Blogposts

Network Automation: Telecom is dead, long live Telecom!

Telecom industry of the past was basically much-needed utility companies operating like cartels.

Granted coveted licences by the government, they built a whole network, sold the network connectivity services, made sure it ran OK, resolved customer issues—then the cycle was rehashed millions of times.

In that business, you wanted to sell (dumb) pipes to as many customers as possible and as much bandwidth as they could support. Competition was controlled, and barriers to entry were high.

Then, in the early days of public Internet, the emergence of demand for both voice and data created Telco 2.0. The development of 2G and 3G led to a richer landscape of point-to-point global connectivity, and basic enterprise adoption.

By the time the killer apps—4G, the smartphone and cloud computing—reached critical mass, competition had exploded, and running a Telco 2.0 had become a strain.

The democratisation of connectivity

Telco 1.0 and 2.0 had sold connectivity using the traditional network. 

Along the way, the skyrocketing demand for higher bandwidth, quality of service, and range of enabling options had necessitated that telcos ramp up traditional networks to breaking point at the prospect of lower profitability. 

Now, the global need for digital transformation will be the final nail in Telco 2.0’s coffin.

As we know, the souped-up traditional telecommunication networks of today are impeding innovation rather than enabling it. 

Solutions such as real-time communications (RTC), direct cloud connectivity, machine-to-machine communications (M2M) and the Internet of Things (IoT) had been the harbinger of trouble for telcos. 

Of course, the next big thing that telcos are banking on is the rollout of 5G to meet IoT development needs, but the tiny low-powered sensors of IoT and IIoT are not expected to need much value-add from a telco. Even Wifi-6 can be deployed as needed if telco 5G services are not practicable.

Meanwhile, the ICT market has used telcos to prop up only their basic needs while moving on to networks of the future for the real business action. 

It took a while for cloud technology to reach its current level of sophistication and versatility, but its time has come. Cloud-based services demand the support of flexible, agile and efficient programmable networks, and this need is being met independently of telcos.

Networking needs to be reinvented, and six strong drivers are pushing hard:

1. Cloud computing has gone mainstream, and antiquated networks that stand in the way of progress will be bulldozed into oblivion.

2. Anything-as-a-Service (XaaS) models have become a mainstay in every sector, and only high-performance networks with agility, reliability and scalability will suffice. 

Data centre operators with a networking foundation are now giving telcos a run for their money. Even data centre operators without telecom expertise can rely on partners possessing that foundation to offer best-in-class competition to the telcos!

3. The DevOps phenomenon is generating unprecedented levels of innovation to meet digital transformation needs. And one of the key requirements is embedding best-in-class connectivity—using application programming interface (API) for automating services—that traditional networking cannot offer.

4. RTC and browser-based communications are similar embedding connectivity into mobile apps and e-commerce platforms, and traditional connectivity has no part to play.

5. M2M and IoT applications require networks that can scale from serving a finite number of human customers to a billion networked devices simultaneously.

6. Telco 2.0 market saturation, price erosion, competition from OTT and digital service providers (DSP) have deemed legacy services redundant or unsustainable. The new challenge is to support new services effectively and join in the fray while still being able to add a compelling unique value proposition .

The democratisation of connectivity did not happen overnight. 

However, critical mass is now upon us. To be fair, successful telco businesses have actually done their best at evolving to Telco 2.x levels; nevertheless, to reach Telco 3.0 levels, the mandate is legacy Telco 2.0 infrastructures have to be laid to rest first.

What does this all mean to industry players?

The global networking industry is entering an era of extreme change that is reshaping how service providers operate and deliver connectivity solutions. Old models need to be replaced, and innovation must accelerate delivery of connectivity solutions.

What is the rush? 

Well, the global telecoms dream has slowly turned sour. Seen initally as engines for growth, telecom giants have “started to retreat from their far-fling empires.”

According to Forbes, the baton for communications market dominance has been passed to the Googles and Facebooks of the world, which have ironically used the pipes and masts installed by the telcos to great effect. In the meantime, pre-Telco 3.0 left a big gap in communications parity with the digital divide.

The industry is entering a critical third phase, where traditional boundaries and limitations must be removed for a more fluid, elastic and intelligent network.

Telco 3.0 delivers networking that matches the needs of today’s applications, data and services. It is a modern approach leveraging software-defined networking (SDN) for friction-free access to the cloud, data centres, last-mile connectivity and a whole marketplace.

Fully automated, it removes the inefficient manual processes of old, and offers unprecedented levels of flexibility and control.

The caveat is that telcos will not be the only businesses that attain Telco 3.0 levels.

Digital democratisation dictates that any cloud-native business with the expertise and technology can be part of the ecosystem. Some network service providers today do not even have telco experience or own any network infrastructure–behaving more like a software company rather than a telco. 

Case in point: Epsilon has accelerated its transformation from Telco 2.0 to Telco 3.0. 

We have tapped on the maturing cloud platforms ahead of the competition and remodelled our business from a regional wholesale carrier to a global Network-as-a-Service (NaaS) provider. Our network services now supports the world’s applications and services, no matter where you are.

The sirens are sounding. Telecom is dead! Join in—nurture the irrepressible Telco 3.0 movement and never look back!

Author


switchd