The Next Stop, M2M: Biggest Trend of Our Time?

During my recent attendance at Management World Americas, it became clear that the subject of machine-to-machine communications (M2M) had progressed from the innovative discussion stage into concepts and uses within real industry verticals.

I listened to an interesting session in which the presenters noted that M2M may well, in fact, be the biggest trend of our time; however, as it currently provides only one percent of mobile revenue, communications service provider (CSP) investment is being held back.

What the market seeks is a one-stop approach, or umbrella solution for connectivity and M2M applications—similar to the Ethernet-exchange or Cloud-broker principles currently being seen across the industry. Through this approach, there’s great potential for growth, particularly for value-added services, if CSPs can prioritize and exert discipline in M2M investments and resources.

Vendors focusing on specific vertical markets will be ideally placed to gain a seat at the table, as many verticals, such as utility, healthcare, manufacturing and retail, use some form of M2M. But as sure as death, tax and CAPEX reduction, CSPs are looking for a quick return on investment (ROI), and in order to improve time-to-market, they must first invest in the right enabling technology.

To truly succeed, they will need to build an enablement framework that includes a connectivity model, device templates, collection and data analysis—assuming that the 3G/4G network is either in place or under construction. Within this framework, a defined catalog of specific service descriptions, superior scalability and automation are all necessities, as is using collected data to make analytical assessments and provide proactive resolutions to problems. Some good examples include using smart-grid meter data for innovative pricing, or using automotive data to aid in preventative maintenance and warranty cost reduction—these, of course, are not even one percent of the potential uses of M2M technology.

A key concern related to the implementation of M2M is the massive IP scalability required for end-devices, and industry forums are already investigating how IPv6 will have a leading role to play. Another way to help address these concerns is through just-in-time device activation or dynamic SIM management, where retailers or equipment wholesalers can enable devices at the point-of-sale—bringing significant cost-efficiency. This approach could typically be welcomed in the impending introduction of new, SIM-enabled vehicles rolling off the production line.

Ultimately, initial reluctance of CSPs to make investments in M2M needs to be offset with assurances around operational efficiency and acceptable ROI dependent upon time-to-market. This coupled with an ability to automate, maintain cost control, billing models and OSS are key considerations CSPs must make in order to play in this opportunity-rich space.

Three Certainties in Life – Death, Tax and CSP Cost Reductions

A trip to Orlando in November to experience the weather of an English summer had the added bonus of finding TM Forum’s Management World Americas in the wonderful Peabody Hotel and Conference Center.

Some clear positivity has been demonstrated in the telecoms IT industry over the last year. The “Cloud” has been gaining further momentum, machine-to-machine (M2M) is finding new innovative applications across enterprise verticals, and communications service providers (CSPs) are realising the value of eco-system-delivered services.

Amidst rapturous applause, Martin Creaner opened Management World Americas by acknowledging (for a change) that we all knew what challenges are facing CSPs and the market, and that vendors and OSS/BSS solution providers should be getting on with delivering innovation. He stressed that the event was all about putting competitive engagements to one side, collectively learning how peers are addressing challenges and how, by sharing ideas one or two times a year, everyone could really contribute to creating a better world—quite profound and worthy of a Nobel Prize, I think!

To summarise a relatively light-hearted introduction, Mr. Creaner recommended the following points of wisdom and focus for the coming year:

• CSPs will be concentrating on growing new revenues to combat declining asset value, whilst maintaining customer experience to minimise subscriber churn.
• New revenue streams will come from clever product bundling and marketing, service enhancements, such as location-based services, plus some early adopter M2M innovations (e-health etc.), which are great ideas but carry investment risk if they are not successful.
• Over-the-top (OTT) players are here and will not be going away, so CSPs need to fight for their place in the value chain. Making a broader portfolio available in the broader market is key, such as offering diversified services within the cloud.
• CSPs need to leverage their assets and operational experience to become cloud service brokers.
• Death, tax and CSP CAPEX/OPEX reduction are the three certainties in life.

Management World Americas Video: Diego Becker on Show Trends

Between meetings, presentations and all the other happenings at Management World Americas, we managed to steal a moment of time with Comptel’s vice president of the Caribbean and Latin America (CALA), Diego Becker, to discuss his thoughts on the event. Customer experience has been a common theme at the show, and in this short video, Diego expands on this and shares some thoughts on additional trends he’s seen arise from the event. Take a look at the below video for an update from the Management World Americas floor!

More from Management World Americas: Why Attend Tradeshows?

This was the question TM Forum’s president and CEO, Martin Creaner, posed during Tuesday’s keynote speech at Management World Americas in Orlando. He noted that almost everyone in the industry is aware of the current challenges facing and opportunities awaiting communications service providers (CSPs), from increasing pressure on revenues and the threat of cyber security, to the potential of data mining and the impact of new regulations. With competition at every turn, Creaner believes that CSPs must transform or risk being relegated into dumb pipe status—delivering someone else’s services to someone else’s customers for a low return.

And the real value of attending tradeshows and conferences isn’t to find out about these trends, but rather to explore how our peers are addressing them. And it seems that every CSP’s strategy is centered on growing new revenues while maintaining a superior customer experience.

CSPs are looking at innovative marketing techniques, new pricing models and more, in order to grow revenue and offset the erosion of traditional income streams. They’re also looking at innovative content services to generate complimentary additional revenue, with things like smart grids, M2M and mobile payments. These all have huge potential but also pose huge risks because, as Creaner said, you don’t know what you don’t know.

In that same vein, it’s a reality that OTT players and complex value chains have a distinct presence in the market, and the only way to assume a role here is if the CSP can add value. Creaner believes that the fact that CSPs own a network, or own lots of customers is not enough—to penetrate the OTT market, they will need to prove they are adding a particular value that the whole industry needs.

Ultimately, when it comes to maintaining and growing the customer experience, a holistic view is needed. CSPs must focus on end-to-end customer experience management and be in a position to manage service quality across the key value chains.

We’re excited to continue this conversation with colleagues and peers at the show, approaching Management World Americas and the ever-changing telecom world in general with an open mind.

Management World Americas: Cocktails with Comptel and Discussions around Data

This year’s Management World Americas, taking place in Orlando, Florida, is buzzing with excitement and even may be the biggest yet, with a rumored 500 attendees! To kick things off, Comptel hosted a cocktail reception on Monday evening for press and analysts, which involved a lively discussion around OSS/BSS industry trends, particularly fulfillment. At the reception, Comptel’s CEO Juhani Hintikka presented the company’s strategy and described how Comptel is addressing the most pressing issues challenging communications service providers (CSPs) today.

One of the most prominent hurdles is the volume explosion – with mobile data making up 30% of traffic, and still growing, and video traffic alone expected to consume 66% by 2015. Juhani asserted that this should be seen as an opportunity rather than a challenge: if that data can be turned into information, this would create a basis to really differentiate and enhance customer experience.

This is especially true when it comes to over-the-top (OTT) players. Instead of competing with them, CSPs must begin to think of how to work with them, bringing to the table some key assets. Those assets include the control of the network, the BSS/OSS infrastructure (being able to deliver and charge for services), but also potentially the understanding of customers – which is where turning data into information comes into play. In other words, OSS plays a role in creating a reliable ecosystem that is attractive to potential partners.

However, CSPs are not there yet. What they need is to be able to turn data into actionable information, or as Juhani put it, deliver on the new paradigm: event – analysis – action, in real time.  In other words, Juhani believes the real value is to act in real time, jumping on an issue when it’s hot instead of letting it fester. If you can get the analytics right, you gain an opportunity to increase revenue – adding value rather than simply pushing a technology.

This message was well received by the press and analyst present at the event.

Stay tuned for more updates as we take in all that Management World Amercas has to offer!

Gearing Up for AfricaCom in Cape Town

On 9 November, the 14^th annual AfricaCom event kicks off in Cape Town, with the organisers expecting a record attendance, which they are predicting to be 12.5% higher than last year.

While I’m sure that the scenery and activities of Cape Town draw attendees, it is also certainly a reflection of the silver lining that Africa is to the economic cloud that hangs over many developed markets. For anybody in the telecoms industry, relatively high subscriber growth and low mobile penetration create compelling reasons to be doing business in Africa.

But, of course, Africa also has its fair share of challenges, most of which boil down to one thing: how to ensure profitability in highly competitive, price sensitive and sparsely populated markets. Most of the focus so far has been on controlling costs to enable pricing competitiveness—lean operations being something that the Comptel Dynamic OSS portfolio supports very well.

But this is only half the equation against a backdrop of high churn in Africa. As is generally recognised, it is almost always more expensive to acquire new subscribers than to keep them. Ultimately, African telecoms are entering a new battle for the ‘hearts and minds’ of their subscribers in a quest to create a ‘stickiness’ for their hard won subscribers.

So it is encouraging to see that the tagline for AfricaCom this year, “Advancing Innovation & Profitability for a Digital Africa,” is recognising this key link between innovation and profitability.

Please do come and visit Comptel at Stand F5 at AfricaCom this week to discuss how we can help operators win the ‘hearts and minds’ of their customers through innovative OSS solutions.

In Search of IT Talents

Comptel is once again attending the TalentIT Career Fair on Thursday, 3 November in Dipoli, Otaniemi, near Helsinki, Finland. This is the very same location where we held our 14^th Comptel User Group earlier this year. Otaniemi is also the home of Aalto University School of Science and Technology where many Comptelians have received their Master of Science degrees.

The event is an excellent place to present our company and meet the future talent in information and communications technology. Last year, the fair brought more than 60 companies and 2,000 students together! While the competition for talented employees is fierce, Comptel has a lot to offer. For example, we are just the right size; Comptel is big enough to offer many global opportunities, but at the same time, we’re still small enough to be agile. And of course, we have been in business since the late 1980s (when most of the students were not even born!).

As a software house, Comptel offers a wide variety of jobs, ranging from software development to engineering to sales and customer services. And our flexibility makes it possible for employees to find the right fit for them. In fact, quite a few engineers have moved to business development and sales. As a truly international company, having delivered our solutions to 85 countries, Comptel hires engineers irrespective of nationality—non-Finnish speaking colleagues are rather the norm than the exception. We also offer opportunities to relocate to other Comptel offices, with Kuala Lumpur, Malaysia as the most popular destination at the moment.

But first, we need to get students’ attention at our booth. This year, we are running a short, simple (that is not how I would describe it!) programming quiz. The lucky winner will return to his or her campus flat with a trampoline! After all, we are the people who like to reach new heights in this industry.

Customer Experience – The Final Frontier

Day one of a well-attended OSS-BSS World Summit in London, and the talk is all about customers. Networks, even handsets, are little mentioned, and bandwidth and bytes seem like yesterday’s unhealthy obsessions—the customer experience is now paramount, and henceforward, all shall be customer-centric.

Fine words and, many would argue, not before time—but what does it all mean in practise?

It could mean, as Charlie Hunter-Schyff, new media planning head of O2 demonstrated, applying analytics to location information to derive better-focused customer promotions. It could mean more sophisticated blending of policy control and charging functions to create a finer-tuned customer experience—an approach championed by Comptel. Less thrillingly, but perhaps more realistically, it could just mean, as indicated by Matthew Mason, director of billing and collections at Du in Dubai, and a compelling speaker, getting your act together in pretty much every department and making sure every process from order fulfillment through trouble ticketing to billing is as slick, faultless and efficient as it can be. That, after all, is what makes a customer perceive a company as excellent, and what makes customers stick around, spend money and even promote you to their friends. Perhaps this is the difference between having a customer-centric organisation and applying customer experience management (CEM).

What does it mean to software vendors? Really, it means that for any product or solution—not just CEM products—to be taken seriously, they need to be couched increasingly in the context of the customer experience. Does my fulfillment deliver a slicker, more faultless and trouble-free experience for my customer? Does my charging platform allow customers the payment options they appreciate? Is my policy control focused on the network or on my customers? Do all of these functions act together to allow me the holy grail of customer management, a ‘holistic’ customer view which pulls together customer information from CRM to HLR and lets me provide a wholly personalised service?

There is a compelling sense of real possibility around the customer, as Susan McNeice from Yankee Group observed in a speech at the end of the day. This feels like a real tipping point in industry attitudes and behaviour. Many communications service providers are genuinely and rightly excited by the prospect of turning to their advantage a customer understanding which would be the envy of most OTT players, and using it to create a value proposition for which the customer would be willing to pay a premium. They are sensing the possibilities—and now is the time for vendors to step up to the plate and demonstrate how they can be realised.

Comptel’s Second Day at Management World Africa 2011

Phew! The second day of TM Forum’s Management World Africa 2011 is over. Now, I’m back on an airplane but this time to Cape Town (where Comptel has an office). Before landing, I again reflected a bit on the speech I gave on “taking personalisation to the next level—exploring how communications service providers (CSPs) can optimise customer retention and profitability through SIM management.”

In the afternoon’s presentation, I explored how CSPs across most parts of the world run their prepaid businesses, giving relatively little choice to users, mostly pre-provisioning the data and logistically managing many types or packages of SIM cards. Basically, SIM packages define the product one buys with or without a number attached.

I then expressed what the basic choices of personalisation are (price or product) and raised the question of segmentation. Aren’t we already in the stage of various types of micro-segments where two people in even the same village in rural Africa, let alone in urban cities, likely won’t have the exact same desires and expectations of CSPs’ services? If we start looking at the number of devices we use and the usage patterns we have, we would find that there is hardly any commonality, except that we all call and use data services—but that is not granular enough to address our need for personalisation. We have a vast amount of segments to address today, and the old mechanisms for defining products with varying prices and other parameters need to be rethought; otherwise, they will lead to non-personalised experiences and low customer loyalty.

I went on to explore if the mechanisms of trying to guess what is hot or not is valid—ultimately suggesting that CSPs do not even try. Let users select the services and value-adds they are interested in, and enable them to choose these elements themselves. My conclusion: loyalty is driven not only through quality but also through personalisation. If we allow users to self-personalise the services they take from their CSPs, how can competitors offer anything better?

Like I wrote yesterday, catalog is left, right and center of this kind of approach, but the way we fulfill service orders needs to be well coupled with the catalog data. If you want to know more, we’re happy to discuss it with you—it’s a bit of longer story than a blog post really.

Overall, it was a tight 15-minute session with a Q&A with the audience, and there was much more positive discussion afterwards 1-on-1 with the CSP community present.

On The Way to Management World Africa 2011

I’m writing this while travelling to TM Forum’s Management World Africa 2011 in Johannesburg, South Africa, where I’ll be giving a speech on “taking personalisation to the next level—exploring how communications service providers (CSPs) can optimise customer retention and profitability through SIM management.” (Despite most of my blog posts having been about IMS or LTE, this one won’t.)

So while flying on the Airbus A380, which, by the way, is the most advanced aircraft I’ve ever travelled in, I started to think about how telcos, in general, fail at personalisation and why they should really take a serious look at other sectors like the airline industry. A major difference can be seen when comparing the way CSPs and airlines price their offerings. Telcos, for the most part, have fixed pricing with tiered costs based on peak and off-peak hours, but they don’t really personalise it at all. Whereas airline fees vary depending on the time of your flight, the number of passengers on that flight, etc.

Then, taking it a step further, upon booking, airlines personalise all communication based on your mileage program level. You can also choose your seat depending on availability and class of service, and sometimes have the option of special meals or drinks. Even after landing, I will be picked up by a personal driver, who has my name on a large sign to help me find him in the crowd.

Looking at it, aircrafts like the A380 are complicated ‘monsters’, technological masterpieces on their own. However, the airlines do not really sell the technology—but rather the experience. And although the personalisation is limited somewhat, it is still much more than just an SMS informing you that the European Union regulatory data caps and prices are valid when you’re roaming, for example.

I will be presenting around this topic and how CSPs can make personalisation real for customers. The key elements needed to see it through? Comptel believes it’s a full-fledged fulfillment suite. Comptel Dynamic SIM Management uses a configurable dialogue engine to drive user interaction, backed with Comptel Catalog to ensure that the products defined can actually be delivered with a service and resource inventory for numbers and SIM-related data and, of course, real-time Comptel Provisioning and Activation.

I know this will be published after I land, but thought of writing this to begin to explore the issue of personalisation. I will continue with this direction during Management World Africa and in some blog posts to follow.