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Ericsson Boards Its Own BUSS

Ray Le Maistre
2/21/2012
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Ericsson AB (Nasdaq: ERIC) has had a busy Mardi Gras Tuesday. Not only has it made a significant acquisition but it has also tweaked its organizational structure by renaming its Business Unit Multimedia as Business Unit Support System (BUSS) and updating the unit's strategy. (See Ericsson Adds Wi-Fi With BelAir Buy and Ericsson Revamps Multimedia Unit.)

The move, which comes in the wake of the company's acquisition of Telcordia, helps to identify some of Ericsson's new strategic focus areas and also enables the company to relocate some products and developments, though only a single specific product line is being killed off. (See Euronews: Ericsson Seals Telcordia Deal, Ericsson Signals New M&A Era and Ericsson Closes Telcordia Acquisition.)

BUSS, one of three main organizational units (along with Networks and Global Services) has three main focus areas: OSS and BSS systems; TV & Media; and M-Commerce.

  • OSS and BSS: This part of the unit (fulfillment, assurance, analytics, charging and billing and so on) is now greatly expanded with the integration of Telcordia and has a key focus area of customer experience management (CEM). "Telcordia has filled a number of holes in our portfolio," noted BSS senior expert Jaco Fourie at a media briefing in London. (See Ericsson Shines a Light on CEM.)

  • TV & Media: This incorporates all the IPTV and video capabilities, much of which came on board with the Tandberg TV acquisition a few years back. It also includes much of what was formerly known as Consumer and Business Applications (messaging systems, service delivery platforms, rich communications suite and so on). However, the Business Communication Suite (VPN management, enterprise applications) has been shifted into the Networks unit to "better fit with our core IMS solutions," the vendor tells Light Reading. The company is also performing a "strategic overview" of the IPX multimedia brokering platform that sits between enterprises and multiple mobile operators to evaluate whether that should remain as part of BUSS. (See DT Does Enterprise Services With Ericsson, Ericsson Offers $1.4B for Tandberg TV and IBC: Ericsson Boasts Biggest IPTV Upgrade.)

  • M-Commerce: With 1.6 billion mobile users around the world linked to Ericsson's charging systems (mostly pre-paid), Ericsson sees a real opportunity to help service providers provide those users (and more) with mobile wallet services. The vendor has a number of products that service providers can deploy -- the Wallet Platform, the Converged Wallet and the Merchant Wallet -- and the M-Commerce Interconnect platform that Ericsson plans to use to become a broker (to "facilitate transactions") between mobile operators, financial institutions and businesses looking to sell their products and services. Ericsson, which believes the value of m-commerce transactions will reach US$800 billion annually by 2016, says it will announce a number of M-Commerce partners during Mobile World Congress.

    The one product Ericsson is discontinuing as part of this revamp is the consumer Money Service it launched last year in an effort to stimulate the mobile commerce sector in Europe. Now the company believes it is better positioned to help other companies provide such services. (See Ericsson Launches Money Service .)

    Why this matters
    The move marks the further evolution of the company to focus on a smaller number of key areas. Ericsson's CMO Arun Bhikshesvaran told the London media briefing that the company would be focusing its attention on mobile broadband, managed services and OSS/BSS at Mobile World Congress. (That, of course, makes its core focus areas pretty much the same as Nokia Networks -- see Analysts: NSN Focus Makes Sense.)

    The increased focus on OSS and BSS was expected following the Telcordia deal as the acquisition has made Ericsson one of the largest Service Provider Information Technology (SPIT) players globally. Now it can start sending that message to the operator community and look to develop business deals that encompass physical networks, supporting software and IT technologies and relevant professional services. (See Ericsson + Telcordia: What the Analysts Say and Why Ericsson Wants Telcordia .)

    However, there are still a lot of loose ends and Bhikshesvaran said there were still some parts of BUSS that could still be shifted into either the Networks or Global Services business units. And while its areas of key focus may be very similar to those of NSN, Ericsson has not (yet) decided to follow its rival's lead by culling non-core product lines. (See NSN Unveils Its Kill List .)

    Light Reading asked about the company's fixed-line broadband and optical transport assets that have hardly ever been mentioned by Ericsson since the Marconi acquisition: Bhikshesvaran said they are "alive and kicking … we need to talk more about that." (See Ericsson Buys Bulk of Marconi.)

    And there is still no real articulation of Ericsson's carrier cloud strategy: What can it do to help operators become cloud services players? Bhikshesvaran said the company will reveal its cloud enablement strategy at Mobile World Congress and doesn't believe Ericsson is too late in revealing its hand. "You have to come out with the right thing … we will take the cloud and the network to the next level." (See What Carriers Are Missing About Cloud and 5 Takeaways From Carrier Cloud Forum.)

    For more on Ericsson's recent activities:

    — Ray Le Maistre, International Managing Editor, Light Reading

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    Carol Wilson
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    Carol Wilson,
    User Rank: Blogger
    12/5/2012 | 5:42:03 PM
    re: Ericsson Boards Its Own BUSS


    They seem to be hedging their bets a bit, but it's interesting they chose to house the Telcordia SPIT assets in what was the multimedia group. I wonder if this means Ericsson sees the delivery of video over all various networks as one of the key challenges that its OSS/BSS business needs to solve?


    Like Ray, I'm wondering when their cloud strategy will emerge, since the back office integration bit is emerging as key to the success of cloud and Ericsson has certainly assembled a powerful set of assets in that space.

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