In the Cloud, Repurposed BSS Won't Cut It
Caroline Chappell, Contributing Analyst, Heavy Reading
The recent acquisition of startup cloud services enablement vendor ServiceMesh by leading IT services company Computer Sciences Corp. (CSC) (NYSE: CSC) may not be typical Light Reading fare, but it caught my eye, as ServiceMesh is a company Iíve been following for some time now. (See CSC Gains Cloud Management Capabilities With ServiceMesh.)
Not only is its Agility Platform a leading example of a new wave of hybrid cloud orchestration and management systems that have hit the enterprise market in past five years, but ServiceMesh stood out as one of the few startups in this area to be interested in the telecom industry. It turned up at TM Forum's Management World in Nice this year where it participated in a Catalyst, and counts telcos with enterprise cloud plays among its customers: Swisscom AG (NYSE: SCM) is quoted in the CSC acquisition press release.
In a recent market survey I conducted on telco plans for enterprise cloud services, most telcos said they want to reuse as many BSS and OSS systems as possible for managing enterprise cloud services. But just as current OSS installations don't provide the orchestration and management capabilities needed for NFV, operators' existing "heavy" BSS suites, designed to support order-to-cash processes for enterprise communications services with their long timescales for fulfillment, are ill-suited to support dynamic, provisioned-on-demand, enterprise cloud services.
And enterprise customers are beginning to expect from cloud service providers the management capabilities and interfaces available in the tools they are using in their private clouds. This is the advanced functionality provided by a growing number of companies, including: ServiceMesh and its rivals, including RightScale and interesting (but as yet little known) Gravitant; UK startups Flexiant and Abiquo; and mainstreamers Dell and VMware, with its vCAC (pronounced vCake).
Such enterprise customer requirements have been pushing leading telco cloud providers such as CenturyLink Inc. (NYSE: CTL) towards the realization that they need a new management and orchestration layer rather than merely repurposing existing BSS; they also explain why BSS vendors have had limited success to date selling into operators' enterprise cloud services environments.
Among its competitors, ServiceMesh was one of the few enterprise-grade cloud orchestration and management product vendors with the ability and desire to support cloud service providers -- a strategy vindicated by CSC's purchase. There are plenty of enterprise-grade cloud management tools out there but few that address the scale and multi-tenancy needs of telcos. Response to this opportunity from traditional BSS and OSS vendors has been weak. Oracle Corp. (Nasdaq: ORCL) bought Nimbula, which seems to have dropped into a company black hole and is certainly not surfacing on the Communications side of the business (I keep asking). Cisco Systems Inc. (Nasdaq: CSCO) has taken a small stake in Parallels Inc. .
But the situation may be changing. Huawei Technologies Co. Ltd. has a BSS re-engineering initiative for cloud underway with its Business Enablement Suite. And Ericsson AB has re-engineered Telcordia and ConceptWave assets for the cloud: At a recent analyst event, the demo of its coming Cloud Manager looked like a proper cloud management and orchestration system, with the added benefit of carrier-grade features that enterprise tools can't provide.
However, Ericsson has yet to make it entirely clear that operators will need to implement Cloud Manager separately from their traditional Telcordia/ConceptWave systems. Ericsson's move confirms that repurposing existing systems for cloud services won't work. Other BSS vendors should take note.
And expect more acquisitions along the lines of IBM Corp. (NYSE: IBM) and SoftLayer; Centurylink and Tier 3; and CSC and ServiceMesh, as IT and telco cloud service providers square up in the growing market for hybrid cloud. (See IBM Puts SoftLayer At New Cloud Unit's Core and CenturyLink Shows Cloud Is Still Critical.)
— Caroline Chappell, Senior Analyst, Heavy Reading