As seen this year at Mobile World Congress in Barcelona and Cable Next Gen in Denver, service providers around the globe are grappling to understand the implications of a digital transformation. It appears that service providers in all segments -- mobile, cable and fixed -- are finally faced with the dreaded choice of pursuing an uncertain digital transformation or relegated to being a "wire and cable" or "transport-only" company.
While the fear and confusion over a digital transformation is real, I believe that much of this is a failure to understand the steps of how a digital transformation will occur for service providers and a failure to understand how business service assurance can and will aid in a successful transformation.
Let's begin with the term "digital transformation." By itself, the concept, for a service provider, immediately sounds daunting and fraught with peril. After all, how does one transform an entire network built over many decades and supporting millions of users radically transform without adversely impacting customers, services or revenue?
To put the concept of digital transformation in context, I like to reference a recent article in the Harvard Business Review, "What Do You Really Mean by Business 'Transformation'?" by Scott Anthony. What Anthony does very nicely in his article is break down business transformation into three distinct transformations:
- Operational Transformation
- Operational Model Transformation
- Strategic Transformation
For service providers, breaking down the larger digital transformation concept into these smaller transformations is both helpful and enlightening as they provide both a transformation path as well as parameters around each step. In addition, we can see the changing role of business assurance as a service provider moves from current operations to becoming an intelligent communications platform provider.
The first step in a digital transformation is an operational transformation. With an operational transformation, the service provider employs new technology and new methods to old problems. This transformation poses both challenges as well as opportunities.
We see service providers pursuing this transition through network function virtualization (NFV). By allowing operators to decouple network functions from physical hardware, they are able to dramatically change the economics and accelerate service delivery of the network. They are no longer tethered to the long lead times of ordering, installing, and provisioning dedicated hardware. Instead, they are able to dynamically spin-up, spin-down, and re-allocate network resources as-needed.
Similarly, an operational transformation in the enterprise space is creating an opportunity within the service provider community. As enterprise customers look to modernize their infrastructure and operations, it is opening up opportunities for service providers to expand their cloud-based business services offerings.
Business assurance plays a critical role in this transformation by ensuring service reliability and service visibility. The assurance challenge is providing seamless visibility across hybrid networks. That is, services that are delivered over a combination of physical and virtual hardware. Given the additional complexity of virtual environments, it will not suffice to monitor traffic in only one domain or the handoffs between domains. The operator will require full visibility within the virtual/hybrid domains and within the dynamic environments of virtual networking.
Operational model transformation
On the heels of an operational transformation is a transformation of the operational model -- a reinventing or streamlining of the process. For service providers, this transformation moves them beyond NFV to service and network orchestration. It is dealing with the technologies of software defined networking (SDN), self-optimizing and self-organizing networks (SON), and subscriber self provisioning.
This is a transformation of the operational model for building, provisioning and running networks. It will be as much about re-tooling human skill sets and organizational structures as it is about new technologies. It will foster the development of what Anil Rao at Analysys Mason
calls the Service Operations Center (SOC) which goes beyond traditional Network Operations Center (NOC) functionality to support end-to-end service visibility and reliability.
The role of business assurance, in the operational model transformation, morphs from providing network managers information upon which to act, to providing real-time, closed-loop intelligence to orchestrators as well as end-to-end performance visibility to the SOC. Allowing the network to dynamically configure and reconfigure itself based on service and resource demand, and allowing users to dynamically self-provision services.
While the business assurance infrastructure will continue to provide management reporting on network and service performance, it will now provide real-time information to other elements via expanded APIs. And, this outcome minimizes the interaction of human operators while increasing the efficiency of the network.
The final transformation is a strategic transformation. This is when service providers re-envision their business model as fundamentally different from what it is today because the technology transformation has allowed them to re-envision the business model. Allowing service providers to be innovators and architects in what Analysys Mason, IDC , and others are calling the "Digital Economy."
For service providers, this transformation allows them to move from where they are today, as network operators, to become intelligent communication platform providers and avoid being relegated to the annals of history as "wire and cable providers." It is about service providers viewing themselves as a communication platform for voice, data, video, text, etc. Not tied to a technology or architecture, but about connecting people, ideas, machines, and any points that need to interact with each in a timely, seamless, and reliable fashion.
With a strategic transformation of their business model, the role of business assurance changes yet again. Now, we are talking about business intelligence. Intelligence based on big data- usage patterns, geo-location data, consumer preferences, quality of the experience data and more.
At this stage, we have moved beyond rigid architectures and slow-to-implement services. Now, operators will manage dynamic networks with data that allows them to not only create consumer and business DNA profiles, but the networks will be able to "learn" from the data and define and re-define services in real-time to meet the ever-changing needs of the subscriber.
It is the ability to create unique, individual service offerings that benefit both the subscriber as well as the service provider. With a transformed service delivery network in concert with the application of big data analytics, it will be possible to create individualized service offerings that will truly differentiate a service provider from its competition.
A decision to be made
For today's service providers -- mobile, cable, fixed -- pursuing a digital transformation is not a fait accompli; rather, it is a strategic decision to be made; a decision that some will make and some will not.
For those who do decide that a digital transformation is in their best interest and the interest of their shareholders, they need to understand the value of investing in business assurance throughout the process. It is the data that assurance systems generate, in real-time, that will allow the various transformations to occur while limiting any adverse impact on subscribers, and will hold the key to sourcing data for their big data efforts that will ultimately drive their future. A future that will allow them to fully compete with the Googles, Facebooks and Amazons of the world.
— Mike Serrano, Senior Manager, Service Provider Solutions Marketing, NetScout