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September 2014

The Power Behind Telecom Thrones: Virtual Comms Technologies & Their Vendors

The Power Behind Telecom Thrones: Virtual Comms Technologies & Their Vendors

The telecom industry was much simpler 20 years ago.  Back then, the boundaries were clearly drawn between just two players: telecoms and vendors.  Telecoms owned and operated networks.  And vendors supplied the equipment and systems to make those networks work and interact with customers.

But over the years, the interplay between telecoms and vendors has become far more complicated.  Today many vendors can be considered outright telecom providers for a portion of their service portfolios.

Welcome to the wonderful world of virtual communications.  And by virtual I mean any third-party network solution that enables a telecom to gain a price or performance advantage over doing the same thing itself.  In the table below are eight virtual technologies that either have or will soon transform communications.

Virtual Technologies that Power the Communications World

Now, increasingly, the secret to a telecom’s success will hinge on such virtual technologies delivered by partners.  Why?  Well, it’s a simple matter of arithmetic.  Telecoms that do not virtualize face lower profit margins or reduced service capability than those that do.  So, it makes perfect sense for telecoms to learn all they can about the virtual technologies and suppliers that will shape the industry’s future.

One such comms provider that is a significant player in three of the virtual technologies shown above is Syniverse.  Because Syniverse is such a large player in the market, I’ve asked Ben Bannister, Senior Manager of Product Marketing and Strategy, to discuss Syniverse’s future direction.  And in the proces of that he's delivered an insightful reading of telecom’s tea leaves and next generation services.

Dan Baker: Ben, how is it that Syniverse has gotten involved in so many of these virtual technologies?

Ben Bannister: Dan, the story is actually quite simple.  We have strong capabilities around interworking, interconnection, settlement and clearing.  And those process capabilities enable us to expand in many different ways.  So, for example, in the roaming, interconnect or inter-carrier billing related areas, there are a whole bunch of things you can do to rationalize those processes and make them more efficient.  For example, an inter-carrier settlement platform that will handle all of the roaming and interconnect settlement processes is much more efficient than having different systems and processes to manage those very similar functions.  And, there are similar processes you can use to manage things like margin control through optimal routing, revenue balancing, netting, etc.

As the industry becomes more and more associated with OTT and content services, it will obviously need the means to manage the interworking, interconnection and settlement between the content providers and the OTT partner ecosystem.  Again, Syniverse is very well placed to serve that space.

And, the carrier services area we operate in is a different space from the mainstream BSS/OSS area.  The competitors are not the same as Amdocs, CSG, or Comverse.

Naturally, as we grow we need to find new ways to serve the different markets.  There are quite a few areas we are developing.  One of those is looking at the mobile transaction market and how non-telco enterprises can use mobile communications to interact with their customers and monetize mobile data intelligence for those enterprises.  It is something we call the Mobile Intelligence Portal, which is a content, brokerage, and settlement tool which we have been working on.

In the telecom space — quite apart from roaming — we do messaging interworking and other work centering on IP services, IP interworking, IP traffic settlements, LTE, and the development of LTE and LTE roaming as well as fraud and revenue assurance, again with a focus on requirements relating to LTE services.

So, there is a lot going on in the market and the key is to understand the trends and developing technology that support the operators in the direction they want to go.

Looking out into 2015 and 2016, we are interested in a variety of areas like IP interworking, LTE clearing, LTE settlement, new models for financial clearing, new models for revenue management, and new models for the margin management in the wholesale space.

A year or two ago, you did a consolidation move that greatly increased the breadth of your coverage internationally when you acquired the MACH properties.

Yes, I am actually from the MACH side of the house.  The combination of both companies was very complementary.  For example, Syniverse was very strong in the P2P (person-to-person) messaging space and MACH had been very strong in the A2P (application-to-person) messaging space and by combining the two entities — also noting that Syniverse acquired the VeriSign messaging assets a few years before — we have now become a very strong and credible international messaging services provider as well.

But we are not stopping there.  In May we announced our intention to acquire Aicent, a prominent company in the IPX and GRX (GPRS Roaming Exchange) space.  And again, the intention is to consolidate and strengthen our position in GRX but particularly the IPX space.

So, our focus is very much on serving the entire mobile ecosystem, including operators, MVNOs, enterprises, application developers and more.  There is considerable fragmentation in how different protocols and network technology operate together; how people partner; and how services are offered by OTT providers on their own and in partnership with the telecom providers.  The resolution of these is where our core strength lies.

So, that mobile ecosystem which continues to evolve is the area that Syniverse is focusing on, both in the short and long terms.

It’s a very interesting marketplace that is shaping up and the whole notion of partnering with over-the-top players and in Syniverse’s case of actually becoming a service provider itself with IPX and messaging.

Actually, the TeleManagement Forum defines us as a service provider, and it’s precisely because we have our own networks — we can carry traffic, and we provide signaling services.  So, we are a kind of hybrid between pure wholesale carrier and a software/services vendor.  That blurring the edges is really what differentiates us from the pure software vendors in the OSS/BSS space.  And, having assets in both camps is good because it helps us to develop our systems — particularly in understanding network problems because that’s a challenge we face ourselves.

So, when it comes to IPX for example, there are issues around different types of IP services; different types of traffic; how you prioritize and manage different traffic; and how you operate with different partners and ecosystems.  And we’re ideally positioned to help the mobile network operators and MVNOs, as well as OTTs address these challenges.

Ben, how long is it going to take for next generation services like IPX and advanced LTE to take off?

The demand for LTE will rise as the demand for data, video and HD voice grow and it also depends on how LTE is marketed.  Once demand increases, it’ll take several years to reach ubiquitous LTE roaming.  This, of course, requires IPX, but there will be a co-existence of various network assets for several years.  During this long heterogeneous network period, Syniverse can offer the marketplace its solutions that enable the management of the different types of network entities and the wholesale processes that support them.

IPX as a concept has been around since the GSMA specified it several years ago, but certain elements of the market don’t quite move as fast as certain other elements.

Many operators have either acquired or developed their own IPX capability.  The whole point is to drive IPX adoption, not just by the operators themselves, but also by other companies within the potential ecosystem.  So, it will be interesting to see IPX rollout as we move through this kind of coexistence period.  But to migrate the whole IP core and IP access networks is going to take time.

And, it’s not just the adoption of standards and new business models slowing these things down.  For example, IPX implies that you have a robust MPLS capability to take the traffic and deliver a quality service end-to-end.

MPLS provides a complementary routing capability to that offered by Diameter Routing used in conjunction with an IPX.  The co-existence of different approaches is exactly what I am saying will remain for some time to come.  You will have MPLS working together with standard IP layer 3 routing.  It will take several years before a single approach to routing becomes accepted, if ever, because it is not just switch and packet-based traffic, but different flavors of LTE and different types of traffic that have to be managed.

MPLS today is mainly a large carrier capability because leading network equipment providers like Cisco and Juniper will resist attempts to open up very much.

If you look in the past at Alcatel or Lucent, Nokia or Ericsson, these equipment vendors were not focusing so much on compatibility between their equipment.  Now, these providers that you mention face exactly the same problem the big network guys had 10 years ago.  There’s not much difference.  Groups are not likely to work together to potentially commoditize services and equipment.

Working toward standards takes a long time.  It’s the nature of the commercial markets.  Even in LTE, you will have a TD-LTE-based approach that some operators are following, which differs from the FDD-based LTE more common in Europe and North America.

Quite apart from network equipment there are other issues, including spectrum fragmentation, and the need to define common spectrum within which you can do LTE roaming.  So there are many issues and challenges in the market, which is why Syniverse, fortunately, exists to resolve and provide solutions to these.

The 800 pound gorillas in the room, of course, are the OTT players who are the ones driving change.  But I take heart in the fact that telecoms are still the best at monetizing network investments and figuring out how to partner with service providers of all stripes and getting paid for it.

If you recall a few years back when people were pushing IMS, the whole point was to provide an operator-based alternative to what these OTT providers do — to offer something with a much better quality of service.

Even today, not many operators have yet deployed IMS-based RCS services, and one reason for that is it’s been difficult to find the real killer app and a return on their investment.

But, the path forward is clear: operators really need to put together a combination of services that are appealing to people who want to actually pay for them and use them.  It is going to be more than just voice or messaging.  It is going to be a combination of things.

The challenge, of course, is the perception that organizations like Facebook and Google can conceive and launch services very swiftly.  So while the telecom community is strong on working together and launching inter-carrier services, they need to adopt a more agile approach.

On the other side of the coin, the OTT providers don’t have network assets to protect.  And, for them, the question is: Can they invest to improve the quality of the services rather than just provide free services?

The key is finding ways for the operators, OTTs, brands and any other player in the mobile ecosystem to work together to deliver the experiences end users are expecting.  That’s why we’ve developed solutions like the Mobile Intelligence Portal.

Thanks Ben, for these keen insights.

As I say, Dan, it’s going to take some time and the question of who will actually win a particular battle remains to be seen.  But certainly the tools are in the tool box for the operators to enable them to do some very interesting things.  And, in the wholesale space, where cost obviously is a big issue, a whole bunch of things can be done to improve efficiencies and drive down costs.

Copyright 2014 Telexchange Journal


About the Expert

Ben Bannister

Ben Bannister

Ben Bannister is responsible for Syniverse’s product marketing strategy, proposition development and execution for telecom services and solutions.  Prior to joining Syniverse, he held a variety of product marketing, management, and operations roles -  most recently working with clearing house service provider MACH.

He’s worked within the operational and business support system software industry at Intec, Convergys, Geneva Technology, Martin Dawes Systems and DST Innovis.

In addition to a 12-year career in the IT services and applications software sectors, Ben spent more than a decade working in the semiconductor industry in a variety of roles for AMD, National Semiconductor, Racal and Intel.

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