Platform businesses are the fastest growing, most valuable and scalable companies on the planet. How can telcos apply the platform model to succeed in the internet of everything (IoE)? We asked three industry leaders for advice at our Internet of Everything InFocus event earlier this month.
The debate began by looking at the essential ingredients and characteristics of platforms.
Rob van den Dam, Global Telecommunications Industry Leader, IBM Institute for Business Value, said: “You have to have data capabilities – whether taking data from drones or videos – and traditional analytics are not sufficient, so you need artificial intelligence [AI] to get intelligence from [the data].
“In the marketplace, you have consumers, developers, other partners and contracts, etc., with them, so in that context, you are dealing with trust and privacy, and must be able to guarantee them. Blockchain is a technical capability that that could help there [although as you can see from this debate, there are serious concerns about this], because IoT has to be secure and cyberattacks are terrible things.”
Van den Dam added that APIs are critical too: “You need all these things for high performance IoT.”
Don’t forget the fundamentals
Fellow panelist Jürgen Hase, Chief Executive Officer (CEO), Unlimit – Powered by Reliance, is based in India where another division of the company, the LTE-only services operator Jio, has massively disrupted the market. Unlimit is a new business unit that focuses on IoE services. Hase had some words of warning about AI:
“To scale it up, my lesson learned is if you jump too early to cognitive [computing, a subset of AI], we create all the wonderful things inside the Ferrari and forget the wheels. All these things need connectivity before you need analytics, and that is not easy in many countries.
“I have also learned you need people with experience. You meet so many people who say they have done this or that, but they’ve only done things in a silo, not in the real world. You need [to involve]a lot of parties such as local people and the regulator because, for example, cloud, where information is processed and stored, has to be a local service.”
He added, “For high performance, you must design in security from the start; often we do wonderful things then think about security and it’s too late. There are many overlapping [rather than sequential]areas.”
Futureproof it or it’s too expensive
Nigel Chadwick is CEO and Founder of Stream Technologies, a company that has been working in IoT since 2000, originally as an MVNO [mobile network virtual operator]globally, but now as the provider of a key platform to manage connectivity across multiple cellular networks plus satellite and low power wide area networks (LPWANs). He said:
“We need to think about what IoT needs for connectivity management – not just different network types, but APIs for IBM’s Watson and other platforms. We’ve got lots of them for device management, data and connectivity, and much more, but we’re talking about high performance irrespective of what the platform is doing, which means scalability, resilience, security, maybe cloud or in-premises.
“These are the fundamental building blocks that we had to be aware of and must have in platforms to be future-proof. A lot of solution providers out there need to think about that – if [solutions]have a short shelf life, they are too expensive.”
Find your evolutionary path
Van den Dam said, “With digital, some sectors are only just starting; others are more advanced, and telcos are in the middle.” He said telcos need to evolve into digital service providers and enablers to thrive in future – as shown in the graphic below, which IBM originated.
“We need to progress, to work with APIs and microservices, and have the right people on board, but those skills are too scarce to succeed in moving on the horizontal axis,” Van den Dam added. “On the vertical axis, telcos think they can do everything themselves, but they need ecosystems and partners to react to the needs of consumers.”
[Editor’s note: You can also watch this video to see TM Forum’s CEO explain the steps needed to make that digital transformation.]
How to win in a digital ecosystem
Hase reflected that to create new forms of partnerships – beyond the normal customer and supplier ones – telcos need to change their thinking totally, and look at revenue-sharing models.
“We have space in our offices where our partners can sit because it helps a lot to do things together. There are big changes in principle to developing the market together, and revenue sharing means everyone has to generate revenue,” he said. “This is deep learning for us.”
Chadwick said an ecosystem “has to contain different technologies to reach between different companies” and gave the example of eSIM. He pointed out, “There has been a big push back from operators [against eSIM]for years, but now it is happening for example, with Apple Watch. We have subscription management [on our platform], so manage different kinds of subscriptions from all operators on our platform by making it easy to integrate them.”
eSIM is coming, like it or not
Chadwick continued, “The eSIM makers who have the key and enable the download of profiles, companies like Gemalto, have two separate technologies to make eSIM work and we’ve partnered with [some of them]to enable that, But, you have to partner with mobile operators too and make their keys available, and manage subscriptions and maybe wholesale tariffs as well.
“There are a lot of partnerships involved, and testing, before anything can go out into the marketplace. A lot of those partnerships have to come from mobile operators [and larger entities]not from the small companies – market demand is driving ecosystems and pushing companies to come together.”