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A DEEP Dive on Sunrise's Digital Transformation

James Crawshaw
11/15/2019

Sunrise Communications, the second-largest telecom operator in Switzerland, reported third-quarter service revenue growth of 2.0% and EBITDA growth of 2.0% driven mainly by its Enterprise division which posted revenue growth of 8.3% and EBITDA growth of 9.1%. While 2019 revenue and EBITDA guidance was confirmed, the company will now have to take a charge of around CHF125m ($125m) due to its aborted bid to buy Liberty Global's Swiss cable unit (see Liberty Global Revenue Slump Deepens). The charge includes a CHF50m penalty payment to Liberty Global, CHF70m banking, advisory and legal fees as well as already incurred integration costs.

With the cable acquisition off the table (for now at least) Sunrise confirmed its investment strategy will focus on three strategic priorities: network quality, customer interface and innovative converged products. Although Sunrise generates most of its revenue from consumer services, in recent years the group has increased its focus on its Enterprise division, which now generates around 17% of total revenue. Sunrise undertook a major renewal of its Enterprise product portfolio in 2017. The Enterprise product strategy was refreshed again at the end of 2018 to keep pace with new market demands.

Keeping up with the changes in Enterprise product strategy and portfolio places huge demands on the IT organization supporting an operator's OSS and BSS. In order to support these demands Sunrise is undertaking a Digital Transformation project in partnership with Huawei. The goals of the project are to improve the user experience (e.g., ease of ordering), remove obstacles on the customer journey (awareness, buy, use, pay, upgrade), increase agility and accelerate Sunrise's ability to innovate as it moves into the 5G era.

A key component in Sunrise's Digital Transformation is its Digital Engagement Enabling Platform (DEEP), a middleware solution that connects legacy IT systems (OSS, BSS, etc.) with customer-facing portals and applications. According to Huawei, DEEP has a lightweight architecture that enables operators to easily integrate data from legacy systems through a series of open APIs.

DEEP is designed to provide an enhanced customer experience and enable rapid product and service innovation. An orchestration tool allows products to be easily combined and arranged for different business scenarios using a graphical user interface. The solution enables easy online ordering, purchasing and other self-serve capabilities for enterprise customers.

DEEP integrates southbound with backend IT systems (OSS, BSS, ERP, etc.) as well as network controllers and cloud management platforms. This enables the automatic fulfillment of order distribution, resource scheduling and activation verification. Sunrise created over 50 APIs to connect DEEP with their legacy IT systems.

Sunrise's digital operation transformation should enable it to become more agile, rapidly launching new offerings to keep pace with a fast-changing market. A centralized product catalog should enable marketing managers to configure new offers using a simple drag and drop interface without requiring IT support. Sunrise's target is to shorten the time from idea to product from months to weeks.

The new systems will enable Sunrise to give its enterprise customers a superior service experience. They will be able to order online rather than having to order via account representatives. The time from order to activation should fall from months to just days. In addition, customers will have some self-service capabilities enabled by automated network and service provisioning systems.

To find out more about Sunrise's IT modernization, download the Heavy Reading whitepaper "Digital Operation Transformation: Increasing Sunrise's B2B Agility" here.

This blog is sponsored by Huawei.

— James Crawshaw, Senior Analyst, Heavy Reading

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