Confessions of an Oracle Shopaholic: Pt II

In the second part of his exclusive interview with Light Reading, Bhaskar Gorti, the head of Oracle Communications, talks SDN/NFV, sales strategies, competition and the future.

August 19, 2013

11 Min Read
Confessions of an Oracle Shopaholic: Pt II

Oracle Communications is already one of the big hitters in the Service Provider IT (SPIT) sector, with an enviable customer base, a broad portfolio of software and hardware products for communications service providers (CSPs) of all types, and revenues in the billions.

And as the worlds of telecoms and IT continue to merge, it seems likely that Oracle's influence will grow stronger (for better or worse). Exactly how influential a role the Oracle Corp. division will play will, at least in part, be determined by the strategic decisions of Bhaskar Gorti, senior vice president and general manager, Communications Global Business Unit

Figure 1: Curtain Call for Mr Gorti The next phone call is never too far away for Bhaskar Gorti, senior vice president and general manager at Oracle's Communications Global Business Unit. The next phone call is never too far away for Bhaskar Gorti, senior vice president and general manager at Oracle's Communications Global Business Unit.

With some significant acquisitions under his belt this year, it was a good time to meet with Gorti, who was joined by Gordon Rawling, senior director of regional marketing at Oracle Communications, to get his take on the changing face of the communications sector.

In Part I of the interview, we discussed the Oracle Communications portfolio, the trends in the broader industry that are impacting Gorti's customers and his strategy and Big Data/analytics. (See Confessions of an Oracle Shopaholic: Pt I.)

In this, the second and final part of the interview, software-defined networking (SDN) and network functions virtualization (NFV), Oracle's rivals, sales strategies and the future come under the spotlight.

— Ray Le Maistre, Editor-in-Chief, Light Reading

On page 2: Gorti on preparing for SDN/NFV.

Light Reading: You mentioned the need to meet the service providers' needs as they shift to new networks and systems. As they move towards software-defined networking (SDN) and network functions virtualization (NFV), what do you need to do to your business to be ready for the telco RFPs they say they want to virtualize?

Bhaskar Gorti: We are seeing some requests that just say, "Do you support virtualization?" We already support this. The entire Oracle Communications portfolio right now is supported on a virtual environment and that is one of the key design criteria we have for R&D and for acquisitions, including when we looked at Acme and Tekelec. Within the broader Oracle we have our own hypervisor and we have our own VM [virtual machine] and we can leverage that expertise. It's at the early stages but you will see us bringing to market more and more of these capabilities and anything we bring will be running on a dedicated environment and a virtual environment. Whether it is policy, Diameter, session border controller, SIP trunking and IMS elements, they all run on purpose-built and a virtualized environment.

Light Reading: So that's your products in a virtualized environment, but what will be the impact on your portfolio of the introduction of SDN and NFV, because the general perception is that today's OSS tools, not so much the BSS, having been built for legacy networks are perhaps not relevant for SDN. The concern is that the OSS toolsets are not fit for purpose for future networks, albeit a long time in the future. Are you thinking about how to make your OSS tools relevant in a virtualized environment?

Gorti: If you look at our OSS portfolio, our activation tools have the capabilities for virtual IP addresses as well as physical network elements and we are adding more capabilities to that. Our inventory system has a federated user interface so that it can manage not only a physical network. So we see virtualization as a positive trend for us, it has been a direction for us for a while -- we are building service fulfillment portfolios that are not dedicated to any physical network. We are not just waiting for this to happen, we are proving it to network operators.

Light Reading: In what way?

Gorti: With deployments and with our architecture, with that level of hardware independence. Many of the operators run heterogeneous elements and they are trying to figure out what systems to get to run their networks and, well, that's perfect for us because we are a neutral party. We are saying to the operators that they can architect a service fulfillment layer that creates an abstract to the physical networks they have deployed. The other important thing is that it's not just a multi-vendor network environment but it's a multi-network environment -- mobile, fixed, cable … how can your service fulfillment handle a multi-network environment? We feel this is all very positive for us but it is at the early stages of course. It's at the early stages because the operators need to feel more confident about this and the suppliers need to adapt. If you look at some of the large traditional network suppliers they are not really ready for this, they are not motivated to come up with solutions that will make it easy for an operator to deploy, for instance, four different RAN [radio access network] vendors, but that's where we can help.

Light Reading: Do you feel there is a lot of education still needed on how the convergence of IT and telecoms is going to affect the industry on both the supply side and at the network operators?

Gorti: A lot of people are asking questions and putting things in presentations -- a lot of the time it is just buzzword compliance [laughs]. For example, I was talking with a network equipment vendor and they were talking about session delivery networks, and I asked, "What's your view on Acme?" And they noted that while Acme was independent, their session controller had to be tied to their switch or router. Acme has a large market share because most of the other SBCs have just been added as another feature of a router or of something else. A lot of the traditional players are adding these capabilities to drag their network element into the IT and virtual world and that mindset has to evolve. It has started, but it has to speed up or the software companies will … well, the landscape is changing.

On page 3: Gorti on industry rivals and the Oracle sales pitch.

Light Reading: Who would you say are your biggest rivals?

Gorti: We have category competitors. In the BSS and OSS space, there is Amdocs Ltd.. We have a product-driven approach, they have their services approach but they are definitely a competitor in that space.

Then in unified communications we have small competitors such as Openwave Messaging Inc., Critical Path Inc. and companies like that.

In service delivery platform, the apps servers space then you have IBM Corp., but I don't think we have seen Microsoft Corp. app servers in that space.

In session delivery, with our Acme and Tekelec capabilities, then we have competitors that are the traditional suppliers, such as Ericsson AB, Alcatel-Lucent, Nokia Solutions and Networks (NSN). In some cases we are competing with them and in others we are partnering.

We also see some of the large network equipment players, where they are trying to bid for a whole network -- to build and operate -- they are throwing in these software assets, saying that they have the BSS and everything else. If someone is doing a $2 billion to $3 billion network rollout, they'll throw in a few things but then the operator finds that it's not a Tier 1 solution, that it doesn't scale and that it has functionality that locks the operator into the infrastructure supplier.

In the telco retail space, in providing the point-of-sale solutions for the mobile operators in their shops for example, we definitely run into SAP AG retail quite a bit.

In order management, we would run into IBM [which bought Sterling Commerce a few years ago].

Gordon Rawling: It's quite rare but you do get some clients who want it all and they want someone to go with them. But we rarely get clients these days who bring out RFPs or RFIs that are just for small sub-sectors or small segments, because they need everything to coordinate. Increasingly the conversations are around having a common experience at retail, at CRM, at the Web presence.

Gorti: We do sell these independently and we do compete when we see an RFP that is just, for example, for pricing and charging and we compete on all of those. But we say to the service providers, are you just buying tires or do you want the whole car? We will compete for the tires, definitely…

Light Reading: That's interesting because there has been talk that Oracle had gone to a model where the customer has to take it all or have nothing at all…

Gorti: We want to have a complete portfolio and everything will be built as standards-based, but we never … we get a lot of inbound requests and we look at it, but nine out of 10 times it is all tied in and we say we're not interested. For example, we see cases where someone will say, you can use our session border controller but then you have to use our analytics otherwise we can't provide you with a dashboard. And that's the cause of a lot of problems for the network operator -- about 70 cents of every dollar they spend is going on trying to make these pieces work together. It is more about competitors who are saying that, but not for us. When we bought Sun I know a lot of people said, "Oh this means from now on we have to get your stuff on Sun servers." But no -- our software guys aren't compensated on the hardware at all!

Light Reading: So is that talk that you will only supply a full package just scuttlebutt?

Gorti: Yes. Of course we would like the network operators to buy the whole car from us and not assemble the pieces in your own garage and many of them, including large Tier 1s, are doing that.

But the telecom industry is a little unique compared with others because most computing technologies came from telecoms, so there is an inherent belief in this industry that things can be built in-house. We would like to sell the whole package but only about 20 percent of my customers would buy a whole stack -- retail, order management, CRM, billing, activation and so on -- but that's growing. We call it Rapid Offer Design and Order Delivery (RODOD) -- it's a business process.

On page 4: Gorti on what's next for Oracle Communications.

Light Reading: As the CSPs adapt to the new and emerging digital services and virtual networking environments, are there other areas that Oracle Communications needs to get into, whether through R&D or through further acquisitions? (See M&A Mayhem: Who's Next for Oracle?)

Gorti: Almost 25 percent of our business comes from non-service providers, for example, large enterprises, which have similar, if not the same scale, OSS needs, unified communications needs. Then there are other companies that are digitizing their assets and making it available to their customers online, so they need rating and billing and charging for that.

Light Reading: So do you think you have the complete portfolio for your service provider and other customers?

Gorti: No, I would never say that. We are constantly looking at how we can accelerate some of the transformations that are happening, so we are continuously looking at what is the logical innovation that we can bring, whether we do it in-house or not. We get a lot of coverage when we acquire something but an equal amount of R&D goes on in-house. So we are looking at how we can deliver a complete portfolio for unified communications -- voice, data, video.

The other area where we have some early wins and which is still at an early stage in the industry is device-to-device communications. We were doing device-to-device before the phrase machine-to-machine was coined, whether it's telematics or … What is missing right now from device-to-device is how to monetize it, if there is a way to do it.

We will also increase our focus on the business services side of the telcos, to help them deliver more than just the pipe to their large enterprise customers. Acme helps us there. All enterprise CIOs are trying to reduce their communications costs and increase collaboration, so SIP trunking, session management, unified communications, WebRTC -- these are all logical things for that. For example, Verizon helps many large financial institutions reduce their costs by migrating them to IP.

When we have ideas, we only pull the trigger on those ideas after input from key service providers. We always look at what the service providers are investing in. We have never made an acquisition where the service providers have said to us, "Why did you go and waste your money on buying that stuff?" We have an advisory board meeting twice a year -- no sales, just product managers and chief architects -- and we share what we are doing and show them the products we are adding and what we think we should add, and then there's an input process. The service providers, including the Web services giants, are our biggest source of input.

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