Why cloudnomics is the route forward for telecom service providers
October 22, 2020 - Openet
Global telecom service providers are deploying 5G networks and as far as new services are concerned, anything goes, as new business models are tried and tested to maximize new revenue opportunities. The onus today is on becoming digital service providers and migrating towards a 5G-as-a-Platform model. This shift will see telecom service providers draw on the concept of cloudonomics.
It’s widely understood that moving a telecoms network and associated IT stacks to the cloud equates to huge CapEx savings (more than 50% for traditionally built telecom service providers). Cloudonomics is a concept that goes one step further, by including the operational savings that are made when escaping the cyclical rounds of continuous hardware and software updates. Facilitating a shift from customization to configuration, cloudonomics removes the ties of legacy infrastructure and affords telecom service providers the flexibility to change at pace. Furthermore, it also enables telecoms service providers to reduce OpEx by dispensing with the need to own and maintain legacy IT stacks.
The new generation of network monetization
The emergence of cloudonomics naturally coincides with a very distinct inflection point, that of 5G. Some traditional telecom service providers have already embarked on a total overhaul of their legacy systems to keep up with the pace of change. We are entering the age of the cloud-based telecom service provider, where open, agile systems are the foundation on which all services are built and deployed. Moving away from simple connectivity provision and becoming digital telecom service providers requires speed and agility, achieved through the use of open, cloud-based systems. Cloud-native IT is the central foundation to help enable this shift from traditional service provider to digital service provider.
This shift will also be the driving force behind partnerships and collaboration. It’s understood that 5G ROI will likely come from B2B services, rather than the traditional consumer offering, so telecom service providers will be looking to partner with enterprises to develop exciting new services. Cloud-based, platform-driven 5G partnership ecosystems are one way for telecom service providers to develop and launch a range of new B2B and B2B2C services. These platforms harness APIs and 5G Network Exposure Functions (NEF) to allow partners to collaborate with telecom service providers to deliver out-of-the-box services. The goal for the telecom service provider is to become ‘magnetic’ to potential partners, making it as simple as possible to develop and launch new services. Here telecom service providers become enablers, but this only becomes valuable if they have the right monetization tools in place.
Another key to 5G ROI is network slicing, which when leveraged will allow telecom service providers incredible levels of network control. With network slicing, telecom service providers are afforded the agility and flexibility to offer a huge range of services all based on individual SLA-grade requirements. For example, a dedicated low-latency slice for remote surgery, or a reliable high-speed connectivity slice for emergency services. This new approach is changing the nature of telecom service providers, who will no longer be seen as dumb pipes. Allowing telecom service providers to scale network resources up and down on a per slice basis opens a world of revenue opportunity.
Telecom service providers can then sell these highly configurable 5G-based service models from an app-store style enterprise marketplace. Advanced policy and charging rules can be used to manage QoS, network slicing, real-time usage, and pricing of services and allow them to become capable of selling hugely valuable service level agreements (SLAs) to enterprise customers. The click, purchase, deploy approach to delivering a range of 5G enabled services, comprising of partners’ offers and dynamic 5G connectivity on-demand, places the telecom service provider at the centre of the 5G enterprise value chain. And this is just the tip of the iceberg; with the right monetization tools in place, telecom service providers can ensure they are able to “monetize anything” quickly and cost-effectively as and when new services and opportunities are brought to market.
Cloud and 5G are transforming the telecoms industry and bringing about a shift in the types of services telecom services providers can offer both enterprise and consumer customers. This wealth of opportunity is an exciting one, especially as telecom service providers vie to make a return on their 5G investment. But to succeed, providers must ensure they have the modern, agile, digital monetization tools that will allow them to capitalise on the opportunities that present themselves.
Original article in RCR Wireless.