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An interview with Karsten Lereuth, President Global Telecom
Markets, BT Global Services
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By Alan Burkitt-Gray, Global Telecoms Business
The first of two instalments.
- BT is still at the early days of the 21CN rollout in the UK. Why are you starting this before there's a track record?
- We are really not in the early days with this programme any longer and the track record does already exist. 21CN is built on robust foundations, with an extensive trialling and testing programme having been completed before the first UK customer migrations (announced on 28th November). Already more than 36 million customer calls have been successfully carried over an Internet Protocol (IP) link during the trial stage.
On top of that we do have already announced the signing of a new customer for 21C Consultancy Services - Turk Telecom - and will make further announcements in due course.
In 2006, Frost & Sullivan even presented BT with its annual award for wholesale network service innovation in the Asia Pacific region. The award recognised BT's achievement in transforming its wholesale business to become a long-term solution and service partner for its customers.
- What is BT's target market in offering 21C consultancy services - incumbents in small/large countries, altnets, cable operators, mobile operators, ISPs, wholesale operators, and so on?
- The GTM organisation is serving the needs of communications providers globally outside the UK market.
GTM is expecting the most significant growth to come from our new 21C Operator Services portfolio, including the BT 21C Transformation Services, which addresses the NGN transformation of other operators along similar lines as BT's own transformation with our 21CN project. The whole solution consists out of three propositions: BT 21C Consultancy Services, BT 21C Build Services and the BT 21C Managed Services.
The key potential for the BT 21C Transformation Services has been identified with the key communication providers in growth markets like MEA, Asia Pac and CEE, where operators with significant legacy environments now need to move to the all IP world, due to deregulation, new competition and the ever growing expectation of customers for new services and a better customer experience.
- What is the particular offering BT can make to each of those sectors?
- The main target group of communication providers we are aiming to serve can be divided into four key sub segments.
Fixed network operators
By implementing a next-generation network, they can consolidate their infrastructure and reduce expenditure. A next-generation network can also provide a future-proof platform to help them develop and launch new products and services as quickly and cost-effectively as possible and maintain market share. The infrastructure offers a wide range of connectivity options for voice, video, data and converged communications. And it gives them a platform to help deliver the consistent quality and innovation their customers are looking for.
BT has exceptional business and technology expertise, and wide-ranging experience in next-generation network transformation. Operators can focus on their customers while BT builds, designs and maintains a new, more efficient network.
Alternative fixed network operators
Alternative fixed operators are less restrained by legacy networks than other fixed operators and have fewer constraints: they are more agile and flexible.
These operators must actively seek new customers and quickly launch new services. They need a future-proof network to remain competitive. While a single collapsed IP core and new technology will help control cost, it is the next generation organization and processes that can help accelerate a new entrant or alternative operator into leadership status in its market. The ability to spot market opportunities, quickly and profitably delivering new services to address those needs, is what will set an operator apart to give it competitive advantage in an already crowded and fast moving market.
BT's experience in Next generation OSS / BSS and organizational transformation can help them to derive the most value from their NGN investment by ensuring that the systems and processes are streamlined as well.
Mobile operators
Customers have an insatiable appetite for new mobile services, and product lifecycles are short - so short that new technologies quickly become commoditised. New services must be brought to market as quickly and cost-effectively as possible.
Mobile operators have experienced huge growth across developed countries and are now expanding in emerging markets. Here, mobile operators need to make cautious investments while quickly launching new services - there is a vast amount of competition in emerging areas. These operators also need to merge content and media into the product mix to create a more enticing offer.
BT has developed content services for delivery over its fixed and wireless broadband networks and led the market in delivering broadcast TV to cell phones in the UK. Its 21st Century Next Generation network allows for the acquisition, ingestion, and distribution of content regardless of source or access medium.
A BT powered next-generation network offers the agility that mobile operators need to quickly launch new services, to deliver feature-rich content messaging services and advanced customer relationship management services for their customers.
Cable operators
Cable is well established in most developed markets around the world. Cable operators' expertise in acquiring content and digital rights puts them in a very good position to maximise their return on investment. By offering Voice over IP (VoIP) services - cost-effectively delivered over existing broadband infrastructure - they are also capturing market share from the traditional network operators and offering the 'triple play' of voice, high speed internet and video.
But as increasingly value is derived by the applications and services offered over a converged network, Cable needs to be better able to address the challenges from fixed telcos, from alternate internet service providers as well as from Mobile operators. No longer is the simple bundling of services enough to ensure you remain competitive and win market share - you must constantly innovate new services for consumers and do so more quickly.
BT has extensive experience in the development and provision of converged applications and has created a 21st Century infrastructure that allows it to rapidly innovate across the organization. Service Oriented Architecture (SOA) and service development tools deployed over its core NGN allows BT to create products in a faction of the time it used to (down to 3 months from 18 months for some). BT has become expert at deploying applications and services for mobility and mobile users over its fixed and Broadband wireless infrastructure and can help Cable Operators exploit this market opportunity as well.
- BT is one of a very small number of operators planning what KPN calls a "no-overlay" rollout of NGNs. Why are there so few at the moment?
- We can not speak for other market participants and about their decision making processes but we can tell you about the drivers behind our 21CN.
BT's 21CN programme is primarily aimed at developing a truly customer-focused efficient infrastructure that will allow communications in a range of formats across an Internet Protocol (IP)-based network. 21CN will replace the complex network and systems infrastructure with a physically simpler and more reliable network, to ensure the delivery of the next generation of converged services faster, more efficiently and more cost-effectively than ever before.
Essentially BT will collapse its 16 separate legacy networks into a single network capable of supporting voice, data, internet and video services, seamlessly. Based on IP technology, 21CN will offer a single platform that supports multiple services, rather than multiple platforms supporting single services. The converged core of the network will have 100, 000 fewer elements to maintain, resulting in lower operating costs for BT.
End customers - both business and consumers - will benefit from a range of new converged communications services. Ultimately, the new network will be aimed at providing flexibility - including mobility - and personalisation so that customer communications are seamless, secure and offer multi-device capabilities. For example, 21CN will provide the infrastructure, which can enable customers to access voice messages, data or video on any device at anytime; or so that customers will never have to think about bandwidth because it's as wide as required all of the time.
- How many others are actually planning to follow this strategy?
- Due to the strategic approach of our business we do naturally speak a lot to communication providers across the world about topics like this. Without going into too much detail here we can clearly state that our previous conversations/meetings have indicated that most communication providers have realized the need to transform their business in the near future if they want to survive long term. With BT´s 21CN being seen by most of them as a positive benchmark for a bold and radical approach there is definitely a huge momentum for the new positioning of our unit, which now is to be a provider of capacity and capabilities.
- If so, what sort of operators are likely to be first? And why?
- For the business world, history shows that organisations constantly adapting to the changing environment have more chance of being competitive and a better chance of assuring their futures.
In the carrier world today, survival also depends on adapting. Specifically, it means being willing to transform the networks that form the backbone of the industry. We're all familiar with evolutionary pictures of our stooped ancestors slowly growing taller and straighter as the years go on. I would liken this to the evolution of networks. Old, stooped networks just don't give the functionality that customers now require. Today's network needs to stand tall and straight to cope with the many demands being placed on it by both customers and rapid business-growth.
What's worrying is that many networks are still firmly lodged in the past. The ageing network simply has to give way to the next-generation network for any chance of a successful and profitable future.
It's all very well saying that you have to change your network to survive, but it has to be done in the right way. If not, then network transformation will not be the enabler it can be, but a drain on a company's resources - in terms of time, expertise and money.
- Are there reasons for delay? For example, some may want to wait till the technology settles down and prices fall.
- The "sit-and-wait" attitude could mean a death sentence for a communication provider. In today's world, where the pace of change is more relentless than ever, only organisations that can keep up will be able to survive.
Currently all communication providers are faced with the same dilemma - considerable legacy network architecture, which is costly to run and allows for only limited product customisation. This is at a time when customers are demanding increasing product and service flexibility and simplicity (e.g. one bill and service level agreement for all communications services), all at lower cost. Telecoms operators therefore require new infrastructure that simplifies connectivity, reduces running costs and allows for more service innovation and flexibility for end-customers.
Communication providers are under immense pressure to boost the quality and range of their services to meet customer expectations. As a result, they need to develop a strategy to deal with market changes - and fast.
See the second instalment of this interview in the December issue of Global Telecom News, where Karsten will talk about the support BT offers to operators planning an NGN rollout.
This interview originally appeared in Global Telecoms Business and appears with permission from the publisher. |
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