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Telecom Italia Plots Digital 'Overlay,' Not Transformation

Iain Morris

Telecom Italia has said it will be impossible to overhaul its existing back-office systems and that it plans to use an "overlay" to support the rollout of new software and virtualization technologies.

Like other telcos, the Italian incumbent is trying to automate and "digitize" parts of its network in response to changing customer requirements and in an effort to gain web-like efficiency.

Having indicated earlier this year that digital transformation was proving enormously challenging, Telecom Italia SpA (NYSE: TI) says it will continue maintaining its legacy operational support systems (OSS) alongside an overlay in a kind of hybrid environment -- where both physical and virtual network functions (VNFs) will be in use. (See Telecom Italia Not Ready to Transform, Admits Exec.)

"We consider it is not possible to transform our current traditional OSS because there is too much complexity," said Alessandra Pavese, Telecom Italia's head of network evolution, during a presentation at Huawei Technologies Co. Ltd. 's recent Ultra-Broadband Forum in Frankfurt, Germany. "It is a nightmare to transform this and so what we are looking at is an overlay network where we will onboard virtual network functions."

Exactly which network functions are to be virtualized will depend on an assessment of business requirements, according to Pavese.

The decision seems pragmatic, and not unusual, given the difficulties of virtualizing a large number of functions in a short space of time, the immaturity of the technologies in question and the resource limitations within the Telecom Italia organization.

"This means a portion of our network will move to this automation framework and other network functions will still be managed by the traditional OSS," said Pavese.

Various other telcos also appear to have abandoned ideas of jettisoning legacy back-office systems and shifting all their services on to new digital platforms in one go, although Pavese's remarks suggest older systems may have a longer shelf life at Telecom Italia than elsewhere.

While it has not provided detailed plans for a shutdown of legacy systems, or given a timeframe over which this could occur, Telecom Italia is evidently keen on ditching older technologies where possible.

"We need to decommission to optimize costs and speed up the onboarding of virtual network functions and our cloudification," said Pavese.

A major challenge for the company is to ensure that staff have the requisite software skills and are able to function in more of a "DevOps" environment -- typically associated with the working practices of the web-scale Internet companies -- than using the "waterfall" processes to which many have grown accustomed.

With a waterfall approach, software design and release tends to happen in a highly structured sequence. In a DevOps culture, by contrast, development takes place in a less formalized, more flexible manner and as products are being introduced into the market.

For more NFV-related coverage and insights, check out our dedicated NFV content channel here on Light Reading.

Ultimately, investment in the overlay network is aimed at ensuring Telecom Italia can take advantage of new service opportunities -- especially in the enterprise sector, where interest in the potential of network slicing and network-as-a-service (NaaS) offerings is growing fast.

Typically associated with the rollout of 5G, network slicing would allow an operator to provide a variety of highly differentiated network services over the same infrastructure. With NaaS, meanwhile, business customers would be able to activate service capabilities on demand and according to particular needs and circumstances.

"We are working hard with the business marketing department to define new use cases and want to make self-provisioning possible and allow customers to manage the service lifecycle and activation of services," said Pavese.

In March, Michele Gamberini, Telecom Italia's core network and infrastructure director, said the operator had already deployed network functions virtualization (NFV) infrastructure at two points of presence and was planning to set up an additional two sites this year.

That process is set to continue in 2017, when Telecom Italia also wants to begin virtualizing its radio access network and deploy an NFV orchestrator.

— Iain Morris, Circle me on Google+ Follow me on TwitterVisit my LinkedIn profile, News Editor, Light Reading

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User Rank: Light Beer
10/23/2016 | 1:50:07 AM
Re: Running the numbers
As TI are looking now for core functions virtualization (EPC, IMS, DNS etc.) and less on customer device virtualization, it can be alongside traditional OSS with no changes.

so actaully the stack is not hybrid, each function is standalone in its doimain and communication to the phsycial network is traditioinal IP (by SDN GW), not chaining inside the SDN.

Actually for thise functions, SDN is not even required, plain Openstack can serve well with pre-defined/orchestrator define networks
Joe Stanganelli
Joe Stanganelli,
User Rank: Light Sabre
10/17/2016 | 4:18:46 PM
Re: Running the numbers
I'm not sure that that is necessarily true.  The need to upgrade is one thing, but growth potential in all directions requires total ownership.  Maybe they have bigger things on their mind in terms of expansions.
Joe Stanganelli
Joe Stanganelli,
User Rank: Light Sabre
10/17/2016 | 4:17:25 PM
How old/"legacy" are we talking here for TI's OSS system?  Like, 5-8 years?  Or like 11-18 years?
User Rank: Blogger
10/17/2016 | 1:36:55 PM
Running the numbers
I assume Telecom Italia has run the numbers on this and thinks it will be the best financial strategy. But at some point won't the complexity of running a hybrid back office become more painful than a switchover?
User Rank: Light Sabre
10/17/2016 | 9:19:11 AM
Why walk when you can crawl?
Incumbents believe they can take their time with network transformation if they are confident that they won't be facing any meaningful competition. That's "pragmatic" to a point, but what that strategy doesn't address is that their businesses become less and less profitable and less and less interesting to the money people.
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