Pilot 2.0 (Part 2): Using Old Systems for New Business Models
Sometimes new business models feel too complicated to undertake. However, new methods and technologies are enabling operators to trial new business models without having to change their existing systems or processes. Some people are calling this "BSS 2.0".
Building on our last post on how to pilot Telco 2.0 ideas, this guest article from Andrew Thomson, VP Solutions at Infonova expands on his stimulus presentation from May's Telco 2.0 Executive Brainstorm and provides some examples of where and how "BSS 2.0" could add value.
PS: Scroll down to see an interview with Simon Torrance and Andrew Thomson for TelecomTV on the same topic
Telecommunications - An industry undergoing massive change
As we know, the industry is changing rapidly with new revenue models being invented and delivered by dot.com type companies. To compete, telcos and service providers will have to transform. But most telcos / service providers are trapped by their legacy systems. In many cases, internal culture and conventional suppliers still advise the CXO's to plough further investment into legacy systems that have already cost millions.
At the same time, network transformation is driving massive investment and many advisers recommend integration at the OSS layer to deliver transformation for the operator and the end customer. Integrating legacy systems may deliver new functionality for both transformation and complex two sided business models - but it will cost millions and will take years. Executives need to evaluate faster new technology options that overlay and orchestrate existing systems or they may find that the market has moved on and left their company behind.
The transformation dilemma
Most telcos are facing a key challenge: network transformation. The move from physical networks to logical IP services on physical networks is forcing most telcos to re-think their investment and market approach.
Figure 1: Technology Assets & Business Transformation
The BSS 2.0 needs to deliver an abstracted BSS capability that supports NextGen, legacy services and new business models simultaneously so that a telco can ensure that it migrates its customers from legacy to NextGen at the appropriate time - be it geographic specific migrations or event driven migration.
New business models
The market is evolving rapidly, with new entrants like Google, Skype or Freeserve offering new ways for consumers to subscribe to services. One thing is clear ... a broad array of new business models will need to be supported by telcos' BSS systems so that telcos can stay relevant.
Figure 2: Fixed and Mobile Bundling - a first step
Bundling capabilities are a key facet for new business model success. If a telco cannot offer a simple level of bundling where, for example, pooled minutes can be shared between fixed and mobile then their systems will probably not have the capabilities to support more complex business models. Again, many advisors will propose that this can be resolved with integration at the OSS layer - proceed down that route and be prepared to spend millions and wait several years!
Telco Apps stores
Order to cash BSS platforms should be technology neutral and able to support the latest business models - simultaneously at the same time as existing / legacy business models. App Stores are expected to be a major cash generator in the next decade... the capability to support complex business models that facilitate multiple parties involved in Apps stores to readily execute and benefit from revenue sharing models is a key requirement.
Figure 3: Apps Store - Monetisation
For example, multiple operators can offer their API's for Apps Developers to incorporate within Applications. When applications have been developed, the developer lodges his / her App in both the Primary Operating Entity catalogue entity and the relevant Application Store catalogue. This enables the automated disbursement of royalty revenue allocation to all the respective parties when an end-user consumes an App. A key issue solved is the ability to support true partitioning of multiple catalogues so that Apps can be marketed under various brands to appropriate segments.
Monetising the OTT Hype
A number of new players have entered the market operating an approach that has been termed "Over The Top". Apple is one of the most significant players with its iPhone product. Other device vendors have been trying to determine their approach to achieve a similar type of relationship with end-customers - while at the same time trying to avoid offending key customers ... the operators.
Figure 4: OTT Emulation & Monetisation
Using a multi-layer business model, both operators and device manufacturers can benefit. The operator wins a new channel to market and is able to participate and share in the revenue opportunities.
This enables manufacturers to sell their devices with a service / carriage relationship direct to the end customers. The package can include other bundled services such as, device insurance, fixed line services, content and other accessories. This business model enables the device manufacturer to use the monthly billing relationship to capture micro charges and to have a regular marketing feedback loop with the customer. It also provides the capabilities to share and allocate new revenue streams with other third parties.
Enabling Channels to Market
There are increasing opportunities to assist Business-to-Business-to-Consumer models. One example illustrated below enables an automobile manufacturer to enable his dealers to be channels to market.
Figure 5: Tenancy & Dealer Operations for the End-User
This will enable the automobile manufacturer to commission the dealers and easily support the end customers' use of mobile and navigation devices as well as enhanced end-user services, such as directed ads, campaigns and service details.
Infonova BSS Release 6
Infonova BSS R6 is a latest technology solution that can sustain and deliver transformation scenarios and complex business models at a fraction the cost of traditional integration scenarios.
Infonova BSS R6 is specifically designed to support Telco 1.0 and Telco 2.0 business models simultaneously: triple & quad play bundling, white labeling, rich wholesale products and innovative partner models. Infonova's platform helps optimize existing business models and supports flexible intercommunication between legacy and next generation systems. The proven Infonova BSS product family modules cover the enhanced 'Order-to-Cash' lifecycle: Platform and Business Management, Product Management, Customer Management, Order Management, Billing and Finance.
Piloting New Business Models
Older technologies can take years to configure. Encapsulating decades of knowledge, Infonova's latest BSS product, Release 6 is a J2EE order to cash platform that is designed for real multi-tenant order to cash operations for fully convergent and complex business models. Piloting new models can be undertaken in weeks... the Infonova BSS Release 6 is already available in the "cloud".
Telco 2.0 CEO Simon Torrance discusses the challenges of new business models and network transformation with Andrew Thomson of Infonova in a TelecomTV interview...
Infonova was founded in 1989 and delivers highly automated IT solutions for Telco & Media companies. Infonova's BSS solutions have been implemented for incumbent, attacker and cable operators supporting triple & quadruple play service portfolios. For more information, please visit www.infonova.com.