Convergys Swallows OSS Specialist

Not content with just having OSS minnow Ceon Corp. as a partner, Convergys Corp. (NYSE: CVG) has decided to go the whole way and buy the "product lifecycle management" specialist for an undisclosed sum. (See Convergys Acquires Ceon.)

The move doesn't come as a big shock: Convergys invested in Ceon earlier this year when the two companies forged an alliance. (See Convergys Invests in Ceon.)

So why has Convergys, probably best known for its billing software and services, made this move?

It all comes back to the ongoing shift towards service (or 'product') creation and management that has been ongoing in the telecom world for the past few years. As carriers move away from network and service "silos" towards a more converged network architecture and back office, they've been looking at ways to build new services from applications building blocks that can be used in different combinations to form different end products. Simply put, this process involves creating and managing "catalogues" that can be used as the starting points for service creation. (See Telcos Enter the Factory Age and Why OSS Silos Must Come Down.)

And this is where Ceon fits into Convergys's strategy. (See Ceon Launches SDP and Ceon Unveils Its PCC.)

Convergys says it's attempting to help service providers "better construct, manage, and deploy a layered catalogue that includes the full technical and commercial definition of products and services," and that Ceon's software is "at the heart of our strategy to help our clients more effectively manage new and advanced value-added services, introduce these services quickly, and evolve these new offers at market speed."

That ability to create, manage and deliver new services from catalogues was also the driver behind Comptel Corp. (Nasdaq, Helsinki: CTL1V)'s decision to buy Axiom Systems Inc. earlier this year. (See Comptel Snaps Up Axiom.)

The shift towards these service catalogues is very real: BT Group plc (NYSE: BT; London: BTA) has stressed the importance of the building block approach on a number of occasions, while Telekom Austria AG (NYSE: TKA; Vienna: TKA), one of the more forward-thinking operators in terms of telecom software strategies, is already working towards that goal. (See Telcos Soften Up and Tribold Wins at T Austria.)

With the carriers heading in this direction, it'll come as no surprise that Convergys and Comptel are not alone in building service catalogue expertise: Software heavyweights such as Amdocs Ltd. (NYSE: DOX), IBM Corp. (NYSE: IBM), and Oracle Corp. (Nasdaq: ORCL), among others, are also developing such capabilities.

Convergys's move comes as it considers spinning off its telecom software business into a separate company. (See Convergys Mulls Billing Spinoff.)

— Ray Le Maistre, International News Editor, Light Reading

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