Its one of those trends we know is there. Its been there for decades. However, because the trend is constant it gets ignored, its a bit like boiling frog syndrome – ignoring the small changes until its too late and you’re cooked. The trend is the ITization of telecoms. Within the telecoms industry we like to think that there’s IT (Information Technology) and CT (Communications Technology) and a category called ICT (Information and Communications Technology.) But really telecoms is a subset of IT.
Using ITIL’s (www.itil.org) definition of IT: “The use of technology for the storage, communication or processing of information. The technology typically includes computers, telecommunications, applications and other software. The information may include: business data, voice, images, video. IT is often used to support business processes through IT services.” Most telecom networks are now just software running on servers, that looks like IT to me.
So this isn’t a merger of technologies, rather a take-over. Drawing on a few examples:
- IP was an enterprise technology (when it achieved scale) that is now the core of telecoms instead of ATM (Asynchronous Transfer Mode);
- SOA (Service Oriented Architecture) is an IT workflow bus that is now the core of an operators’ business operations;
- iPhone app store implements an on-device portal that telecom operators had offered to them since 2002, yet its taken Apple to show the industry how to do it; and
- TMF (TeleManagement Forum) will be replaced with ITIL (Information Technology Infrastructure Library) because enterprises use ITIL not TMF and operators must talk the language of their customers.
The reason IT wins is scale and time to market. All enterprises (non-telecom industries) combined provides a scale greater than telecoms, but more importantly massive innovation potential given their varied needs. Also IT’s approach of rapid evolution delivers, i.e. start small and feature rich, then rapidly evolve into 5-9s (99.999%). In fact, for some industries ‘5-9s’ availability is inadequate, zero downtime is required in financial services and they’re processing transactions in micro-seconds not the milliseconds of Telecoms.
When making decisions on strategy, products and services, if it looks like a telecom special best avoid it as there’s likely a much cheaper off the shelf IT solution which just requires configuration. The last point is important because most operators think their processes are a source of competitive advantage (they are not from a customer’s perspective), hence operators generally avoid using an off the shelf solution. They know a fully customized solution is too expensive, hence heavily customize an off the shelf solution which is the highest risk (hence the high failure rate in many telecom business transformation projects) and in the end spend nearly as much as a fully customized solution.