x
Cloud Services

Cloud Success Requires New Thinking

Smaller telcos looking to get over the lost revenue hump with cloud services will need to change the way they do business, advises one CEO whose company specializes in delivering cloud to the Tier 2- and-smaller telco market. (See Small Telcos Can Get Cloud Boost.)

James Taylor, CEO of CHR Solutions Inc. (and not this guy), frequently sees smaller companies whose refusal to trim their product catalog hampers any ability to make their operations more efficient.

The real value of upgrading BSS/OSS capabilities to enable more on-demand services and rapid turn-up/turn-down of new offerings is lost if telecom service providers just drag forward an aging product lineup that includes voice packages sold to customers a decade ago or more.

"Telcos need to clean out the old stuff," he says. "They have the right to convert [existing customers] to a new package of services, and many customers would even welcome that if it was done properly."

Failure to do that kind of product and service restructuring makes upgrading of BSS/OSS a longer and more painful process than it needs to be, undercutting the ultimate goal of the process. CHR works to convince its smaller telco customers to adopt best practices it has developed over the years, in order to achieve the maximum savings in the shortest period of time.

Part of that savings is based on achieving economies of scale by not having to customize systems. That's also a message the telcos should then be taking forward to their SMB customers that want to adopt cloud services to lower the cost of IT.

"It's all about economies of scale," Taylor says. "SMBs are real businesses that spend real money, but they can't afford to do things piecemeal."

Instead, they are looking for end-to-end services with predictable pricing, rock-solid technical support and flexibility that works to their advantage.

"Variability of pricing is a big issue for SMBs -- they don't want to see the cost of what they are using jump from month to month," Taylor says. "Some of them might not even have the cash to support that."

Delivering predictability also shouldn't be that hard, he adds, if service providers accept the fact that cloud services don't have to be highly customizable. The way businesses consume cloud IT services doesn’t vary that much, even from industry to industry. Most companies use underlying hardware that is largely similar and much of the same software as well. And while different industries have different compliance rules and regulations to satisfy, CHR has found that if they build everything to meet the Payment Card Industry (PCI) compliance rules, they can cover most of what other industries require as well.

"If you comply with PCI, you meet the 99 percent of what other industries require," Taylor says.

— Carol Wilson, Chief Editor, Events, Light Reading

cnwedit 12/5/2012 | 5:42:00 PM
re: Cloud Success Requires New Thinking

Actually, for many smaller and rural telcos, lost revenue includes USF funds that are being cut and lower inter-carrier compensation. Plus, it costs more for them to deploy broadband, so while the "revenues" are there, the profits aren't guaranteed. So maybe I should have said the "lost profiles hump."

DCITDave 12/5/2012 | 5:42:00 PM
re: Cloud Success Requires New Thinking

I assume the "the lost revenue hump" refers to declining voice revenues. But didn't charging for basic data services like broadband access more than make up for that revenue at most telcos?


 

paolo.franzoi 12/5/2012 | 5:41:58 PM
re: Cloud Success Requires New Thinking

 


So, how does this concept square with the existence of say Iowa Network Services?  INS exists because the little telcos can't figure out how to be an ISP.  Now they are going to be cloud providers?  All I can say is ROFL...


seven

paolo.franzoi 12/5/2012 | 5:41:57 PM
re: Cloud Success Requires New Thinking

 


Since I do as well...sell cloud to small carriers...all I have to say I am always glad the day the guy who knows the firewall is in the office.


seven

cnwedit 12/5/2012 | 5:41:57 PM
re: Cloud Success Requires New Thinking

So you sell cloud to small telcos -- for them to resell? But you think it's hilarious that small telcos are going to offer cloud services?


 

cnwedit 12/5/2012 | 5:41:57 PM
re: Cloud Success Requires New Thinking

Actually, there are multiple companies providing cloud services for small telcos to white label - and some of them are laughing all the way to the bank.


 

paolo.franzoi 12/5/2012 | 5:41:52 PM
re: Cloud Success Requires New Thinking

 


Cloud Services require IT expertise.  The smaller telcos lack a lot of it.  We sell them a very basic service (email filtering).  Even with our service...they often can't find out/support/manage any changes to their ISP infrastructure itself.  They have often outsourced it and the "guy" comes in when he feels like it.  The larger of those carriers (Surewest/TDS) maybe....but the mom and pop IOCs are highly ISP challenged.


seven


 

Flook 12/5/2012 | 5:41:51 PM
re: Cloud Success Requires New Thinking

You may have a point. A few years back while doing some research into rural telcos I got the feeling that many or most lack tech expertise and so they turn to engineering/consulting firms that specialize in providing services to small telcos.

HOME
Sign In
SEARCH
CLOSE
MORE
CLOSE