• Telcos need a revolution in their thinking for the next phase in their evolution, say Appledore Research analysts 
• First they have to disaggregate everything; then they have to open up their networks so that anyone, anywhere in the world can consume its capabilities
• It sounds like a stretch for today’s telcos so will it, can it, happen? 

“If we’re really to get the benefit of software networks there needs to be a revolution in thinking,” says Francis Haysom, Principal Analyst at  Appledore Research, very much echoing my mother’s similar thoughts on the advantages of not wearing warm clothing inside - wait until you’re about to go outside, so that you get the benefit, she was apt to say.  

Or, to put it another way, “think ahead, and get your timing right.”

Francis Haysom and Robert Curran, Consulting Analyst, also at Appledore Research, believe the business model objective should be for telcos to work towards becoming ‘telecoms platforms’, and they’ve spelt out their thinking in a report entitled Telco as a Platform: Disaggregating the Telco to Create Value. 

It’s not a new idea, but Francis and Robert express it well and the ‘disaggregated telco as a platform’ actually chimes with the conclusions of several of our recent events where it was decided that telcos were facing big problems in the cultural change department. This paper picks up where those conclusions were left as delegates made their way to the after-event drinkies. 

The revolution in thinking needs to be “to disaggregate everything that I’m doing in my network and I need to make it as easy as possible for anyone, anywhere in the world to consume that capability,“ says Francis.

That’s a radical thought for telco organisations that are used to owning the ‘soup to nuts’ of their consumer relationships and the services that go with it. But that change in thinking has to be quite wide ranging, he says. 

So what are some of the signs that a telco has or hasn’t changed its thinking

“If a telco is still really thinking  about ‘service orchestration’ then they’re still really thinking in terms of a workflow. And if that’s the case they’re not really talking about a true scale up, scale down, overlining and domain orchestration,” he says. There’s clearly a long way to go.

“Most of the virtual network functions today are still fairly monolithic and quite like the physical network functions that they replaced, but things are beginning to change,” he says

Eventually a growing cloud native’ ecosystem will start to put the skids under the old telco model and, Francis says he thinks we’ll see a divergence which will spur on other players. 

“Take Rakuten. It will be truly revolutionary and if they do only half of what they’re promising at the moment they can be a huge disrupter in the market. They probably have an operations cost that’s about half of any other operator and, more importantly, they have an innovation platform tied to what is effectively Japan’s Amazon.”

“Once the teething problems are behind them I think you’ll start to see an order of magnitude change in the ability of a company like that to innovate new products and change things. And I think that process will create a kind of tipping point.” 

If telcos like Rakuten can make the change then it’s going to drive others to keep up, he says.

In the report the authors say that  many telcos still seek the “holy grail” of the next killer application. However, the stark fact is that telcos have not innovated at the same pace as cloud providers and are unlikely to find that ‘killer’. 

However Appledore believes that telcos have a new opportunity in front of them. To take it they have to disaggregate their network services and to extend their core competency to create new adjacent components where they have advantages. Services such as security, QOS, and authentication. 

The authors claim that “telcos can create value and growth from having a disaggregated network (not simply saving cost by disaggregating it).”

“Telco as a Platform can provide the foundation for telcos to assemble and build services for a larger ecosystem, based on their core network capabilities. This can be both  as a value-added supplier of network-based services and as an efficient utility supplier of underlying network services.” 

The paper, Telco-as-a-Platform - Disaggregating the Telco to Create Value, has just been published and the accompanying blogpost features a free download of the executive summary.