Light Reading
Metaswitch CEO advises telco customers to transform their business plans along with their networks and become software companies

Metaswitch: Telcos Must Get Soft to Survive

Carol Wilson
5/13/2014
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NEW ORLEANS — Metaswitch Forum 2014 — Telecom service providers need to think of themselves as software companies and behave accordingly, Metaswitch CEO John Lazar told his company's invited audience of service providers here this morning.

A few minutes later, Lazar began to sketch out a few details of how Metaswitch Networks intends to help its customers move forward to a cloud-based, software-centric, all-IP future at the pace they themselves set. But more on that later, as the news trickles out here.

Moving to a software-centric approach is important for getting new services to market more quickly and thus addressing the revenue crunch telcos face today, Lazar noted. Those aren't new themes for the Metaswitch crowd, which includes many smaller telcos who have watched their voice revenues erode and pressure to support greater bandwidth for data increase exponentially without any real revenues attached.

Some of those listening may have been more intrigued by what Lazar said next: that thinking and behaving like software companies in the way they address network transformation and business plans will also help telcos become more valuable and potentially attract more investment.

"You only have to look at Whatsapp, which sold for, what, $19 billion," Lazar pointed out. "Investors both private and public like companies that use software smarts to cut costs, increase revenues, drive innovation, and become more open and agile. So it's not just about the technology in the network; it's about your value."

That's interesting thinking for a market that has been battered by the loss of federal subsidies, in addition to the loss of traditional revenues. The message may be intended to get the attention of telcos who might think the current transition to virtualization through SDN and NFV isn't yet relevant for them. Because it is.

— Carol Wilson, Editor-at-Large, Light Reading

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Kevin Mitchell
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Kevin Mitchell,
User Rank: Lightning
5/15/2014 | 7:42:40 PM
Re: Switching me softly for a song
Seven,

I'm not sure I see your point. Some networks functions lend themselves to virtualization in the network or outright cloud sourcing to another provider.

Voice is an app, abstracted from other parts of the network. It's not an all or nothing approach for cloud. I agree that some functions don't yield to virtualization (today or maybe ever).

POTS line you don't virtualize. That's hardwire stuff. It's dead. Voice is bits and packets delivered from a cloud platform running on x86 servers connected to an IP network and delivered to a device over any broadband network.

Cloud Voice Platform

 

 
brookseven
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brookseven,
User Rank: Light Sabre
5/15/2014 | 6:53:48 PM
Re: Switching me softly for a song
Kevin,

So how do you offer Dark Fiber service over that network?

See the point?  You are taking a single slice of the network and saying "Hey NFV me."  What I pondering is that this may yield little for a carrier.  They still have a whole ton of things to virtualize and some of them don't yield to virtualization.  Hard to virtualize a POTS line.

Which is VERY different than in the IT infrastructure which is essentially x86 based computers connected over Ethernet/IP/TCP networks.  So, most if not all functions are VMed or VMable.

So, not sure how you virtualize a Media Gateway with POTS on one side of it.  But have at it!

seven

 
Kevin Mitchell
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Kevin Mitchell,
User Rank: Lightning
5/15/2014 | 4:36:55 PM
Re: Switching me softly for a song
@brookseven

We say don't just virtualize the media gateway (which vendors want to still sell you as hardware anyway), VAPORIZE the network. Use the cloud for Voice Network as a Service (i.e., the cloud voice platform).

Alianza isn't the only company pushing this way. Look at BroadSoft with BroadCloud and GENBAND with Nuvia as box selling vendors moving to a SaaS model.

Most vendors want you to buy their new something (all software nowadays). Well, given what's available, some networks just don't need to be rebuilt. They should be cloud sourced.

Momentum for Cloud Voice Platforms in 2013

Next Generation Voice Platform – Leaping From Network to Cloud

Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/15/2014 | 2:07:30 PM
Re: Switching me softly for a song
Oh, I agree others will follow suit. And what we saw in the IT industry is that the other companies tear themselves apart in the effort to try to follow the leader. For them, the cultural change doesnt help; it simply accelerates their decline. Leaders seeking change inside the company fight against others looking to preserve the status quo. 
Liz Greenberg
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Liz Greenberg,
User Rank: Light Sabre
5/14/2014 | 9:04:52 PM
Re: Switching me softly for a song
You are right @Phil and @Mitch as well.  This will be a monumental change for these organizations but it will either be evolve or go the way of the dinosaurs.  I am not one to suggest throwing away the baby with the bathwater so evolution may be slow and deliberate but it still must happen.  The end result will still be some sort of hybrid of dedicated hardware and general purpose, software controlled hardware but it still must happen.
Phil_Britt
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Phil_Britt,
User Rank: Light Sabre
5/14/2014 | 4:38:09 PM
Re: Switching me softly for a song
I agree it's hard to pull off -- just ask the several companies that failed because they didn't make cultural shifts to stay relevant. I'm just saying that it only takes one company to make such a shift and succeed, and others will try to follow suit.
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/14/2014 | 3:46:13 PM
Re: Switching me softly for a song
Phil Britt - That kind of cultural shift is hard to pull off. It's deep in the company's internal organs and DNA. Even failing companies that see competitors succeed with a changed culture have difficulty making the change. 

Companies are comprised of individual people. And a company's top executive ranks are by definition comprised of individuals who have succeeded under the status quo
brookseven
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brookseven,
User Rank: Light Sabre
5/14/2014 | 12:03:54 PM
Re: Switching me softly for a song
Carol,

In the spirit of debate, I would like to challenge your statement.  Mostly to see if we can liven this up and get Phil to jump in with a Metaswitch counterpoint.

So, if you are switching to NFV for something you already do then I have to ask a question:  Does the VM version of the product replace exactly the existing solution? 

Let's use Metaswitch as an example:  Can I Virtualize the Media Gateway (of course not)?  From a carrier standpoint, this means that like any other solution there are both gains and losses from the conversion to VMs.

I would propose a different way of looking at this.  The reason that VMs work so well in the Web world is that there is a set of Universal Languages.  HTTP, URLs, TCP/IP, etc.  End systems source these languages and the network processes them.  

In the data center world, everything is connected via TCP/IP over Ethernet (of some form or another).

If this is going to work, I think we need to think of all things as exchanged in these basic format.  The challenge is that this means that things like MPLS networks need not apply (just as an example). 

I think this is going to be really challenging for telcos as they try to bridge their silos between their different businesses.  One or more will adopt separate NFV/SDN implementations for different purposes.  And the silos will continue and that any gain is minmized.

seven

 
Phil_Britt
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Phil_Britt,
User Rank: Light Sabre
5/14/2014 | 11:24:33 AM
Re: Switching me softly for a song
You're right about the cultural shift that would need to be made -- something telecom companies have had a hard time doing for several years. But these companies are largely "me, too." Once one announces a sharing plan, they all have it. Once one offers unlimited data, they all have it. Once one raises or lowers prices, they all do it.

So once one adopts this type of culture -- and is successful with it -- they all will.
Mitch Wagner
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Mitch Wagner,
User Rank: Lightning
5/13/2014 | 1:47:05 PM
Re: Switching me softly for a song
I've heard this exhortation to become software-focused at least once before. It seems to be a popular theme at carrier conferences. The shift requires a deep and fundamental cultural change from hardware-focused to software-focused, which will prove overwhelming to many organizations. 
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