What are the biggest challenges facing traditional communications service providers today?
Well, they need to:
- find new ways to grow revenues, by developing and successfully selling new services and products;
- cut costs;
- develop and offer new services to market quickly (so, MUCH quicker than they're capable of right now); and
- come to terms with the fact they're no longer the only source of real-time, multimedia communications.
A tough list. And while new technology can help service providers meet some of these challenges, it's only a small, though very important, piece of the pie.
The biggest piece of the pie, and the one that's going to be the hardest to swallow, is organizational, and relates to the operators' main asset -- their staff.
Historically (and currently, in most instances), service providers have organized themselves into teams that, while (supposedly) pulling in the same direction to the overall benefit of the company, have operated within their own confines -- in silos -- with very little, if any, interaction (even when it made sense).
Now, if those service providers that have relied on mass-market voice and enterprise connectivity for their revenues stand any chance of survival and becoming true next-generation service providers that can compete with the likes of Apple, Amazon and Google, that needs to change.
Here at Light Reading, we believe that service providers need to make a fundamental change to the way they're organized if they have aspirations to be more than just utility bit pipes -- they need to bring their networks and IT teams together as a single, integrated unit. This process -- the integration of these related but disparate teams -- is something we're calling Bridging the Chasm. That's because the divide between the two teams currently is wide and it's going to take a lot of hard work, organizational skills and sheer bloody-mindedness to bring them together.
It's a tough task but it's essential.
More than ever before, the networks and IT teams need each other. For almost the first time they need many of the same skills, need to be able to understand the same technical languages, and be able to communicate with each other. Communications service providers need to adapt to an IP-centric world where delivering a great customer experience from the moment a customer makes initial contact and then throughout their engagement (whether that's for one minute or 30 years) is absolutely critical. And that can't be achieved to scale and in real time unless there is true coordination and understanding between what are currently separate teams.
That applies equally to the challenge of developing relevant new services and products that people will want to buy. It's universally acknowledged that service providers need to work with third-party applications developers, and Heavy Reading research has shown that most operators recognize this as an essential relationship to build. But enabling that relationship means the operators need to create an automated process, involving networks assets and back-office software (billing, subscriber data management, provisioning and so on), that enables the developers to build, test and deliver the new applications. That can't be achieved in any meaningful, productive and profitable way in an environment where phrases such as "that's the billing team's problem" or "that's nothing to do with us -- it's a network issue" are commonplace.
Closely linked to this need to bring the two teams together is the increasing reliance by network operators on their Service Provider Information Technology (SPIT) assets, something we highlighted in 2010, starting in February when we published The SPIT Manifesto. Essentially, communications service providers are increasingly reliant on their SPIT assets to remain competitive and enable their transformation from legacy carrier to next-generation service provider, and now they need to bring the networks and IT teams together so they can best utilize the capabilities inherent in those assets. The IT team alone can't deliver the required transformation on its own, and neither can the networks team.
Some operators have already taken some of the first steps towards Bridging the Chasm. One such step is to put a single executive in charge of networks and IT -- in other words, to have a joint CTO/CIO. UK operator BT Group took this step in mid-2009 when its then CTO Matt Bross left the company and his responsibilities were handed on to the then CIO Al-Noor Ramji. These days, Clive Selley is the executive in BT's Bridging the Chasm hotseat.
One operator has even managed to bridge the chasm from day one, and never have disparate network and IT teams. Nucleus Connect, the operator that's running Singapore's next-generation national broadband network, has had a combined team from day one. The company, though, was only formed in the first half of 2009, so it avoided any legacy issues, and is relatively small. However, the management team had the foresight to build a single technology team, and it has paid off, according to CEO David Storrie, who says the networks and IT folk hired to work together at Nucleus Connect have been learning from each other and identifying new ways of doing things more efficiently.
Storrie's story (if you'll pardon the phrase) will be the exception, of course. For most operators, Bridging the Chasm will be a Herculean operational challenge, but one that, we believe, they will have to undertake in one form or another. Some may opt to outsource the running of all network and IT systems to a third party, though that would be a move equally fraught with difficulties.
We expect, therefore, to see more and more operators take initial steps along the same lines as BT and gradually transform the way they run the very heart of their business operations. And we intend to track and monitor those strategies, plans and projects, and talk to the relevant people along the way about their goals, challenges, gains and failures. We think there will be plenty of each.
This is a transformation that will take years, and one that will involve a great deal of learning and sharing amongst the carrier community. We aim to be a part of that sharing and learning experience. That's why today is Day 1 of Light Reading's Bridging the Chasm editorial campaign, and we're opening with a message to communications service providers around the world: You need to do this -- let Light Reading's campaign, with its aim of sharing experiences and raising awareness, be a part of your process.
â€” Ray Le Maistre, International Managing Editor, Light Reading