected and additional capabilities will require strategic dexterity and a careful layering of compentencies – both internally, build by the service provider, and in the selection of the right partner. The power to shape the outcome of this market is with the service providers, but so is the responsibility for the choices they make. Stay tuned for more in part two of this blog post.
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