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May 10, 2013
Following a tumultuous, tricky few years of upheaval that ended in independence from its former parent, it was clear that Comverse, one of the Service Provider Information Technology (SPIT) sector's major vendors, needed a determined, level-headed and focused character at the helm.
Philippe Tartavull, who took the CEO role in May 2012, about five months before Comverse Inc. became a standalone company, fits the bill. (See Comverse Plans for Independence.)
When he says that 2013 "is all about being operationally focused … and achieving growth," his determination to succeed is almost tangible.
But he has his work cut out. Comverse, with its portfolio of billing, charging, customer experience, data management (policy control, content management) and Value Added Services (messaging and voicemail platform) products, may still be among the top tier of SPIT vendors but it needs to reverse its recent fortunes. It generated revenues of US$678 million from its 450 or so communications service provider (CSP) customers in its most recent full fiscal year (to Jan. 31 2013), but that represented a decline of 12 percent on the previous full year.
And despite that volume of revenues the company still reported a small annual operating loss of $2.2 million.
Tartavull, though, is aware of the challenges, and believes the Comverse ship is still very much afloat and is not too big to turn around quickly. "Comverse is not too big and not too small and that's a good position to be in," says the CEO during a recent conversation with Light Reading.
And the early signs are already encouraging: Comverse reported a slight year-on-year increase in fiscal fourth-quarter revenues to $183.6 million and generated an operating profit of $5.6 million. (See SPIT Giants Make Q1 Gains.)
He also comes with a solid reputation. "Tartavull is an actionable guy. He gets the job done," says Heavy Reading senior analyst Ari Banerjee. "Under him, operators are seeing a clearer vision for the company and a more integrated vision. It's not just about BSS products but also about helping operators make money from OTT and social media. It's all more relevant. He has made a difference and now Comverse has a better standing in the industry," adds the analyst.
So what can Tartavull do to ensure positive momentum? One of the first things he did after taking charge was talk to his major customers.
"I have been asking CIOs, 'what do you want'? The key things are that they want systems that are easier to deploy and manage … and they need to be able to get to market more quickly. They're prepared to trade nearly all functionality to achieve that. They say they can wait for extra functionality if they can achieve a quicker time to market."
He's also keen to react to increasing customer demand for managed services. "About 20 percent of our staff are in the services team ... it's what customers want and it's a good way to keep in close touch with our customers. All our new engagements come with a managed services offering," says the CEO, though he declined to provide any detail on the level of revenues Comverse is targeting from such services other than to say the company is starting from "a low base."
A more immediate growth opportunity comes from the greater functionality mobile operators need as they migrate to 4G. He says Comverse has been seeing "more serious opportunities" as a result of LTE deployments and that there should be a better view of the overall opportunity offered by the 4G wave during the second half of 2013.
Part of that opportunity comes from the growing CSP requirement for deeper insight into what mobile data users are doing and how they are using applications on their smartphones. "Analytics has been a big focus for us, especially analyzing social media usage in order to enable [the CSPs] to push more targeted services and adverts. This is something that's been taken up in North America."
And it's a topic that is set to generate a lot of heat at this year's Management World 2013, where Comverse plans to "highlight social media as an interaction channel" as part of its show floor demonstrations. (See Comverse Tackles IP Transition at MW13.)
Of course, Comverse isn't operating in a bubble. It faces intense competition from a raft of new competitors that have developed policy and charging systems, next-gen messaging tools and all manner of back office support and service creation platforms. And, of course, long-time foes such as Amdocs Ltd., NetCracker Technology Corp. and Oracle Corp., along with the ambitious AsiaInfo-Linkage Inc. and Redknee Inc., will be doing their utmost to make life difficult for Comverse. (See Redknee Seals NSN Deal and AsiaInfo Takes On BSS Giants in Europe.)
Tartavull isn't fazed by the competition. "Do operators want to go with just one vendor? No," he says.
His focus is more trained on what his company is doing and how that relates to its customers. What is critical for Tartavull is that customer requirements are matched by product developments and operational capabilities of the company he has been running for almost a year. "We're developing a culture of transparency and focus," he says, and that's needed now more than ever. "When customers ask us to be involved in a transformation, it's an act of trust."
— Ray Le Maistre, Editor-in-Chief, Light Reading
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