If transformation has a business goal and convergence a technical goal, then surely one of the challenges that faces service providers today is how to navigate a commitment to both at the same time. The problem is only complicated by the fact that transformation, unlike convergence, has no established formula or timetable. It's hard to get management support for something that, except for the goal itself, seems rather hazy.
The goal of transformation is to define a business strategy that creates sustainable revenues and profits from next-generation network (NGN) investments. Meeting that goal may require different specific technologies and services, but it can be accomplished with a general program that has some defined elements and timing recommendations. It is also important to address a few considerations or recommendations of what not to do, because some steps that are often taken are rarely successful.
Five steps to creating an NGN transformation plan
1. Picking a specific NGN service target set: This is the most problematic of all transformation steps. The most significant difference between the service environment of the past and that of the present is the short-term nature of buyer commitments to service paradigms. Basic voice and connectivity services are long-lived, in large part because they are so basic. As operators attempt to monetize NGN services, they must contend with the fact that the most valuable services to an operator are also those most valuable to service consumers, and this value proposition will change over time.
If committing to an inflexible NGN service strategy is exactly the wrong move, the best move is to create a service-layer architecture with the greatest flexibility possible -- both in terms of the way it can compose and combine service features and in the delivery options (wireless, wireline, computer, TV, phone, etc.) available. In fact, the difference between an IP network and an NG
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N is in the service-layer flexibility. IP alone simply creates a connectivity base that will be exploited by others but may not be profitable. NGNs must ensure the profit by providing services in a flexible way, not just transporting their traffic.
2. Restructure network, operations and business management systems around services, not technologies. In the second transformation step, the NGN service set will differ from the old set in that it will be made up of shorter-contract-period services with much wider markets. This means that inefficiency in service operations cannot be tolerated, or the costs will mount to swamp the budget. There are standards processes under way to guide this resetting of operations priorities, and many vendors already have tools and plans to support the switch. Services are the product of service providers, and management systems must reflect that reality.
3. Classify service opportunities at the high level. There is a taxonomy of service opportunities, starting with the basic classification of the customer (residential, enterprise, small business) and the nature of the value proposition the service will have for the customer (communication, data exchange, collaboration, hosting, software and computer outsourcing, etc.). For each opportunity element in the structure, there will be a total addressable market and a likely market penetration curve, and these can be used to set service opportunity priorities -- but not yet.
4. Identify the infrastructure implications of each of the opportunities. The goal here is not to plan out every piece of equipment or technology direction but rather to group the opportunities according to the type of infrastructure investment required to support them so that co-dependencies can be identified. In terms of an NGN transformation plan, the right answer will probably come by picking the opportunity group that has the best relationship between cost of infrastructure and benefit in terms of opportunity value.
5. Implement and execute a project to create an effective NGN transformation plan. The final step is a project to execute in the direction that is identified by the last step listed above. At the same time, the incremental steps involved in addressing other related opportunity groups should be explored to develop a plan for later investment and service deployment.
Projected timeline for an NGN transformation project
Most service providers have the information needed to support this sequence. If that is the case, operator experience seems to suggest that a task to complete the first three steps would require approximately eight months, assuming that work already done could not be leveraged. Service-layer deployments generally require about that same time for initial deployments, and so it may be that the operations processes in step 2 will be the inhibiting factor in preparing a quick response. This suggests that it is highly advisable that operations restructuring be given a high priority.
Every NGN program will be different, and every operator will have completed some of the tasks associated with each of the steps outlined here. An inventory of activities is often very useful in ensuring that nothing that has already been done is wasted, and this will also produce a faster path to NGN success.
About the Author: Tom Nolle is president of CIMI Corporation, a strategic consulting firm specializing in telecommunications and data communications since 1982. He is a member of the IEEE, ACM, Telemanagement Forum, and the IPsphere Forum, and the publisher of Netwatcher, a journal in advanced telecommunications strategy issues. Tom is actively involved in LAN, MAN and WAN issues for both enterprises and service providers and also provides technical consultation to equipment vendors on standards, markets and emerging technologies. Check out his SearchTelecom networking blog Uncommon Wisdom.
