BENCHMARK

Authors:
Mark Newman, Chief Analyst
Dean Ramsay, Principal Analyst
Editor:
Dawn Bushaus, Managing Editor

October 2021
inform.tmforum.org

Sponsored by
contents

04 07 12 19
the big picture section 1: section 2: section 3:
the state of telecoms why CSPs believe B2B products & services for
revenue worldwide is the answer to growth the enterprise market

26 31 37 41
section 4: section 5: section 6: section 7:
which enterprise security services are an IoT services could cloud services
services have the emerging sweet spot continue to post become big business
most potential? for telcos strong growth for CSPs?

46 51 57 62
section 8: section 9: section 10:
section 11:
MPNs, data-as-a-service changing enterprises’ re-examining consumer
is connectivity dying
& verticals also promise perception of telcos strategies
– or isn’t it?
revenue growth

65 additional features
& resources

section 12:
how to realize growth
opportunities

2 inform.tmforum.org
additional features
& resources
10 | The case for a national ecosystem service provider

16 | Monetizing 5G through enterprise and the evolution of charging

22 | Huawei “Five Star Best Billing Benchmark” Model: Building five-

dimensional monetization advantages to capitalize on the present
and win in the future

44 | How VoltDB Active(N) changes the game for cross data center
replication

49 | How Intelligent Automation is vital to the rollout of 5G

53 | Operators need full-stack transformation software to accelerate

revenue growth from innovative digital services

72 | Network Lifecycle Automation: Infovista’s solution for achieving

increased automation with end-to-end solutions, from CAPEX
investment to service monetization.

75 | TM Forum Open Digital Framework

76 | TM Forum research reports

77 | Meet the Research & Media team

3 inform.tmforum.org
 BENCHMARK

the big picture

Communications service providers (CSPs) are pinning their hopes for future revenue growth not on their existing
connectivity businesses, but on new B2B services that they hope to develop on top of connectivity by leveraging
5G, IoT, edge computing and AI. To understand the revenue potential of these new ICT services, it is important to
understand the current financial state of CSPs’ businesses.

O
ur research for this report business and to illustrate how an extensive survey of 205
was two-pronged. First, this data compares with growth people working inside 82 CSPs
we needed to create an in the traditional connectivity worldwide. Respondents included
up-to-date set of financial data business (see page 5). But we also C-level executives, architects
for CSPs globally in order to wanted to understand how telco and engineers in IT and network
compare the size and growth leaders feel about their prospects departments, leaders of enterprise
rates for their new lines of for the future, so we conducted lines of business and consultants.

Who are the Telco growth survey respondents?

205 CSP respondents from 82 companies

8% 34%
NORTH AMERICA EUROPE

6% 39%
LATIN AMERICA
ASIA & ASIA-PACIFIC

13%
MIDDLE EAST & AFRICA

TM Forum, 2021

4 inform.tmforum.org
the big picture

Methodology for creating a financial snapshot

For our research we collected business we have shown the B2B revenue has been hit by
financial KPIs from 31 of the proportion of total revenue they business failures and digital
world’s largest CSPs, comparing make up. There is a risk that transformation projects being
their results for the period from such calculations could give put on hold. Nevertheless, three
2018 to 2020. The combined the impression that revenue new lines of business we are
revenue of this group represents from many new services is focusing on in this report –
about 69% of the service revenue inconsequential. This is not security, IoT and cloud – showed
in the telecoms industry, and our the case. year-on-year growth of 20% to
analysis throughout the report is 30% over the period.
The sheer size of the core
based on an extrapolated data
telecoms business makes revenue Our forecasts in the report
model based on the sample
from new services look small for overall B2B services plus
group’s financial results.
by comparison. For example, security, IoT, cloud, TV and mobile
Creating a model was not an easy Vodafone is earning $940 million payment services are based on a
task because telcos report revenue annually from its IoT business; combination of moving-average
differently. For example, only 17 Orange generates $880 million model forecasting from historic
of the 31 CSPs we analyzed split from security services; and data, analysis of growth actuals
their B2B and B2C revenue, and China Telecom makes $1.7 billion from comparable segments (in
only a handful report revenue for from cloud services. But these telecoms and IT sectors), and
new lines of business. As we were businesses account for just 1.8%, adjustments for current market
consolidating the results into US 1.6% and 2.8% of total revenues, pressure resulting from the
dollars (USD), we eliminated the respectively. pandemic.
influence of currency exchange It is important to note that
By tracking revenue for three
rate fluctuations against USD by our forecasts are based on
years, it would normally be
using a common historic exchange an extrapolation of existing
possible to get a good feel
rate across all three years, based trends. However, the impact of
for how quickly the new lines
on the rate on January 1, 2019. the Covid-19 pandemic on the
of business are growing. But
To build a picture of the the Covid-19 pandemic has 2020 revenue figures made this
importance of these new significantly impacted telcos’ difficult. Our solution was to use
services to the overall telecoms revenue for the last two years. an extrapolation of growth before
the pandemic, compensating
for the impact and based on
Overall revenue for telecoms worldwide 2018-2020 our estimates for speed of
economic recovery for each of the
1,650
segments.
Revenue (USD billions)

1,625 We estimated some of the

missing data for various CSPs
1,600 for the period 2018 to 2020
0.8%
by using data collected from
1,575 growth financial reports to create a
1.6% median number for percentage of
1,550 growth
total service revenue for a given
1,525 segment. Then we estimated a
figure for the missing CSPs based
1,500 on that percentage, combined
2018 2019 2020 with an assessment of where we
TM Forum, 2021
think the others are relative to the
market leaders.

5 inform.tmforum.org
The big picture

business has flattened in many depreciation and amortization)

countries because of competition margin of more than 30% in their
from video platforms like Netflix. core network businesses. Even
though financial data for their
When it comes to growth in B2C managed services and professional
CSPs’ challenge is to services, there is a divide between services businesses is difficult to
find a new operating operators in emerging markets obtain, we believe the EBIDTA
model while continuing (where multi-play and mobile margin for such services is closer
money are growing) and operators
to optimize the to 10%, even among the most
in developed markets. CSPs in successful operators. This is much
legacy connectivity developed markets are hopeful that lower than the 20% EBIDTA
business. 5G will deliver new revenue, either margin that most successful global
from higher-priced mobile services professional services firms generate.
or 5G fixed wireless access.
Can B2B deliver? The disparity in the relative
Getting there profitability of network
Our research finds that while total connectivity and new ICT services
telecoms revenue is flat, B2B is CSPs are still trying to identify raises important questions
outperforming B2C. However, the operating model that will give about where operators should
there is a massive disparity in B2B them the best chance of delivering focus as they deploy 5G and
maturity among CSPs globally, sustainable revenue growth. Their associated capabilities such as
depending on the regions where challenge is how to achieve this edge computing, mobile private
they operate and when they while continuing to optimize the networks and IoT. CSPs are
entered the B2B market. Incumbent legacy connectivity business. more committed than ever to
telcos in mature, developed their network and connectivity
markets, for example, already Acquisitions are playing a big
part in operators’ growth plans, businesses, but it is unclear whether
generate more than 20% of their they can grow connectivity revenue
revenue from B2B services and in especially for services in which
they do not have a lot of expertise, through higher prices and/or more
some cases as much as 40%. connections. If they can’t, they
such as security. Cloud, IoT and
security services require specialist stand a better chance of capturing
However, most of incumbent
knowledge and skills, although a share of total enterprise spending
CSPs’ revenue gains are simply
this has been less of an issue in on many new ICT services by
compensating for the decline in
IoT since 80% to 90% of revenues delivering connectivity that better
revenue from their core network and
come from connectivity. Our meets the requirements of different
connectivity businesses. In some
research has identified that the enterprise applications.
cases, core connectivity revenue is
declining by more than 5% per year. most successful approach to Read this report to understand:
integrating acquisitions is to leave
Challengers to the incumbents The current state of CSPs’
companies operating as separate
have a much better opportunity businesses and revenue
businesses and resell their products
to show growth in B2B revenue The impact of Covid-19 on
through existing B2B divisions.
because they have not been selling revenue
enterprise services for very long. Why security, IoT and cloud
What about connectivity? services represent the best
In this report, we focus on revenue chance for growth in B2B
Consumer growth slows
rather than profitability because Why MPNs and data-as-a-
Our analysis of telcos’ consumer very few CSPs report the costs service also hold promise
strategies points to a growing associated with delivering new Whether enterprises want to
focus on multi-play services services. But it is possible to draw do business with telcos
across the world with operators some conclusions about the
expanding to offer the services How CSPs’ consumer
profitability of operators’ core
they currently do not – for businesses are changing, with
connectivity businesses versus
example mobile operators particular focus on TV and
new ICT services that rely on
expanding into fixed, broadband mobile payment services
professional and managed services.
and TV services. But overall What the future holds for
revenue for these services is not Telcos generate an EBITDA connectivity services
growing. Indeed, the pay-TV (earnings before interest, taxes, Steps telcos can take to realize
revenue growth opportunities

6 inform.tmforum.org
 BENCHMARK

section 1:

the state of telecoms

revenue worldwide
Worldwide telecoms revenues
are still extremely flat, showing Total B2B revenue for telecoms worldwide 2018-2020
very little growth for several
years. A bright spot on the 400
horizon, however, is the market
Revenue (USD billions)

for B2B services which is giving 380

communications service providers
(CSPs) reason to hope that they 360
have discovered a path to revenue
growth for the next decade. 3.5%
340 3.5% decline
growth

B
etween 2019 and 2020, 320
revenue from consumer
services registered a
decline of 3.6% due to the impact 300
2018 2019 2020
of the Covid-19 pandemic, and
revenue from enterprise services TM Forum, 2021

also took a hit, falling by 3.5%

year on year. However, prior to
2020 revenue from B2B services
Total B2C revenue for telecoms worldwide 2018-2020
was growing steadily at around
3.5% annually. This is leading 1,300
most telcos to shift their focus to
Revenue (USD billions)

enterprise lines of business.

1,250
Existing B2B services – voice and
data communications packages
for enterprises and small and 1,200
3.6%
medium enterprises (SMEs) – are 0.9% decline
growth
not likely to generate vast growth
in the coming years, so telcos are 1,150
pursuing new service models for
hot areas such as security, IoT
1,100
and cloud – despite the vagaries
2018 2019 2020
around what the next killer
TM Forum, 2021
application might be.

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section 1: the state of telecoms revenue worldwide

Impact of Covid-19 Slicing the telco revenue pie

It is essential to address the effect
that the pandemic has had on
businesses worldwide and how
it has affected CSPs’ financial
performance. Historically, telcos
have not been negatively impacted
by macroeconomic cycles. For IoT 1.1%
example, they have been resilient Cloud 1%
in times of recession due to their Security .6%
strong capital positions and because
their utility-like core services are
necessary.

However, the shift to working IoT 1.1%

Cloud 1%
from home for a billion people Security .6%
worldwide hit usage of telcos’
core B2B services hard. Many
offices were closed indefinitely TM Forum, 2021

during the first quarter of

Enterprise revenue from fixed connections accelerated, with
2020, with workers switching
data services was affected but hard-hit consumers looking to cut
to consumer fixed broadband
not catastrophically as many their monthly bills. There was also
connections.
business customers are on long- a huge drop in roaming revenue
term contracts which ensured that throughout 2020 caused by
CSPs still received some income. lockdowns and travel bans.
Consequently, the huge drop in
usage of B2B fixed data services Where’s the growth?
was not entirely mirrored in the
financial results. Many of the CSPs analyzed in this
report were seeing B2B growth
The new Consumer fixed and wireless before the pandemic, and they

business broadband became a connectivity

lifeline for many millions of office
have been focusing on digital
transformation of B2B operations
models we workers – for work, shopping, and service development. We
have analyzed entertainment, and video calling
their family and friends. Many CSPs
believe that much of this growth
is coming from established B2B
make up just accepted enterprise customers services as CSPs widen their
1% or less working over their consumer portfolios aimed at large and
small enterprises to drive growth.
of the total connections and did not try to
increase prices, calculating that it
revenue of a would be a temporary shift. Growth is coming from
connectivity-based solutions
typical CSP. Revenue from B2B and B2C such as software-defined wide
fixed voice services dropped area networks which act as an
as some companies closed overlay (in a sense, a value-added
permanently and the ongoing service). New ICT services such
residential trend to cut landline as security, IoT and cloud are

8 inform.tmforum.org
section 1: the state of telecoms revenue worldwide

Revenue growth for new ICT services in context of entire B2B market
450
New services
400
12.6% of total
New services
350 B2B revenue
5.3% of total
B2B revenue (CAGR 17.9%)
300
Revenue USD billions

250
200

150 CAGR -0.08%

100

50
0
2018 2019 2020 2021 2022 2023 2024

Established B2B IoT Cloud Security

TM Forum, 2021

also contributing to overall B2B The Pay TV segment is still operators and their suppliers face is
growth, but it is important to look relatively large compared with continuing to drive transformation
at their size compared to existing the other non-communications of the traditional telco through
core business revenues. categories at around 4% of total investment in technology and
revenue. We predict that these software.
The services we have analyzed revenues will drop off slightly
make up just 1% or less of the total over the coming five years (see In 2018, new ICT service
revenue of a typical CSP, even Section 10). categories represented just 5.3%
among progressive operators of total B2B revenue, despite IoT
that have invested heavily in existing as a concept for over a
diversification strategies. We’ll
What’s ahead? decade. By 2024 we predict this
look at each segment in more Most CSPs are worried about flat share will rise to 12.6% due to
detail later in the report. and declining revenues, and in the traditional B2B connectivity
a growth-obsessed industry the market being very flat and most
Pay TV stalls search for the next big source of growth coming from these new
additional revenue has become lines of business.
On the consumer side, the a sole focus for many. However,
pandemic hit CSPs’ Pay TV the capital position of CSPs is During this period standalone
revenue as some consumers strong. Their core business is not 5G will also be deployed, further
turned to over-the-top (OTT) in radical decline, and the services stimulating revenue for B2B and
players like Netflix and Disney they sell are essential to society. B2B2C use cases. We will study
Plus and others cancelled their profitability for these service
subscriptions to save money. Consequently, a catastrophic categories over the same period
However, some operators opted to decline in revenue is not likely to in the next TM Forum Benchmark
partner with services like Netflix, happen any time soon. Still, the report, scheduled for early 2022.
integrating them into cable and search is on for the new hot ticket,
satellite platforms. and many nascent service models In the next section we look at why
are showing promise. The challenge CSPs believe B2B services are the
answer to growth.

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SPONSORED FEATURE

BENCHMARK

The case for a national

ecosystem service provider
Thinking beyond specific verticals, Communication Service Providers (CSPs) are uniquely positioned to
facilitate digital ecosystems on a national scale, allowing them to provide new services to boost top line
revenue growth. EPAM can serve as your catalyst for this transformation.

Moving beyond connectivity To work across organizational, required to enable the people,
(from CSP to ESP) functional, and country borders. process, and technology change
With the baby boomers retired, that create business models of
Capitalising on the core offering
the next population boomers, the future and meet customer
of the CSP - the fastest and most
currently starting their university experience aspirations for
effective communications system
studies, will likely drive this competitive advantage.
on the planet - CSPs have the
wholistic approach. Having grown Overall, telecoms operator revenues
opportunity to move up the value
up with social media and other remained flat over the period 2018
chain and operate at the cloud
collaboration tools in school, they to 2020. The growth is anticipated
native service layer, to move
understand the power of the to be in the B2B domain which
from an important commodity
seamless connected network and requires a shift from adapting
into a highly-differentiated cloud
the harnessing of expertise for a consumer led investments to
services provider with an end-to-
difficult (societal) problem. We at fit business customer needs
end offering.
EPAM see that tapping into these to driving strategy based on
The Ecosystem Solution Providers value networks and orchestrating enterprise. The 5G investment is a
(EPSs) will become a broker of all the required governance to good example, where Consumer
connectivity led data and services, keep this ecosystem healthy, is a units have paid for the network but
providing incremental value unique opportunity for CSPs to only new B2B revenues can realise
in aggregation, normalisation pivot and create top line growth. the full ROI. 5G is seen as a key
and licenced access to a secure
enabler, but “there are also other
marketplace that standardises
ROI on 5G innovative technologies that can be
procurement, onboarding, sales
Looking at the survey results from leveraged” in the wider ecosystem
and service for partners and
this year, it is clear that the CSP to complete the needed CSP
customers.
sector remains stuck in a decade offering, according to the survey
old dilemma: struggling to unlock results. Great, but which ones? And
The need for ecosystem is this the right play?
the potential of new products and
solution providers
services and disruptive business
The pandemic has demonstrated models, as top line revenues FInding the right growth
that to solve the large societal decline and traditional portfolios Industry analysts are predicting
issues, from climate change, to diminish. Cost cutting exercises growth to come from security,
education, transportation, and continue, to keep EBITDA margins cloud, data and IoT services. The
security, we need to learn to acceptable, without the realisation industry predominantly focuses
collaborate better as a whole. of the full-scale transformation their use cases around healthcare,

10 inform.tmforum.org
SPONSORED FEATURE

defence, education and logistics. ESP following this model can ecosystem. The ESP can make
But, when looking at their financial drive growth at rapid scale while this data available in a safe and
reports, it becomes clear that less supporting larger societal needs. controlled manner, offering
than half a percent is currently subscriptions to partners such
being attributed to IoT revenues. Making it work as emergency responders,
Instead, the CSPs have seen the other vehicles on the road, and
hyperscalers (Microsoft, Google, The barrier to entry, however, insurance companies when there
Amazon, etc) create tremendous continues to be the business is an accident. For ecosystem
growth with OTT services on case for (as yet) unrecognised initiatives like this one, where a
their networks. The benefits from revenues, which impacts the safer and more efficient society is
collaborating with hyperscalers pace of change away from legacy the goal, the business case is not
and the CSPs role in providing systems and ways of working. This just for the CSP. ESP’s focus is the
connectivity to, migrating to, and modernised platform, combined maximization of value for all the
securing personal or business with the required governance to ecosystem participants, and to
data within the cloud, is nascent. share data among the ecosystem govern this objective on behalf of
partners, is where the ESP the group.
We’ve seen multiple examples opportunities lie. In the ingestion
of ecosystem growth in the last of data, the harmonization of it,
decade, including Apple’s app and the brokerage on behalf of The future. Made real
store, Amazon’s eCommerce the owners to partners for better EPAM has expertise in solving
platform, and most social media and faster cloud native services. these problems within the
platforms, where ecosystem telco domain and the ability to
partners are adhering to An example could be the
harnessing of the data generated draw on best practice from our
a standard governance to clients in parallel industries. We
publish, sell and grow, in order on our highways. From the
cameras on the vehicles, to the have a tailored offering for the
to become the fastest growth transformation to become an
companies across the globe. An traffic management systems
and other IoT sensors in this Ecosystem Service Provider:

EMBRACING AGILE
BECOMING AN HARNESSING THE FOCUSSING ON
OPERATIONS FOR
ECOSYSTEM SERVICE POWER OF DATA IN AN THE VALUE OF THE
ECOSYSTEM PARTNER
PROVIDER ECOSYSTEM ECOSYSTEM PARTNERS
GROWTH

• B2B2X model design • Data ingestion, • BSS / OSS integration • Partner management
• Made to measure anonymisation, • Cloud native • Subscriber and
network solutions privacy & permission applications business modelling
management
• Smart City solutions • Payment solutions • Ecosystem business
• Data monetization case development
• Networking solutions solutions • Backoffice
• Cloud based device optimization • Ecosystem
• Predictive analytics governance
management modelling, ML and AI • Digital factory and
• Low latency DevSecOps delivery • Identifying and
• Recommendation models understanding
application engines and
development • Agile coaching user needs in the
personalization ecosystem
• Architecture – • Organizational
Cloud, API, MACH & transformation and • Driving ecosystem
Microservices change management growth

• Security by design

EPAM provides solutions for 6/10 of the world’s largest Telecom companies.
For further information contact [email protected] or visit epam.com.

11 inform.tmforum.org
 BENCHMARK

section 2:

why CSPs believe B2B

is the answer to growth
Communications service providers (CSPs) and their suppliers clearly believe that the enterprise market presents a
better opportunity for revenue growth than the consumer sector. Indeed, in the survey conducted for this report five
times as many respondents identified B2B as a more likely source of future revenue, although two thirds said they see
opportunities across both segments.

S
imilarly, when we asked CSPs' projections for revenue growth in the next 5 years
respondents to estimate
4.4% 3.1%
compound annual 1.3%
2.5%
growth rate (CAGR) for their
organizations over the next
five years in each market, they 21.9%
favored B2B. The most optimistic 28.6%
answers show a clear vote
for higher CAGR in B2B than
B2C, with more than half of
respondents saying they expect 20.0%
CAGR of more than 6% in their
B2B businesses over the next
five years while about 40% of 25.5%
respondents expect more than
6% growth in B2C. 23.1%

Reasons for optimism

It is important to note that 19.2%
globally many CSPs are bullish
15.0%
about B2B because their
enterprise businesses are
8.0%
relatively immature. They are
pinning their hopes on growth 15.6%
resulting from the deployment of 11.8%
technologies such as 5G and IoT
(see page 13). B2C B2B
-3% to -10% -3% to 0% 0% to 3% 3% to 6%
6% to 10% 10% to 20% More than 20%

TM Forum, 2021

12 inform.tmforum.org
section 2: why CSPs believe B2B is the answer to growth

We believe these segments may

demonstrate strong revenue Will 5G play a starring role?
potential but only when starting
from a low revenue base. In other While early 5G deployments The CSPs we surveyed consider
words, B2B may be a fast-growing have focused on deploying radio 5G to be integral to their B2B
part of CSPs’ businesses, but it is access networks to increase expansion, with more than 85%
small in absolute terms. capacity and speed for mobile of respondents saying it is either
broadband customers, CSPs will crucial or important to enterprise
Several trends are responsible for roll out standalone 5G networks growth. However, nearly six out
CSPs’ optimism: that use cloud computing and of ten CSPs said 5G is just one
MEC during the next two years. of several technologies that
Digital transformation – most

This will allow them to target will drive growth. Indeed, some
companies are transforming their
enterprises with services such operators see their investments
businesses digitally, and CSPs
as network slicing and edge in edge computing, cloud native
envision helping them embrace
computing. IT systems and networks, and IoT
Industry 4.0, which describes the
connectivity as sitting under an
confluence of new technologies
umbrella of 5G services.
such as AI, quantum computing,
smart manufacturing, IoT and 5G.
Importance of 5G to CSPs' revenue growth
The inclusion of 5G in the list has
created high expectations for the
role and value of communications 13% 5G is crucial – our growth
technologies. 30% strategy is pinned to it

5G – CSPs are building their 5G

 5G is important, but we
return-on-investment narratives will also leverage other
technologies and capabilities
around B2B and B2B2X use
cases, which is leading to 5G is not important to
“verticalization” of business growth – it is the next "G"
opportunities. Operators envision but does not have inherent
leveraging multi-access edge characteristics that will
enable new revenue streams
computing (MEC) so that they 57%
can play an important role at the
TM Forum, 2021
edge (see panel).

IoT – expectations for IoT growth


have cooled recently, but most
operators still believe that at some
time in the future – perhaps five
to ten years from now – their
networks will connect as many
things as people or buildings.

New lines of business – the


promising financial performance
of new lines of business such as
security, IoT, cloud and other new
ICT services is encouraging CSPs
to explore other ways to serve
enterprises.

13 inform.tmforum.org
section 2: why CSPs believe B2B is the answer to growth

defenders
incumbent telcos with
mature B2B lines of business

players
in the B2B game

challengers specialists
second operators providers of ICT services
that have focused mostly in niche markets or verticals
on consumer mobile and such as healthcare or
now have their sights set manufacturing
on expanding the services
they offer to enterprises.

TM Forum, 2021

prospectors
third and fourth operators
that serve consumers and will
need to experiment with business
models in order to
reach enterprises

The B2B telecoms market is Defenders services, and on the enterprise side
complex. Services that telcos offer into managed services that allow
In most countries, particularly
to enterprises vary widely, as do companies to outsource non-
developed markets in North
the types of companies they serve, core technology functions. So far,
America, Europe and parts
from small office/home office however, the CSPs’ mobile services
of Asia, incumbent CSPs
environments to multinational have not been widely integrated into
have relatively mature B2B
corporations (see page 20). In enterprises’ corporate networks.
lines of business, built before
addition, the size and maturity
governments introduced Incumbent operators are
of operators’ enterprise lines of
competition into fixed and mobile defending their legacy and
business vary widely. As part of
markets in the 1980s and 1990s. must create new products and
our research, we looked at CSPs’
They have been providing fixed- services to compensate for the
current B2B activities and market
line and broadband services to decline in revenue from voice
prospects and categorized the
businesses and consumers for communications and connectivity
operators as one of four types
more than 50 years. more broadly. Their challenge is to
of companies as shown in the
infographic above. grow new revenue more quickly
On the consumer side they have
than old revenue declines.
expanded into mobile and TV

14 inform.tmforum.org
section 2: why CSPs believe B2B is the answer to growth

Operators in this category include: Specialists hardware and software products.

Deutsche Telekom, Orange and Their skills tend to be more around
The B2B market is more
Telefónica in Europe; AT&T and the integration of products and
fragmented than the consumer
Verizon in the US; and SingTel and capabilities and delivering the
sector, and this has given rise to
Telstra in the Asia-Pacific region. business capabilities required by
a huge number of specialized ICT
enterprises. For example, European
service providers. Specialists may
Challengers telecoms service provider Gamma
have unique selling propositions
provides unified communications
Since the 1990s, “second” or based on:
services in Germany, the
“alternative” carriers have been Netherlands, Spain and the UK.
Network capabilities such as

challenging incumbents in telecoms
fiber deployments
markets. They first emerged in the
local exchange, followed by startup Prospectors
Market size (see page 20

mobile operators. for a description of types of The later a mobile operator entered
business customers) a market, the less likely it is to have
Many of the mobile operators dedicated resources for diversifying
have since expanded their service Verticals like healthcare,
 from its core consumer business.
portfolios to offer fixed line, manufacturing or automotive Most third, fourth and fifth mobile
broadband and TV services. And operators have struggled to achieve
although their focus is primarily Geography which could
 profitability, although some third
the consumer market, many have include countries, cities or even mobile operators have managed
expanded into the enterprise buildings to scale through mergers and
sector through a combination of acquisitions.
fiber deployment and acquisitions. Product lines such as unified

However, in most cases B2B communications, private We call these companies
remains a relatively small part of networks, call center services prospectors because they
their overall business. or IoT necessarily must take a different
approach to addressing B2B
Challengers are more likely to be Specialists that focus on verticals
opportunities, either as wholesale
mobile-centric in their strategies for or geographies are particularly
operators, “asset-light” operators
developing new lines of business relevant in 5G-enabled growth
(such as MVNOs or B2B operators
because mobility is their legacy. markets. Every vertical sector has
that buy dark fiber or wholesale
To target the enterprise market, its own providers of ICT services,
services) or highly specialized,
most must develop new skills and and CSPs will have to decide
niche operators.
competencies that are not always whether to partner or compete.
adjacent to their core business. Perhaps the best example of a
Similarly, companies providing
prospector is Hutchison Telecom
Companies in this category include services in specific regions
which entered the European
China Mobile and Vodafone – two are particularly relevant to the
telecoms market in the 3G era and
of the biggest IoT service providers emerging mobile private network
remains a challenger. The company
in the telecoms sector – India’s (MPN) market. For example,
is now experimenting in sectors
Reliance Jio, and T-Mobile in the “neutral host providers” –
such as MPNs as a greenfield player.
US. It is also worth noting that companies that deliver in-building
large operator groups can be Wi-Fi and cellular coverage – are In the next section we’ll look more
defenders in their home markets building MPNs for enterprises that closely at the types of products and
but challengers in other markets. need indoor coverage. services CSPs are developing to
target the enterprise market.
Specialists that focus on a product
category are likely to be MVNOs,
resellers or distributors of networks,

15 inform.tmforum.org
SPONSORED FEATURE

BENCHMARK

Monetizing 5G Through
Enterprise and the Evolution
of Charging
For communications service providers (CSPs), 5G is driving a shift from a world of closed data to open data.
For hyperscalers like Amazon and Google in the communications market, data has become the high-value asset
to be fought over. The race to capture, understand and monetize this data has begun.

To be prepared and ultimately New business models and OSS data and relevant data from
successful in the 5G world, CSPs charging requirements hyperscalers, MEC, enterprises
need to consider the optimal (all major industries) and global
To capture and rapidly process
ways to maximise the opportunity leading billing partners such
all the data needed to support an
that service usage data will bring, as Salesforce and SAP. This is
extensive range of current and
such as: essential for addressing revenue
future business models, CSPs
Comprehensively capturing opportunities in the converging
will need a comprehensive 5G
and rapidly processing all the cloud/IT/network market and
charging function (CHF/CGF).
data needed, to support an for empowering enterprises to
It will be used to enable all the
extensive range of current and innovate on top of the 5G data
relevant 5G business models for
future business models. within their billing domain.
B2C, B2B, B2B2X, roaming and
Going beyond the known the billing marketplace, such as
and traditional network data connectivity-as-a-service (CaaS), Cloud-native agility
sources to capture every value-added CaaS (slicing), Scalability and agility are key
possible drop of information to network exposure and platform- when working with 5G services.
support usage-based revenue as-a-service (PaaS), and new Specifically, agility will accelerate
management. charging models that incorporate time-to-innovate and will help to
SLA or KPI based business reduce the risk associated with
Embracing cloud-native
outcome charging. long IT projects of the past BSS
software to take advantage of
era. Therefore, it’s important that
the developer-friendly, flexible,
and ready-to-use infrastructure Capturing and processing operators embrace cloud-native
to optimise time-to-market real-time data software and take advantage of
the developer-friendly and flexible
agility and resilience. Fully holistic support of 5G
infrastructure to optimize time-
Minimizing risk throughout services means CSPs need
to-market agility and resiliency.
billing system modernisation to go beyond the known and
In turn, it’s also important for
by carefully considering the traditional network data sources
vendors to align with the CSP
opportunities for consolidation to capture every possible drop of
journey to cloud, so that they can
and customer migration. information to support complex
take advantage of the operational
revenue management. It’s an
Introducing organic flexibility DevOps benefits such as CI/CD
approach that goes beyond
that can adapt to the charging and for solutions to be suitable for
traditional mediation to not only
models that will come with both private and public cloud.
work with telco network billing
network slicing. data, but also encompassing

16 inform.tmforum.org
SPONSORED FEATURE

System consolidation and enterprises with value-added addresses evolved 5G charging

customer migration connectivity incorporating requirements of CSPs in seven key
network and IT infrastructure, differentiating ways.
Historically, introducing a
applications and QoS. This Firstly, by integration to any new
new network technology has
organic flexibility will need to network function, allowing its
meant adding another silo of
be accompanied by business capabilities to be offered and
OSS and BSS, subsequently
model creativity that dynamically incorporated into new business
introducing inefficiencies, and
supports any charging model for models. This involves the collection
increasing costs. Therefore, a key
both private and public networks. and use of specific network metrics
consideration for 5G must be
how to operate and bill for new to allow a CSP to create new ways
consumer and enterprise services, Evolution and the new of charging and billing, either for
while maintaining support for standard for usage-based new revenue opportunities or for
those customers on previous charging competitive differentiation.
generation services. Approaching The DigitalRoute Usage Data Secondly, through efficient routing
5G is different at each operator, Platform comprehensively of charging traffic the platform
but their focus will always be to
maintain their core business and
revenue stream, while incubating
new 5G revenues and securing
the necessary agility in the new
5G environment. In some cases,
we have seen CSPs building a new
line of business and associated
BSS architecture to address new
enterprise 5G opportunities and to
isolate that revenue stream from
the existing services and business.

Value-added connectivity
business models
Network slicing will create a
great opportunity for CSPs
to differentiate themselves to

17 inform.tmforum.org
SPONSORED FEATURE

generations, and to enable

multiple downstream systems
with the same data set while
embracing data silos is now more
relevant than ever.

Limitless opportunities
waiting to be captured
5G opens limitless opportunities
in the form of new services,
new marketplaces, partnerships,
ecosystems, and new industry-
specific solutions, all generating
a plethora of usage data and
information. CSPs will ultimately
monetize their 5G infrastructure
through network slicing and
enables legacy OCS systems Another important requirement monetize their operations with
to support 5G services, while addressed by the platform is numerous as-a-service offerings
facilitating a controlled migration convergence, supporting the new to their enterprise customers.
to a 5G native CCS charging stack. 5G protocols and bridging older Hyperscalers will be looking to
Thirdly, as the platform is acting generations of networks. This compliment the market offerings
as the billing mediation module, permits CSPs to migrate their with edge services, taking
it’s high-performing CGF can cope customers gradually without the advantage of their cloud prowess.
with the expected heightened risk of revenue cannibalization Time will tell which opportunities
demand and complex upstream from established subscribers on will take off first, however, we
and downstream data that 3G or 4G. already know the implications of
will come from new innovative As hyperscalers move into 5G. Service offerings will become
enterprise services. the telco domain with MEC, more complex, and increasingly
By exposing relevant usage data the platform will facilitate the sold ‘as-a-service’. The delivery
and metrics, from future network monetization of those services. of services will be one hundred
slices and advanced connectivity Not only can DigitalRoute’s percent on cloud-based software,
services, the platform can enable Usage Data Platform be hosted and monetization opportunities
CSPs to monetize new B2B and as a cloud-native platform on for both CSPs and the enterprise,
B2B2X revenue streams. any hyperscale cloud, but the will be highly dependent on usage
platform has native connectors to data and its timely collection,
Being cloud ready and cloud- those environments. It’s critical to verification, and binding to
native, the usage data platform capture data from the network, customers.
allows CSPs to offer new services applications, the MEC service and
with agility and automation. It the MEC host in this case.
aligns with CSP IT stack cloud
evolution strategies and timelines, In summary, with 5G it’s now
allowing CSPs to benefit from more relevant than ever, given
the exposure of APIs that will the variety of charging interfaces,
enable an external orchestrator to that if CSPs don’t have a
control resources, and ultimately convergence strategy they will be
faster time to market and time to forced into siloed point to point
revenue for new services. integrations. The role of a vendor-
agnostic layer to bridge network

18 inform.tmforum.org
 BENCHMARK

section 3:

products & services for

the enterprise market
Communications service providers (CSPs) that have mature B2B lines of business have developed extensive product
portfolios to serve different types of companies. Offers range from basic voice connectivity to more complex managed
and professional services. This section explores the products with a focus on how companies of various size and type
might use them.

enterprise services for sale

hardware managed &

network & software professional services

approach approach approach

CSP sells connectivity & CSP resells: CSP sells:
communications services • hardware (routers/devices) • managed networks
• software-as-a-service • managed cloud services
• professional integration
services/IT services

competitive threats competitive threats competitive threats

other telcos and asset-light partners’ direct-to-customer systems integrators &
CSPs such as MVNOs businesses consulting companies

primary target(s) primary target(s) primary target(s)

all businesses all businesses large & multinational companies,
government

outlook outlook outlook

in mature markets, telco’s B2B many telcos are seeking to CSPs’ legacy managed network &
revenues are declining by 0%-5% per increase SaaS sales through services businesses are under
year; fixed broadband continues to portals and marketplaces; pressure due to declines in MPLS
grow, especially in developing equipment sales are under and leased lines; strong growth in
markets and for challenger operators pressure due to migration to cloud security, cloud & IoT

TM Forum, 2021

19 inform.tmforum.org
section 3: products & services for the enterprise market

As shown in the graphic on page phones) or software services. Struggling to serve SMEs
19, enterprise services can be For example, many operators
Most CSPs segment their B2B
broken down into three main resell Microsoft 365 to small
customers based on size of
categories: businesses as part of a
company. A classic market
package. Other categories of
Network – the CSP delivers segmentation looks like the
products that are resold by
connectivity and voice and/ graphic below.
telecoms operators include
or data communications unified communications, Self-employed and small office/
across public fixed and storage and security services. home office (SoHo) customers
mobile networks. Many
often buy products aimed at
enterprises are migrating to Managed & professional

the consumer market, although
all-IP networks and adopting services – some CSPs
operators have tried with mixed
unified communications that separate these services, but
success to offer services such as IT
bring together networks that they use the same business
support, backup, and internet/web
were previously physically model. In the case of managed
tools and capabilities in order to
separate. Growing adoption services, the telco manages
move them to higher-priced plans.
of software-defined wide area a large private network on
networks (SD-WANs) and behalf of an enterprise. The The small and medium enterprise
the migration of traffic from growth of cloud computing (SME) sector often gets caught
private networks into public and enterprises’ adoption between the SoHo market and
clouds are putting immense of hybrid-cloud and multi- larger enterprises. CSPs often
pressure on operators’ cloud networks has breathed contend that SMEs represent a
connectivity revenues. new life into this business for good growth opportunity but
CSPs. Professional services admit that they struggle to serve
Resale of software &
 often go a step further, them efficiently through physical
hardware – the CSP resells providing systems integration and digital channels. Many SMEs
products from third parties for managed networks, are keen to increase their digital
(such as phone systems, but increasingly CSPs are capabilities particularly in terms
routers, private branch delivering professional of how they serve their own
exchanges and mobile services in new areas such as customers but are held back by
IoT and security. The challenge a lack of internal IT expertise
for telcos is to find a way to and/or a lack of guidance from
make this revenue recurring as service providers.
multinationals/
public sector
it is often a one-time charge.

types of enterprise customers

large

medium

small
1,000 employees

smaller
500 employees

250 employees

50 employees

10 employees

soho self-
employed
1 employee
employees
5,000 +

1% of 99% of
B2B market B2B market

TM Forum, 2021 (based on a graphic from Omdia)

20 inform.tmforum.org
section 3: products & services for the enterprise market

Large incumbent CSPs Breaking it down that are not home to a lot of
(defenders) have business units multinational companies and for
Among the 31 telecoms
dedicated to large multinational operators that are mobile centric
operator groups analyzed
enterprises and government and therefore likely to focus more
in this report only Verizon
bodies, particularly telcos that on SMEs and SoHo customers.
splits revenue across different
operate in multiple countries or
market segments in its financial In the next section, we’ll look at
regions. They have dedicated
reporting. The company divides which of types of services and
account management teams for
B2B revenue, which amounted customer segments are growing.
such customers, and increasingly
to $31 billion in 2020, into four
these teams are expected to
categories as shown below.
understand customers’ business
challenges and opportunities. Most large European operator
Large enterprises make extensive groups, which have sizeable
use of public and private cloud global businesses, likely have
solutions and are keen to leverage a similar breakdown. But the
new technology in areas such as makeup of B2B revenue is very
IoT, advanced analytics and AI. different for CSPs in countries

Verizon's enterprise revenue allocation

2020 total revenue $31 billion

$11.1 $10.4 $6.4 $3.1

2019 total revenue $31.4 billion

$11.5 $10.8 $5.9 $3.2

Year-on-year growth = -1.5%

SME Global enterprise Public sector & other Wholesale

TM Forum, 2021 (source: Verizon)

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SPONSORED FEATURE

BENCHMARK

Huawei “Five Star Best Billing

Benchmark” Model: Building
Five-Dimensional Monetization
Advantages to Capitalize on the
Present and Win in the Future
Amid Uncertainty, “Five Star Best Billing each pillar. It is also possible to
We Need Concrete Benchmark” Model: see the existing gaps in the billing
Solutions Identify Gaps and system capabilities provided by
5G will undoubtedly bring new Define Next Steps suppliers and carriers’ needs. This
allows us to map a path to the
opportunities for services such We believe that billing systems
target stage.
as B2C, B2B, and IoT. However, look to offer five core advantages:
which service will grow revenue Convergent, Cloud Native, Agile, Convergent: System architecture
on a large scale remains unclear Open, and Intelligent. The Huawei is constantly evolving toward
at present. There are no high- Convergent Billing Solution (CBS) further convergence. This includes
grossing 5G B2C applications will continue to build product networks, services, customers,
currently, and 5G B2B and IoT competitiveness based on these and architecture itself. This
are still in the early stages. core pillars. means moving from siloed
This business uncertainty systems, to doing more and
poses challenges to operators’ more on a single platform. This
Five Core Pillars
monetization. To monetize the simplifies management, facilitates
Breakdown
new 5G productivity, what do innovation, improves efficiency,
carriers need? What are the We can subdivide the core and lowers TCO. Currently, CBS
current gaps? And how can pillars into smaller dimensions at offers a single platform for both
carriers inch closer to their different stages of maturity. Then, people and things. Carriers can
objectives? we can map each item to the add new services while retaining
radar chart and clearly visualize their legacy system.
To address these questions, the current and target stages of
Huawei developed the “Five Star
Best Billing Benchmark” model,
designed based on industry best CONVERGENT
practices and latest technology
trends. We applied this model
to evaluate a number of global
sites. The resultant data shows AGILE CLOUD
that most operators still need to NATIVE
strengthen many aspects of their
billing systems to meet future
challenges. CSP’s Legacy System

Vendor’s Latest Capability

OPEN INTELLIGENT Vendor’s Long-term Target

22 inform.tmforum.org
SPONSORED FEATURE

Stage 1 Stage 2 Stage 3 Stage 4

Core Pillars Sub-Dimension

Network Convergence 2/3/4G/PSTN 2/3/4G/5G NSA/FTTX 2/3/4G/5G NSA/FTTX 2/3/4G/5G SA/FTTX

Service Convergence Mobile, Fix Mobile, Fix, TV Consumer, Home, Business, New
Convergent
Customer Convergence B2C B2C,B2B, B2H People & Thing

Architecture Separate construcon for Unified construcon for Convergent for charging, Convergent for charging,
Convergence charging, billing, selement charging, billing billing billing, selement
Private cloud
Cloud Infrastructure Selected public cloud Cloud agnosc Mul-cloud
/Physical machine
Selected applicaon Applicaon fully Applicaon & database fully
Containerizaon Non-containerized
containerized containerized containerized
Cloud Nave
System resources based auto
Auto Scaling Manual resource allocaon Service KPI-based auto scaling
scaling
Manual fault locang and Auto fault locang, Auto fault locang, Auto fault locang
High Reliability
recovery, no DR manual recovery, A-S DR semi-auto recovery, A-A DR and recovery, N-Live

Version Delivery 1-3 months 7 Days 1 day, anyme, anywhere

Version Evoluon Non-smooth evoluon with data migraon Backward compability and smooth upgrade

Agile Product, offering and Plus: Charging factor,

Configurability Plus: Invoicing process and template
template interface, etc.

Diversified Monezaon Stac dimension: Dynamic calculaon Network quality dimension:

Anything rang
Traffic and duraon dimension: Rate SLA
Openness to Service Non-atomized standard
Non-standard interface Orchestrated atomic standard interfaces
Provider interfaces
Open
Openness to SI partner Closely coupled architecture Decoupled architecture Customizaon open to SI CI tool chain open to SI

Stac planning, deployment, Rule based planning, Flexible connecon, Flexible architecture, AI
Flexible Network
scheduling deployment, scheduling opmal roung based dal scheduling
Intelligent Intelligent O&M Reacve Manual Prevenve Condion-based predicve Forecasng predicve

Cloud Native: Cloud native has public clouds, we predict that The cohesion of the ecosystem
become a hot topic among operations platforms such as BSS demands more openness for
carriers in recent years, as it can will not only move to the cloud, operations platform. CBS
significantly lower costs. For but also be deployed on multiple has been adopted for several
example, CBS was able to reduce clouds simultaneously. innovative cases in insurance,
its hardware costs by 50% after Agile: Time to Market (TTM) is an finance, gaming, and other
adopting the bare metal container important indicator for carriers. industries. It assists third-party
architecture. Cloud native Agility can be measured by the service providers and partners
also improves operations and speed at which new versions are by opening billing capabilities
maintenance (O&M) efficiency. delivered, evolution capability, through open APIs. For our SI
After implementing containerized configurability of products, and partners, CBS is in the third stage
databases, CBS is able to expand diversified monetization methods. (shown in the preceding figure),
data nodes within 10 minutes — Most operators still need several enabling them to successfully
a task that used to take weeks months to deliver a version. deliver several projects in Asia.
to complete. In addition, cloud However, CBS can achieve this in Intelligent: 5G will bring
native enhances reliability. After only 7 days once grey release and exponential growth of service
CBS upgraded to N-live multi- continuous delivery (CD) methods traffic. The number of IoT services
active DR mode, system stability are implemented. is huge and the service growth is
improved tenfold to 99.9999%, extremely fast. Operators need
meaning that service interruptions Openness: Industry leaders in
the future cannot be unicorns — a stable, flexible, and efficient
last a total of no more than 31.5 platform more than ever before.
seconds per year. As operators they should be companies with
successful, cohesive ecosystems. CBS has a flexible architecture
become more willing to adopt

23 inform.tmforum.org
SPONSORED FEATURE

Identification Evolution

Customer
Huawei

Customer Scanning Gap Analysis Development Target

Site assessment Gap analysis for Mid to long term target in
based on current 5 core dimensions 5 core dimensions for
Huawei capabilities and sub dimensions customers and Huawei

that currently supports the world’s Network Scanning and Gap Analysis and
largest IoT platform in China with Evaluation Evolutionary Path
more than 1 billion connections
Mapping the capabilities of After scoring each site, we identify
and a huge sharing group with 5
operators’ legacy billing systems the gaps in different dimensions
million members. There are more
to different stages enables us to between operators and vendors.
intelligent methods being planned,
determine system maturity. We We can then depict the customer
such as data adhesion and tidal
can then obtain an overview of portraits combining with
scheduling. In terms of intelligent
the operators’ capabilities. By operators future planning.
O&M, Zero-Touch maintenance is
expanding the scope of scanning, Although an operator’s target
currently available, fault locating
we can see who the all-around is not always identical to a
and recovery with no human
leaders are and how they became vendor’s target, our approach
intervention.
leaders. In this way, we can provides vendors with a clear
ascertain what capabilities other picture for operator so that can
Site Score Percentage operators need to strengthen in give the unique evolutionary
the future. path suggestion. This is not an
8
11 To date, we have scanned more operator-only solution; rather, it
than 200 customers around the is a mutual agreement between
world. The average score is about operators and suppliers about
40, while the latest CBS R21 future development.
reaches an average score of 89.
70
Low scores are mainly due to a
115 lack of evolution agility (because
versions are close to EOS), legacy
technical architecture, and no
convergence for 5G services.
This benchmark model can also
be used for other vendors’ sites.
Excellent(70~100)
High(50~70)
Medium(30~50)
Low(0~30)

24 inform.tmforum.org
SPONSORED FEATURE

Be the Telescope for Appendix - Abbreviations

Operators: Find the CaaS: Container as a service
Galaxy Illuminated
CDR: Charging data record
by Five Stars
DR: Disaster recovery
Following the “Five Stars”
principle, Huawei’s monetization EOS: End of service
platform will implement mid to EOFS: End of full support
long term planning. We hope that
EOM: End of marketing
these five dimensions of concrete
advantages can help operators GA: General availability
build comprehensive capabilities N-Live: Multi-site active/active DR
for future-oriented monetization. technology by Huawei
In today’s constantly changing
NSA: Non-standalone
world, we will be your telescope.
Let the five stars guide you on SA: Standalone
your journey to the future.

25 inform.tmforum.org
 BENCHMARK

section 4:

which enterprise services

have the most potential?
When it comes to increasing B2B revenue, communications service providers (CSPs) envision two phases. In the medium
term, they will look at the strategy for the existing enterprise line of business and is likely to be based on how revenue and
profitability are reported both internally and externally, with the focus very much on the next quarter or current financial
year. Later they will consider how new technology and IT architectures can create new lines of business and revenue.

O
nly 17 of the 31 telecoms reporting, and as noted in the shows enterprise revenue from
operator groups analyzed previous section, only Verizon 2018 to 2020 for CSPs that report
in this report publish breaks down B2B revenue by it separately in their publicly
B2B revenue in their financial type of customer. The table below available financial statements.

B2B revenue for selected CSPs 2018-2020

Revenue (US billions)

2020 B2B % 2020 B2B %

2018 2019 2020 of total rev 2018 2019 2020 of total rev

30.9 34.5 30.5 18% 1.2 1.2 1.2 16%

7.9 7.6 7.4 27% 4.7 4.4 4.4 38%

6.1 6.6 6.1 5% 10 9.8 9.5 19%

1.2 1.3 1.3 3% 2.3 2 2.3 16%

16.9 17.4 18.6 16% 0.7 0.7 0.7 9%

8.1 8.6 9.1 19% 5.8 5.8 5.4 34%

2.5 2.4 2.1 11% 0.6 0.7 0.9 17%

2.3 2.4 2.5 35% 27.8 28.2 27.9 22%

0.9 0.9 0.9 7% TM Forum, 2021

26 inform.tmforum.org
section 4: which enterprise services have the most potential?

The data does not suggest that the Identifying trends in operators’ than consumer services. Operators
telecoms industry is on the verge B2B revenues is also difficult have only just begun to deploy 5G,
of a B2B revenue explosion, even because many of the CSPs and it will be some time before
though operators grew enterprise included in our research advanced core capabilities aimed at
revenue more than consumer (Axiata, Deutsche Telekom, guaranteeing quality of service and
revenue over the period. However, Orange, SingTel, Telefónica , low latency start to have an impact
as noted, the selected two-year Telenor and Vodafone) own on top-line revenues.
period is not enough time to show operating companies in several
definitive trends because of the countries that can be classified The key issues impacting B2B
Covid-19 pandemic which resulted as defenders, challengers and revenue are and will continue to be:
in many businesses delaying prospectors (see page 14).
1. The continued decline of voice
investments and some failing.
Defenders are likely generating revenue – KPN is one of the
Six CSPs have increased B2B 30% to 40% of their revenue from few CSPs that breaks out B2B
revenue. Deutsche Telekom has the B2B market, while challengers voice revenue. In the last three
grown by stabilizing its T-Systems may be realizing less than 10% of years, the proportion of its total
IT services unit and increasing revenues from B2B. Standalone revenue coming from voice
B2B business at T-Mobile in the defenders include AT&T (although services has fallen from 6% to
US. China Unicom has diversified the company has expanded 4.1% in the Dutch market.
beyond its core mobile business aggressively in the consumer TV
2. The stagnation of the core
into fixed broadband and new market in recent years), BT, KPN
fixed/broadband connectivity
ICT services, while KDDI is seeing and Telstra. They all experienced
business – revenues are flat,
strong growth in segments such as flat or declining B2B revenue over
and in some cases declining, in
IoT, cloud and financial services. the two-year period.
many developed markets. The
growing popularity of SD-WAN
Tempering expectations services for businesses is hitting
Looking at the B2B revenue totals revenue that telcos generate
overall, there is little to justify from MPLS, a technique for
excitement about the potential for optimizing data networks. While
future B2B growth. The enterprise MPLS is a relatively expensive
business is not significantly solution, SD-WAN is highly
Defenders are outperforming the consumer competitive, with telcos fighting
to secure a role. However, there
likely generating business, and in some cases
is still strong growth for basic
B2B’s share of total revenue is
30% to 40% of actually declining. fixed broadband connectivity in
their revenue many markets across the world,
from the B2B It is important to consider the particularly mobile-centric
impact of Covid-19 which has markets in the Middle East, large
market, while depressed revenues for 2019 and parts of Asia, eastern Europe
challengers may 2020. While CSPs’ businesses and Latin America.
be realizing generally have held up well over
3. The speed of adoption of
less than 10% the period, operators have been hit
cloud, security and IoT services
by the decline in business activity
of revenues along with business failures and – new ICT services are not easy
from B2B. down-sizing. to scale. Many CSPs now report
revenue for some new ICT
However, even without the services like IoT, although it is
pandemic it is unlikely that telcos’ not clear whether they all define
enterprise businesses would have “legacy” and “new” services in
performed significantly better the same way.

27 inform.tmforum.org
section 4: which enterprise services have the most potential?

The promise of ICT services an estimated 80% to 90% of Industry/vertical solutions

operators’ IoT revenue comes – this is a broad and largely
Traditional managed network
from connectivity. undefined category of
and professional IT services
services aimed at specific
are typically provided only by C
 loud – Telcos are offering vertical sectors such as
incumbent or challenger CSPs that cloud computing services manufacturing or automotive.
have fixed-line businesses. But new including secure WANs for large Potential services likely will
ICT services are much less reliant and small enterprises. Edge split along traditional product
on the fixed network, which could computing for applications lines – namely connectivity,
lead to new revenue through 5G. requiring ultra-low latency could equipment resale and services.
Examples include: also be included, although we However, an emerging
offered it as a separate choice in opportunity lies in service
S
 ecurity – this is a fast-
our survey (see below). orchestration (see page 29).
growing category and one
in which many telcos have M
 anaged mobile private In our survey, we asked CSPs
made significant acquisitions. networks (MPNs) – MPNs are which of these service categories
Security can either be sold as a new and promising line of represent the best opportunity for
a standalone service or as an business. Based on various revenue growth. Security topped
integral part of a managed market research estimates, the IoT but only slightly, with about
network service. MPN market could be worth $5 two thirds of respondents calling
billion to $8 billion by 2025, and each a significant opportunity.
I oT – most operators include
CSPs are positioning themselves About half of respondents believe
IoT within their new ICT
to build and operate them (see cloud services are a significant
services category even though
page 46 for more on MPNs). opportunity for growth.

Best service categories for growth

Security 66.2% 25.5% 8.3%

IoT 65.9% 28.8% 5.3%

Cloud computing 49.6% 39.9% 10.5%

Managed & 44.5% 39.9% 15.8%

professional services

Edge computing 43.1% 41.5% 15.4%

Marketplaces 36.6% 42.0% 21.4%

Platform businesses 35.4% 48.1% 16.5%

Significant opportunity Moderate opportunity Minor opportunity

TM Forum, 2021

28 inform.tmforum.org
section 4: which enterprise services have the most potential?

Service orchestration represents a new opportunity for CSPs

Roles for CSPs in delivering 5G services

CaaS/value-added connectivity
• operator delivers customized connectivity offerings
(using network sliding) to enterprises and third-party providers
• services are fully configurable and flexible using self-service digital tools
the enterprise • other solutions offered to enhance connectivity such as network security
buys 5G as a
connectivity/
communications
service

end-to-end service
operator is responsible
for an end-to-end service,
most likely delivered
with the help of many
the enterprise partners
connectivity buys an ICT
operator sells solution enabled
by 5G
standard 5G
connectivity
products (mobile platform
and fixed) to full • operator participates in a platform business model as either the platform
range of business owner (with responsibility for going to market) or a platform participant
• in addition to connectivity, operator provides other enabling capabilities
such as billing, location services, network analytics, hosting or security
TM Forum, 2021 • foundational services could include connectivity, CaaS or NaaS

Service orchestration is a potential the process of stringing those tasks new services to enterprises
role for CSPs in delivering ICT together. Service orchestration is using a platform business model.
solutions to large enterprises. The needed across network elements Integrating partners has always
graphic above, originally published and cloud computing functions, been a B2B requirement, one
in our December 2020 report on whether they are in a CSP’s network, that professional services firms
enterprise 5G, shows four possible the public cloud, an edge cloud typically provide. But the process
roles for CSPs in delivering 5G. or the enterprise’s private cloud. becomes more complex, and more
Service orchestration could happen This process is critical to reducing crucial, as partners come together
on either side of the diagram, and in complexity. in platform business models.
some cases could overlap the roles.
It may be a tough sell with The more capabilities within an
Service orchestration as an enterprises, however, because they overall B2B solution that a CSP
extension of connectivity do not necessarily view connectivity can provide, the better its chance
and network orchestration as of playing the service orchestrator
Service orchestration as an
important to their business goals. role. For example, a telco with
extension of connectivity is how
Their primary focus is on the a strong existing professional
CSPs envision providing network
application or capability and the IT services practice, an established
slicing, which is a key promise of
that enables it, and connectivity may role as a reseller of hardware and
5G. In a 5G core, network functions
or may not be required as part of the cloud services, and a track record
running as software on virtualized
solution. If connectivity is needed, in managed services has a good
infrastructure allow operators to run
it likely must fit into an existing shot at fulfilling the role because
separate networks over the same
architecture rather than a new one it already captures a large part of
physical infrastructure. Using slicing,
built around connectivity. the overall value proposition.
CSPs can allocate specific resources
to an application, service, set of Service orchestration as the Telcos will incur costs in
users or network. coordinator of a complex delivering both types of service
partner ecosystem orchestration. In Section 12, we’ll
Orchestration builds on the growing
look at ways for them to not
use of automation in networks. Some CSPs envision acting
only recoup these costs, but also
While automation eliminates manual as a coordinator of a partner
increase revenue.
network processes, orchestration is ecosystem that seeks to deliver

29 inform.tmforum.org
section 4: which enterprise services have the most potential?

Operators reporting revenue from In some cases, the managed services is well below that of
new ICT services include a mixture services business is seen as a “pull global professional services firms.
of defenders and challengers. through” for the higher-margin
For the defenders, this revenue managed network business and Defender operators need to
compensates for the loss of justifies accepting a lower level of transform their professional
legacy revenue. For challengers, it profitability. services organizations if they
represents net revenue growth. hope to rely on them for revenue
CSPs dominate the managed growth. Global consulting firm
We have not attempted to assess services business with some limited Bain & Company suggests that
the profitability of new ICT services competition from professional telcos need to increase speed
in this research, although our services firms. However, the IT and agility to be more like the
assumption is that even the most services landscape is much bigger technology services sector.
successful operators are recording and more competitive. In general,
low, single-digit EBITDA (earnings the further the services business This requires continuous
before interest, taxes, depreciation is from the network, the less innovation, constantly evolving
and amortization) margins. competence and fewer capabilities partner ecosystems, making
the telco is able to offer. professional services an integral
In addition to highlighting new ICT part of managed services offerings,
revenue, some CSPs break down and optimizing use of staff
lines of business within the overall
What’s IT worth? resources and talent. In terms of
B2B category. We’ll explore some The market for IT services is huge, business models, Bain foresees a
of these opportunities later in the with multiple independent research combination of low-margin, people-
report. firms putting the value at around $1 focused services that do not scale
trillion. Players include: and higher-margin, subscription-
Professional services based services that can scale
Global professional services through a platform business model.
Most new revenue opportunities firms such as Accenture, IBM,
for CSPs sit within the managed Wipro and Infosys which It’s worth noting that CSPs
and professional services serve large multinational have varied relationships with
categories – a broad, diverse set organizations (for example, professional services firms and IT
of services that require many Accenture works closely with service providers. They are big users
new skills and capabilities. Many hyperscale cloud providers) of their services, particularly when
telcos have large managed and it comes to integrating back-office
professional services businesses. Global and regional systems systems. Professional service firms
Companies like BT, Deutsche integrators specializing in also provide strategy consulting
Telekom, Orange and Telefónica, technology and IT (for example, services across different parts of
for example, generate between NEC, Presidio and SCSK the organization.
30% and 40% of their B2B Europe)
revenues, or 10% to 13% of total When it comes to providing
Specialist IT services companies services to customers they
revenues, from professional
that focus on specific regions often partner – for example, if
services.
or industries (for example, the an enterprise expresses a clear
A large part of this business is UK’s National Health Service has preference for working with a
managing enterprises’ networks a dedicated division called NHS specific systems integrator. But they
and in some cases IT systems. Digital which buys services from are also becoming competitors as
Services typically are customized, healthcare-focused IT service some CSPs are seeking to build
with telcos securing contracts by providers) new revenue streams by providing
offering to manage their clients’ digital transformation services to
There is little data available to
systems at a lower cost than the businesses.
compare the profitability of CSPs’
enterprise would spend doing it
professional services practices In the next three sections, we’ll look
in-house.
with the other three types of more closely at the most promising
CSPs have targeted this business providers. However, based on new lines of business: security, IoT
in the past expecting to build our research and conversations and cloud services.
synergies and scale that allow with both CSPs and systems
them to significantly reduce costs, integrators, we believe that
but they have had mixed success. CSPs’ profitability in professional

30 inform.tmforum.org
 BENCHMARK

section 5:

security services are an

emerging sweet spot for telcos

Security, especially cybersecurity,

is a growing challenge for all Total security services revenue for telecoms
enterprises as they accelerate worldwide 2018-2020
digitization of their networks,
operations and relationships 10.0
with customers. It is an issue for 9.0
Revenue (USD billions)

communications service providers 8.0

(CSPs), too, but it is also one of 7.0
their best opportunities to tap new 6.0
revenue as providers of managed 5.0
security services. 4.0 40% 18%
growth growth
3.0

I
n the survey conducted for this 2.0
report, CSPs chose security as the 1.0
most promising sector for new
0.0
revenue growth with two thirds 2018 2019 2020
calling it a significant opportunity.
TM Forum, 2021
Based on our research, we estimate
that revenue for security services
grew by almost 20% in 2020.
Security services revenue for selected CSPs 2018-2020
(USD millions)
2020 Security %
2018 2019 2020 of total revenue

N/A N/A 481 0.4%

535 661 879 1.8%

404 416 415 3.6%

260 1,073 1,204 7.2%

N/A 490 552 1.1%

TM Forum, 2021

31 inform.tmforum.org
section 5: security services are an emerging sweet spot for telcos

Telcos deliver expert security

1,500 2,000 2,500 2,000

experts experts security experts security experts

12 8 18 9
SOCs in Europe, SOCs globally SOCs & 11 SOCs globally
Latin America and cybersecurity SOCs (via its Trustwave
North America subsidiary)

Telcos’ businesses are country’s entire population. they need to employ large teams
particularly susceptible to But in implementing policies, of cybersecurity experts and
security breaches. They face strategies and technologies to offer products and services that
prolonged attacks, in some thwart cyberattacks, they have enable enterprises to anticipate,
cases from foreign governments, developed capabilities they identify, prevent, detect and
which can go unnoticed for can sell. respond to attempted security
long periods of time. CSPs are breaches. It is not uncommon for
targeted because they operate Many CSPs offer managed a telco to employ 2,000 or more
critical national infrastructure security services to enterprises experts in its security operations
and deliver connectivity to a of all sizes. To perform this role, centers (SOCs).

32 inform.tmforum.org
section 5: security services are an emerging sweet spot for telcos

Acquiring security expertise Timeline of telco security acquisitions

Most large CSPs have bought Informatica 64
JUNE
security companies to get into Telefónica's Eleven Paths
the managed security services 2013 security subsidiary is the result
business or to bolster their
strategies. In some cases the AUG
Trustwave
operators have allowed the Provides managed security
companies to retain their brands 2015 services globally; $582m deal
and continue operating with a
degree of autonomy. NOV
Cognevo
New Zealand-based cybersecurity
Orange, for example, made two 2016 analytics firm; $2m deal
major acquisitions – Secure
Link and Secure Data – and MAY
ADT Caps
both continue to operate as Physical security specialist;
standalone businesses. But the 2018 $1.2bn deal
telco also offers security services
via its Orange Business Services JULY AlienVault
subsidiary. Provides cybersecurity
2018 detection & response
While Secure Link and Secure
Data offer pure-play security SecureData Group
JAN
services and serve a whole range Largest independent cybersecurity
of medium and large companies, 2019 service provider in the UK; $164m deal
Orange Business Services mainly
offers security as part of larger ProtectWise
JAN
managed telecoms infrastructure Provides a cloud-based network
projects. Such projects 2019 detection & response platform
increasingly focus on the transition
United Security Providers
to cloud-based technologies, FEB
Provides managed security services
adoption of edge computing and
new vertical market use cases.
2019 for enterprises; has 200 specialists

SecureLink
MAY
Provides specialist services, consulting,
2019 maintenance; $629m deal

SK Infosec
JULY
Provides managed security
2019 services to 570,000 customers

Help AG
JUNE
Provides secure cloud enablement
2020 & secure access service edge

Govertis
JUNE
Advisory firm specializing in
2020 governance, risk & compliance

iHackLabs
AUG
UK company specializing in
2021 cybersecurity testing & training

Safe Security
AUG
BT was the lead investor in a
2021 $33m round of funding

33 inform.tmforum.org
section 5: security services are an emerging sweet spot for telcos

Drivers for managed security services €181 billion

>8 %
AG R
C
€113
billion
Growth drivers:
€100billion
Increase in value of
digital services leads
Companies
increasingly relying on
managed services due
to more cyberattacks
to skills shortage

Diversification of IT
Amplification & Stricter
landscape (e.g. moving
sophistication of regulatory
2018 2019 cyberattacks frameworks
to cloud) introduces
complexity & risks 2025
Hardware/software Services

TM Forum, 2021 (source: Gartner & Orange)

Growing the business Types of services companies’ employees to

scams using emails, text
The cybersecurity market is Traditionally, enterprises have
messaging and voice calls.
growing by 8% per year according taken a siloed approach to security,
While the bring-your-own-
to Gartner, which gives it an spending separately on hardware
device trend is not new, the
approximate value of $150 billion security, identity protection and
increase in home working will
in 2021. If CSPs could capture just managed devices. But the growing
necessarily result in wider use
10% of the total market, it would threat posed by cyberattacks is
of corporate applications on
equivalent to almost 1% of total leading many to adopt a more
employees’ own devices.
telecoms revenue. holistic strategy that includes buying
consulting and auditing services.
CSPs are relatively small players Breakdown of Orange
in the security services market, Following are the areas that most Business Services’ security
which is dominated by global IT enterprises want to protect from revenue by business model
services companies such as IBM, cybersecurity threats:
Accenture and Atos, alongside 10%
specialist firms such as DXC N
 etworks – many large
Technology and Secureworks. organizations operate private
However, several Tier 1 operators networks that require the
35% 15%
are already generating significant same kind of security as the
revenue from security services, public network. As enterprises
either through acquisitions or increase their use of software-
acquisitions plus organic growth. defined wide area network (SD-
They include AT&T, BT, Deutsche WAN) services, vulnerability
Telekom, NTT, Orange and Verizon to security breaches increases
which all provide a wide range because each internal router 40%
of security services to large and connects into the public
medium enterprises. Based on internet rather than a dedicated
the companies’ publicly reported private network. Consulting
financial data and our estimates, Integration
Remote workers – the

we believe each is generating at Managed security services
growing popularity of home-
least $100 million in revenue, and Equipment reselling
working, particularly during
some could be generating close to
the pandemic, has exposed
$1 billion. TM Forum, 2021

34 inform.tmforum.org
section 5: security services are an emerging sweet spot for telcos

Cloud networks – enterprises

 Large enterprises, particularly Security for consumers
are increasing their use of in verticals such as financial
While security services are
public and private cloud services, have built considerable
principally aimed at enterprises,
services. Hybrid cloud in-house cybersecurity expertise,
some CSPs offer security services
networks require the same but a large proportion of small
in the consumer market. For
kind of protection as private and medium enterprises (SMEs)
example, Swisscom has launched
communications networks. do not have internal expertise.
a travel insurance service called
Generally, the more suppliers, Even if they wanted to hire talent,
Easy Cyber Insurance which offers
networks and systems they likely could not as a global
customers legal protection while
involved, the greater the shortage of security experts
web-surfing and smartphone
security risk. and the high cost of recruiting
protection.
such talent are insurmountable
IoT – most large organizations
 obstacles. For these companies, South Korea’s SK Telecom has
are deploying or planning to using a managed security service a dedicated security services
deploy IoT networks, and given is the most viable option. subsidiary called SK Infosec which
that such services will often
offers a full range of physical
support critical applications,
security is a primary concern.
Telcos gain confidence security products, software and
services. The telco is planning an
Researchers have identified As noted, CSPs offer security
initial public stock offering for
real or potential security risks services through SOCs, where
its security business and aims to
through devices as diverse experts identify, investigate,
position it as a “Life Care Platform
as light bulbs, printers, gas prioritize and resolve potential
Provider” that “assures safety and
stations, smart speakers and or real security issues. Operators
protects lives and properties of
security cameras. build SOCs wherever they have
people…by encompassing physical
large numbers of customers, so
and cyber security domains.”
the telcos offering global services
have the most SOCs. Orange, SingTel and Telefónica
publish annual or quarterly
Many operators now talk
revenue numbers for their security
confidently to their shareholders
businesses, while other CSPs
about the performance and
Even if small and provide “snapshots” of their
potential of their security
medium enterprises businesses. For example, Orange
security businesses. For example,
Deutsche Telekom’s T-Systems
wanted to hire talent, Business Services held a half-day
professional services subsidiary
they likely could not analyst event in August with a
discloses the percentage of its
specific focus on security services.
as a global shortage total revenue that comes from
Orange splits its revenue from
of security experts security services.
security services into four
and the high cost of categories: consulting, integration, Swisscom reports that its security
recruiting such talent managed security service and revenue doubled between 2016
are insurmountable equipment resale. The first three, and 2020. Telecom Italia’s security
which represent 75% of Orange’s revenue, which comes from its
obstacles. For these
total security revenues, include dedicated Telsy subsidiary, grew
companies, using a IT services and require the by 20% year-on-year in the
managed security deployment of large teams of first quarter of 2021. Vodafone,
service is the most experts. Orange has 2,500 security meanwhile, aims to triple its
experts worldwide. security revenue between 2021
viable option.
and 2025.

35 inform.tmforum.org
section 5: security services are an emerging sweet spot for telcos

Security services growth forecast to 2024

12
$12bn

10
Revenue (USD billions)

$9bn

2
2018 2019 2020 2021 2022 2023 2024

Conservative growth Aggressive growth

TM Forum, 2021

Security services outlook As noted in the introduction to this Rather than partnering with firms
report, this forecast and others that provide professional security
CSPs’ security services businesses
are based on a combination of services, some small CSPs may
will grow with more deployment of
moving-average model forecasting choose to partner with Tier 1
new connectivity and computing
from historic data, analysis of telcos. For example, earlier this
services such as 5G, cloud, edge,
growth actuals from comparable year Telekom Malaysia announced
IoT and mobile private networks.
segments (in telecoms and IT that it is working with Telefónica
The adoption of open architectures
sectors), and adjustments for Tech, an ICT services division that
to support these services will
current market pressure resulting Telefónica launched in 2019 (see
increase the points of vulnerability
from the pandemic. page 43), to develop a global
in enterprise networks, systems
cybersecurity strategy for the
and processes. CSPs with smaller enterprise lines Malaysian market.
of business are likely to find it
CSPs that have already invested
difficult to make a case for buying In the next section, we’ll look at
heavily in security capabilities
or building a security services growth potential for IoT services.
are confident about the potential
business, but they can partner to
for growth and synergy between
develop capabilities. Vodafone,
their security and core network
for example, is targeting the SME
businesses. We believe that
market through a partnership with
revenue growth rates of 10%
Accenture.
annually are realistic for this group
of operators.

36 inform.tmforum.org
 BENCHMARK

section 6:

IoT services continue to post

strong growth

In the survey conducted for

this report, more than 65% of Total IoT revenue for telecoms worldwide 2018-2020
communications service providers
(CSPs) chose IoT as the second 20
most promising sector for new 18
Revenue (USD billions)

revenue growth, just behind 16

security services. While the last 14
five years have not witnessed 12
the explosive growth that many 10
observers predicted for IoT devices
8 34% 23%
and services, our research finds growth growth
6
the sector performing well, posting
double-digit percentage growth. 4
2

A
T&T, China Mobile and 0
Vodafone are hitting 2018 2019 2020
or nearing $1 billion in TM Forum, 2021

annual revenue from their IoT

lines of business, with China
Mobile showing significantly
IoT services revenue for selected CSPs 2018-2020
more growth in the number of
(USD millions)
new connections than telcos 2018 2019 2020 2020 IoT % of
total revenue
in Europe and the US. Due to
the wide variation in types of 303 443 614 1.4%
products and services under
the IoT banner, many operators 53 62 68 1.1%
are deploying an agile platform
model from which to launch 55 60 66 0.9%
many flavors of service, with
CSPs in China leading the way 221 231 236 0.5%
(see page 38).
81 90 105 0.7%

90 113 135 1.6%

138 145 151 1.0%

747 920 1,149 2.2%

TM Forum, 2021

37 inform.tmforum.org
section 6: IoT services continue to post strong growth

Some telcos are specializing in

Operators in China lead on IoT architecture industry verticals where they
anticipate good growth. AT&T, for
The operational architecture that To advance its IoT capabilities, example, is making a push in the
mobile operators are deploying China Unicom Group is using automotive sector, while Vodafone
to maximize IoT success is a blockchain technology and is marketing solutions for smart
good example of the future APIs to develop a centralized agriculture. The pandemic has
mode of operations that CSPs data-sharing platform across affected IoT growth because most
are targeting with the TM Forum 31 subsidiaries. The platform is services include an end device
Open Digital Architecture, part based on the ODA and uses 25 that field engineers must install.
of the Open Digital Framework Open APIs along with other TM So, CSPs’ abilities to deliver were
(see page 75). China Mobile and Forum assets. It relies on using curtained slightly during 2020 and
China Unicom are particularly mobile numbers to verify users the first half of 2021.
advanced in their development. and allows data to be referenced
between systems, rather than Waves of connections
The world’s largest IoT provider, replicated.
China Mobile is cooperating with IoT has been a focus for many
nearly 1,600 member enterprises China Unicom is using the B2B mobile operators as it centers
on IoT categories including platform to share data with over around their core competency of
transportation, logistics, power 1,000 enterprise customers in delivering wireless connectivity to
grid, home appliances, security more than 20 industries, such as devices with additional services
protection, healthcare, industry, banking, insurance, technology, on top. However, the first wave
agriculture, and environmental ecommerce, aviation, real estate, of mass-produced IoT devices
protection. In order to address consulting, handset vendors, were for applications like utility
these diverse use cases, they government, education, media, meters, smart buildings, inventory
have deployed an open and agile manufacturing and tourism. management, fleet management
business platform for service This includes 74 automotive and smart manufacturing.
innovation utilizing: companies responsible for
around 15 million connected cars. These use cases have presented
Cloud native software a challenge for CSPs because
Read this case study to learn connectivity can be provided by
Microservice architectures
more about China Unicom’s competing providers. The use
built to industry standards
approach cases require small amounts of
with TM Forum Open APIs
data to be sent on a semi-regular
Metadata drivers basis, and the devices are usually
Layer-by-layer decoupling in fixed positions within buildings,
between services so alternative connectivity
arrangements can be made using
DevOps development
Wi-Fi or LoRa, for example.
methodologies
While LTE has not been
The roll out of service versions
used widely for wireless IoT
takes weeks instead of
connectivity, use of 5G is growing
months, and China Mobile
for applications in the automotive
has been working on shifting
sector. AT&T has brokered a deal
the focus from being a data
with General Motors to bring 5G
pipe to differentiated network
connectivity to millions of vehicles
capabilities, and from simple
coming off the assembly line in
services to multi-services and
the US over the next decade,
convergence, which has been
while Deutsche Telekom has
one of the key challenges for
formed a partnership with BMW
mobile operators looking to
to provide 5G connectivity to
build their IoT business over the
all new connected vehicles via
last decade.
eSIM. This is the new wave of IoT
which will require high bandwidth

38 inform.tmforum.org
section 6: IoT services continue to post strong growth

connections to moving vehicles The role of 5G will not be restricted IoT connectivity conundrum
for telemetry data and to mobile devices, however. In the
However, a looming and potentially
entertainment packages. fixed wireless replacement model,
serious challenge for CSPs is that
5G eSIMs may be embedded in
CSPs are optimistic about growth the IoT value chain is often best
consumer devices like smart TVs
in business models such as this, served by specialist integrators
so that they can be connected to
because much of the work going and platform providers, not the
wireless networks instead of home
into perfecting connectivity for connectivity provider (see below).
broadband. Mobile operators are
connected cars is paving the way for This means it is difficult for telcos to
leveraging the characteristics of
autonomous vehicles, where mobile win a dominant share of total service
5G to innovate new partnerships
operators could offer network slicing revenue. Our research finds that the
with manufacturers to establish
for vehicles in future, high-value connectivity portion of the value
new lines of business across
service models. chain is currently only worth around
many verticals.
5% of the total value of an IoT deal.

Drones-as-a-service shows potential roles for CSPs & partners

Devices
In some early proofs of concept, smartphones have been
strapped into the drone. For full commercial deployments,
5G modules will need to be embedded into the electronics
of the drone itself.

Applications development
Drones-as-a-service will likely involve the use of applications
built on geographical information systems. These apps will
need to be customized for sectors such as agriculture, utilities,
and oil and gas production, and for segments within each
vertical. For example, drone applications could be used to
increase efficiency or improve security for utilities, or to
monitor pest damage and identify growth in agriculture.

Applications deployment & enablement platforms

This role can be played by different types of companies, but it
is often played by drone operators. Zipline, for example,
specializes in delivery of medical supplies via drone.

Connectivity
Drones rely on wireless connectivity. Communication is needed for
management to support authentication and authorization, while
command and control communication is needed to fly the drone.
Payload data transmission is also needed to support the applications
onboard the drone, such as high bandwidth video streaming for news
gathering. For collision avoidance, drones may require means to
communicate with other nearby drones.
Software infrastructure
Drones can generate huge amounts of data based on the application
and number of units deployed. Some of this may be extremely time
sensitive and require immediate processing to generate real-time
insights. Drone operations and data processing likely will take place in
a public cloud to meet these objectives, ensure security and help
applications scale.
Systems integration
Today drone operators handle systems integration Hardware infrastructure
Remote gateways to process, filter and upload real-time information to
with help from specialist firms, but large global
the cloud are needed, as well as a drone control station.
systems integrators are also beginning to build
competence in this area. CSPs could partner or
acquire expertise to offer management of
drones-as-a-service.

Breaking down the revenue potential of an IoT deal

55% 40% 5%

Hardware modules & devices Applications & enabling platforms Connectivity

TM Forum, 2021

39 inform.tmforum.org
section 6: IoT services continue to post strong growth

IoT growth forecast to 2024

35

30
$29bn

25
Revenue (USD billions)

$24bn

20

15

10

0
2018 2019 2020 2021 2022 2023 2024

Conservative growth Aggressive growth

TM Forum, 2021

CSPs need to widen their main contractor and therefore will be able to deliver turnkey
influence, and the most likely way are not winning large portions solutions and lead partner
to do this is by delivering software of revenue from the deals. We’ll ecosystems, which should appeal
applications. Indeed, this is where discuss this more in Section 9. to enterprises. Standalone 5G
most revenue growth for mobile will have a catalysing impact on
operators is happening – enabling IoT outlook IoT as many operators believe
B2B2X business models centered network slicing will unlock a new
around connectivity offerings. IoT has been the big hope for the wave of opportunity for machine-
telecoms industry over the last to-machine communications.
Vodafone Business, for example, decade, and indeed it is the largest
is taking a platform approach to of the new service categories In the next section, we’ll look at
providing IoT connectivity, device we have analyzed. The potential the revenue potential for cloud
management and application for growth in IoT is somewhat services.
enablement all in one bundle. limited because CSPs are only
From these platforms, business delivering connectivity as part
customers are given a one-stop- of the solutions. If they can start
shop to start building their own to add value in applications and
innovative offerings. enablement of applications, the
potential for growth is huge.
Many mobile private networks
(MPNs) are industrial site The diverse nature of IoT use
deployments that include a large cases is an operational challenge
number of IoT connections. The for CSPs. But as operators
problem for mobile operators, continue to move towards a
however, is that they are not the service platform model, they

40 inform.tmforum.org
 BENCHMARK

section 7:

could cloud services become

big business for CSPs?

In our survey of communications

service providers (CSPs), cloud Total cloud services revenue for
computing services such as telecoms worldwide 2018-2020
secure wide area networks
18.0
(WANs) for large and small
16.0
Revenue (USD billions)

enterprises are another strong

opportunity for revenue growth. 14.0
Indeed, our research finds that, 12.0
like IoT services, cloud services 10.0
experienced double-digit
8.0
percentage growth from 2019 to 16% 21%
2020, and we are forecasting that 6.0 growth growth

this trend will continue into 2024 4.0

as CSPs leverage their existing 2.0
relationships with enterprises to
0.0
increase loyalty.
2018 2019 2020

C
TM Forum, 2021
SPs are migrating their
own IT workloads to the
cloud as part of ongoing
digital transformation programs. Cloud services revenue for selected CSPs 2018-2020
In doing so, they are building (USD millions)
a large pool of skills that is
transferrable to providing cloud 2018 2019 2020 2020 cloud %
of total revenue
services to business customers.
Much of the sales activity in 140 349 559 1.3%
this segment is happening with
telcos’ existing customer base as 0.1%
87 91 94
CSPs draw on the relationships
they have with companies to
deliver business connectivity. 248 295 297 12.3%

594 708 887 1.8%

52 58 64 0.7%

301 303 306 1.9%

TM Forum, 2021

41 inform.tmforum.org
section 7: cloud services are becoming big business for CSPs

Edge & ecosystems enterprise customer with a single degree telcos’ ambitions to reach
interface to manage everything beyond domestic or local markets
Several of the CSPs we
in the ecosystem, from cloud have decreased. This is mainly
interviewed for this report said
storage to management and due to the infrastructure costs
they are exploring how to provide
orchestration. involved at global scale, but cloud
cloud platforms for multi-access
adoption may reset the return-
edge computing (MEC). For With the increasing complexity on-investment calculation for
example, Singtel is leveraging and cost of point-to-point operators with global reach.
investments in MEC over the last communications for private cloud
few years to offer a high-speed, and the security concerns of public CSPs are still adjusting to
low-latency connectivity package internet connections, this kind of commercial and operational
bundled with edge cloud services. offering is resonating well with relationships with hyperscale
The aim is to address enterprise business customers looking for a cloud providers. When we asked
markets where customers need trusted supplier to pull the whole CSPs what role hyperscalers will
the cloud to run data analytics arrangement togther. In many play in their growth strategies,
and AI applications at the edge. cases, these business models more than half said that telcos will
overlap with telcos’ security jointly develop and market new
Combined with 5G radio access
businesses (see Section 6). services with hyperscalers.
networks, a platform model like
this can address many new B2B Some large CSPs are aiming
service models. A good example Building clouds to supply cloud services to
is an industrial application such as CSPs with a network of data government bodies. Vodafone
robotics in manufacturing plants, centers have been able to Business, for example, offers
where the operational data for the leverage existing infrastructure a private cloud solution
plant needs to be stored at the by building clouds and delivering called Flexible Computing for
edge in order to lower latency and services using a blend of their Government, which features
ensure super-fast reaction times. own capacity and that of cloud hightened security for the
providers including Amazon Web storage and transport of sensitive
Another growth area in CSPs’
Services (AWS), Microsoft Azure data. Building industry-specific
cloud services portfolios is
and Google Cloud Platform. BT solutions like this is testement to
connecting existing clouds, or
Global Services is taking this path the concept of a cloud delivery
augmenting cloud ecosystems
to market to establish a wide platform, where features of cloud
with advanced connectivity
geographical reach beyond its configuration and connectivity
options. For example Verizon’s
own domestic markets. can be fine tuned to meet a set of
Secure Cloud Interconnect
specific needs.
offers a private connectivity However, few operators been
suite for connecting multiple successful building a global
clouds without using the public network of data centers to
internet. The service provides the deliver B2B services, and to some

Role for hyperscalers in CSPs' growth strategies

We will jointly invest in new
capabilities, technologies & 45.9% 33.9% 20.2%
architectures

We will jointly develop & 50.9% 39.8% 9.3%

market new services

We will resell their services 41.2% 45.0% 13.8%

They will resell our services 24.8% 43.8% 31.4%

We expect to pursue this approach We may pursue this approach We do not expect to pursue this approach
TM Forum, 2021

42 inform.tmforum.org
section 7: cloud services are becoming big business for CSPs

Cloud services growth forecast to 2024

20
Revenue (USD billions)

18 $18bn

16 $16bn

14

12

10

8
2018 2019 2020 2021 2022 2023 2024

Conservative growth Aggressive growth

TM Forum, 2021

Acquiring expertise better for the telco to allow these Cloud outlook
units to retain their autonomy in
Telefónica used an acquisition Not all CSPs are sold on providing
order to promote innovation and
strategy to create a new business cloud services because they worry
brand awareness. We expect to see
unit to address the cloud services that new service models could
more acquisition activity as CSPs
opportunity. Telefónica Tech helps cannibalize existing B2B revenue
look to exploit their current growth
corporations migrate their IT in areas like data storage. However,
into the cloud services space.
operations onto cloud platforms progressive operators such as
such as AWS, Google Cloud Telefónica and Verizon have taken
Platform and Microsoft Azure, and Managing multi-cloud what they are learning on their
then sells its own services such as own journeys to the cloud and
In their own migration to the cloud,
connectivity, cybersecurity and big packaged it as services for large
CSPs are concerned about the idea
data analysis on top. and small enterprises.
of being locking into a relationship
Telefónica Tech acquired Altostratus with a single cloud provider for We are forecasting reasonably
Cloud Consulting, a multi-cloud certain IT systems. To address this, strong revenue growth from a small
expert and Google Cloud Platform they are partnering with vendors number of CSPs for the medium
partner, and Cancom, a UK-based like Red Hat which provides a term. Success beyond that will
professional and managed services management layer for multiple depend entirely on the competitive
company specializing in multi-cloud public clouds using a multi-cloud landscape.
and security. aproach. Now telcos are looking to
use their multi-cloud experience to If business customers can get
The strategy is paying off. offer similar services to enterprises. world-class cloud services from
Telefónica’s revenue from cloud their existing connectivity provider
services increased by more than Businesses often don’t do a good as part of a bundle, they likely will.
20% in 2020, and cybersecurity job of tracking the resources they However, if the services on offer
sales rose 12%. Indeed, the are using compared against their from hyperscale cloud providers
company had the highest growth bills. CSPs can help by enabling are superior, with low-friction
of companies we tracked in this them to pay for exactly what they onboarding and integration, then
sector. Interestingly, Telefonica is use. Telstra, for example, offers CSPs may struggle to grow their
now considering selling a stake in a suite of cloud management cloud services businesses.
Telefónica Tech. services designed to give
customers choice and flexibility in In the next section, we’ll look at
Acquisitions can bring new talent using multiple cloud providers while some other new ICT services that
into the CSP, and generally it is optimizing costs based on usage. are likely to lead to revenue growth.

43 inform.tmforum.org
SPONSORED FEATURE

BENCHMARK

How VoltDB Active(N)

Changes the Game for Cross
Data Center Replication
With cloud communications taking over and creating a myriad of new opportunities and challenges for
enterprises of all types, one topic has taken center stage in the quest for cloud domination: 5G. 5G technology
will empower cloud service providers to quickly and easily reach enterprise mobile customers with more
features and options and quicker service than ever before, even in remote areas. But achieving faster
connections with more varied services isn’t easy. 5G has made it possible, but other technologies and strategies
will be needed to make it a reality. Cross data center replication (XDCR) is one of these technologies, but it
needs to be done right for it to really work and deliver 5G monetization.

XDCR and The how many copies there are that leads to a customer losing
Operator’s Dilemma or what transient network money due to inaccurate
events happen. billing).
Historically, operators have had
to choose two of three network
attributes: low latency, application Q: Why haven’t operators Learning to Live With
resiliency, or data consistency. been able to have all three Compromise
They could always have two of the of the above? Early distributed data platforms
above, but never all three. Because regardless of what attempted to deal with this dilemma
First let’s define our terms: application they’re running, by employing two data centers at
they need to reconcile two once (ie, the first form of XDCR),
Low latency, for our purposes,

conflicting requirements: with one being the ‘active’ copy
means consistent responses
the requirement for their that would stream data changes to
within a couple of milliseconds
applications and data to be in a ‘standby’ copy that was generally
within a data center or within
multiple geographic locations readable but not writable.
a few tens of milliseconds if
at once to avoid data loss in While this looked good on a
queried by a device outside
the case of downtime, and whiteboard, real-world experience
the data center.
the need for these same proved otherwise. In the real world,
Application resiliency means
 applications to respond within the decision to make the ‘standby’
‘‘five nines’, or 99.999%, single-digit milliseconds to system an ‘active’ one involved a
uptime, which means no more customer requests. human at the ‘standby’ site making
than about six minutes of
This created a dilemma: a decision for it to become active,
downtime a year.
respond fast (ie, in time to even when the human didn’t
D ata consistency means
 make the perfect offer at the actually know for sure that the
your data copies always stay perfect moment, for example, active site was down (only that it
the same and when changes or to keep a customer was uncommunicative). For this
happen in one place the engaged), or respond and other reasons, the first form of
same changes happen in accurately (ie, without losing XDCR was prone to failure and over
the other place, no matter data or creating a data conflict time operators began to demand

44 inform.tmforum.org
SPONSORED FEATURE

systems where both data centers meet aggressive, single-digit to buy more credit, or a revenue
maintained exact copies of the data millisecond latency targets, leak because in the process of
at all times; in other words,‘active- devices need to communicate ‘fixing’ the data you chose to
active’. via the nearest data center and forget about a business event.
However, this shift to active-active not just the active one. As a
opened up a different can of worms, result, all data centers in an XDCR How VoltDB’s Active(N)
because it made it physically system need to be able to accept Makes Telco-Grade Active-
possible to change the same record changes, making data conflicts Active-Active XDCR
in two places at once, leading to the unavoidable. And with data Practical
dilemma described above. conflicts come customer-losing
secondary consequences such as VoltDB’s Active(N) Lossless
lost data and fraud. XDCR employs three or more
And Then There Were Three data centers with timestamp-
Modern data platforms attempt to based reconciliation and both
While active-active configurations solve the data-conflict problem in
allowed survival of a site application- and database-level
one of two ways: conflict resolution to allow telcos
outage, they didn’t answer the
question of how to do planned By using conflict-free replicated to maintain five nines uptimes,
maintenance. Because regardless data types (CRDTs) to merge while maintaining data accuracy
of whatever time you devote numerical changes (so if two and extreme low latency. VoltDB
to making application-level people spend $3 of a $5 balance is the only data platform that
upgrades painless and fast, the at the same time, the sites end can do this.
reality is that the entire stack up with a balance of -$1), OR Active(N) paves the way for
below the application also needs By arbitrarily picking a “winning” seamless conflict resolution in
periodic scheduled downtime, transaction and discarding the multi-active XDCR systems,
and no vendor is in a position to other transaction. enabling telco operators to
guarantee upgrade completion take full advantage of 5G and
The problem with both of these
times for components below them IoT use cases without having
approaches is that while the
in the stack. to worry about data loss or
underlying data storage platform
This means you need to use a fraud.
remains consistent, the real-world
third geographic location and ramifications are simply ignored. For further information read
have an active-active-active You end up with either a negative our “Why Cross Data Center
deployment, so that even with a balance, which could have been Replication Matters in the Age
planned outage there’s still the leveraged into an offer to the user of 5G” whitepaper, here
security of two physical locations.

Enter 5G and Edge

Computing
Active-active-active XDCR seemed
to be the answer to telco’s woes
around latency, availability, and data
consistency, but then 5G and edge
computing came along to throw
a wrench in their plans. Both 5G
and edge place a huge emphasis
on extreme low latency because
they enable disruptive low-latency
use cases such as proactive fraud
prevention and real-time customer
management.
But this extreme low-latency
requirement creates significant
Diagram: Active(N) uses three (or more) data centers with high-availability
challenges, not only at the
clusters and enhanced data observability via Kubernetes to achieve active-active-
application level but also at the
active XDCR with application-level conflict resolution.
data platform level. In order to

45 inform.tmforum.org
 BENCHMARK

section 8:

MPNs, data-as-a-service & verticals

also promise revenue growth

In addition to security, IoT and cloud, other enterprise services hold the promise of new revenue for communications
service providers (CSPs). Some are services in emerging B2B segments like mobile private networks (MPNs) and data-
or data analytics-as-a-service, while others are new ICT services targeting specific verticals such as healthcare or media
and entertainment.

Finding a role in MPNs Read the report to learn more enterprises multiple options,
about MPNs: from managing their entire core
As noted, mobile operators plan
network to managing only certain
to provide enterprise 5G services
core network elements.
over their macrocellular networks
using network slicing and edge Large network equipment providers
computing, but it likely will be such as Ericsson, Nokia, Huawei
two to three years or more before and Samsung are winning close to
they have the capabilities to 60% of MPN deals, while CSPs are
deliver slicing end to end across chosen as the main contractor just
their access and core networks. In 19% of the time. So, while private
the meantime, a new market has networks may be a growth market,
emerged for MPNs where there is the current addressable portion of
Speaking at an industry conference
no existing LTE or 5G coverage, or the opportunity is small.
earlier this year, Verizon Chief
where coverage is insufficient or
Revenue Officer Sampath
unreliable. To boost their share, CSPs need to
Sowmyanarayan predicted that
demonstrate that they can add value
Research for our recent report, the MPN market could be worth
beyond what an enterprise could
Mobile private networks: between $7 billion and $8 billion
source from a systems integrator
Exploring the CSP opportunity, by 2025. But only a portion
working with network equipment
found that more than 150 MPNs of this is available to telecoms
providers or from a specialized
have already been announced operators because most MPNs are
niche service provider. For example,
globally. The sectors seeing the being built by traditional network
operators could offer different pricing
most activity are manufacturing equipment providers including
approaches and mechanisms such as
with automotive manufacturers, Ericsson, Huawei and Nokia or
MPN-as-a-service, which would allow
leading the way; transportation emerging technology vendors
the enterprise to pay for the network
hubs, principally airports and such as Parallel Wireless, Mavenir
with a monthly fee rather than an
ports; and energy and utilities and Athonet in partnership with
upfront cost. Telcos also have existing
including mines and electricity hyperscale cloud providers.
skills in managed services which they
companies. could extend to MPNs.
Telcos are competing with
professional services firms and
Some mobile operators are focusing
specialist MPN service providers
on the MPN opportunity. Three UK,
such as Edzcom and Geoverse
for example, recently won contracts
to lead the services contracts
for the large shipping port in
for MPNs. They are offering
Felixstowe and London’s Heathrow

46 inform.tmforum.org
section 8: MPNs, data-as-a-service & verticals also promise revenue growth

Airport. Indeed, the private network Travel and destination insights based ClayOPS and Hong Kong
model may be the answer to much such as for rail travel to help firm Velocity Business Solutions.
of the business around industrial railway operators model future Both are specialized providers of
IoT and fixed site deployments, so passenger behavior and plan data analytics services.
there is a large amount of overlap infrastructure investment
in the departmental structure being Another opportunity to use location
formulated within IoT-focused Other large CSPs are beginning data is emerging as a result of the
mobile operators. to offer similar services. They may Covid-19 pandemic. Australian
simply provide raw data, but often it’s telecoms group Telstra has launched
enhanced with a dashboard showing a service called Smart Spaces which
Making money from data powerful visualizations. For example, is designed to help workforces return
Mobile operators collect a wealth Vodafone Analytics is a platform that to the workplace more securely by
of data from their subscribers analyzes telecommunications data using data from video cameras and
who are constantly connected to based on users’ geolocation and sensors in buildings. For example, a
networks through smartphones behavior. Vodafone partners with company might be able to determine
and other devices. They can resell insight and visualization partners, Citi if social distancing is practical or
aggregated, anonymized data Logik and Carto to deliver data to being enforced in a space.
about customers and data-enabled business customers.
insights to third parties as a service. Along these lines, there is potentially
Singaporean telecoms group a much bigger market for CSPs to
Our research has not identified any SingTel is increasing its data sell data services to businesses to
CSPs that publish revenue for data- analytics capabilities as part of help them analyze their own data
as-a-service specifically. Based on its broader push into new ICT such as from IoT devices. Telcos can
the low visibility of such services and cloud-based services. In help companies use data to make
on operators’ websites and the use September it acquired Singapore- business decisions and improve
cases and customers they have operational efficiency.
disclosed, our impression is that it
is a growing business but one that A vertical view
is making only modest revenue
contributions. Traditionally CSPs have developed
enterprise product portfolios
Telefónica’s O2 Motion subsidiary Mobile operators horizontally so that they can be
in the UK is one of the most used across industries, and they
collect a wealth
prominent examples of data have developed services for
monetization. The company uses of data from their companies of a particular size.
anonymized data from millions of subscribers who Now they are also developing
individual smartphone users to are constantly services for specific verticals, which
provide insights, including: connected to is consistent with their use-case
driven approach to leveraging 5G
Audience insights for media networks through
and associated technologies.
agencies, advertisers and retailers smartphones and
We will be assessing CSPs’ vertical
Real-time travel insights for other devices.
approaches in our upcoming
transport operators They can resell report Enterprise verticals:
Movement insights aimed at aggregated, Placing the right bets which will
organizations making planning anonymized data be published in November. We
decisions based on how where about customers will explore how much progress
people are located and data-enabled operators have made in various
verticals and where they have
Micro-location insights insights to third genuinely developed new
for organizations seeking parties as a business as opposed to merely
to understand people’s
movements in a specific
service. making statements of intent to
target sectors.
location such as on a street or
in an apartment building.

47 inform.tmforum.org
section 8: MPNs, data-as-a-service & verticals also promise revenue growth

In our survey for this report, Best verticals for CSPs is more on B2C than B2B.
we asked CSP respondents telco revenue growth Even though TV is a consumer
which verticals present the best service, the monetization of TV
opportunities for generating
revenue growth for their
1 Healthcare services includes both B2C and
B2B revenues. As an example of
organizations. The graphic below B2B, many operators have sought
shows how they rank. Healthcare, 2 Media & entertainment to expand into the TV advertising
media and entertainment, and market, but success has been mixed.
Financial services
payments services lead, with about
half of respondents putting them in
3 (including payments) Swedish telecoms group Telia
their top three picks. acquired TV group Bonnier

Healthcare is already a hugely 4 Public sector Broadcasting in 2019, and

advertising now accounts for 6%
important market for telecoms of the company’s total revenues.
operators to deliver their existing
connectivity and communications
5 Energy & utilities But Verizon, which acquired the
AOL and Yahoo! online businesses
services. Operators such as
Telstra in Australia and TELUS in 6 Manufacturing
in 2017, sold them earlier this year.
Similarly, SingTel acquired mobile
Canada are leading the effort to advertising startup Amobee in 2012
grow professional and IT services
capabilities in the healthcare sector,
7 Education but then announced in May that
it was considering options for the
with the focus very much on B2B restructuring or sale of the business.
rather than consumer services. 8 Automotive
We’ll look more closely at the
Financial services and media Transportation
and entertainment sectors are 9 (including transport hubs)
relationship between CSPs and
enterprises in the next section.
interesting because the focus for
TM Forum, 2021

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SPONSORED FEATURE

BENCHMARK

How Intelligent Automation

is vital to the rollout of 5G
The Promise of 5G comes How can intelligent
with its challenges automation assist
What is intelligent
telecommunication service
The potential market-making automation?
opportunities that 5G represents providers with 5G?
Intelligent automation
to the telecoms industry are Deployment describes a collective set of
undeniable. The technological
Intelligent automation offers service combined technologies that
advances of 5G are primed
providers a new way to deploy 5G deliver a more advanced
to revolutionize new service
technologies and upgrade faster. digital worker. While digital
offerings for both consumers
Delivering a new digital architecture workers derived from robotic
and businesses while also
while maintaining QoS on the process automation (RPA)
boosting customer and business
existing services that are offered have some basic skills
experience for years to come.
is a challenge. There are physical used for basic automation,
With any revolution, however, there assets that need to be deployed, when given more advanced
are always challenges. The rollout as well as backend systems analytical and cognitive skills
of 5G is a massive undertaking and processes. With intelligent through artificial intelligence
because telecom companies automation, these challenges can (AI) and machine learning
have to offer new services, while be met by utilizing digital workers (ML), digital workers gain
maintaining the existing services. that will work alongside the human the ability to learn, read
There is new equipment that worker. Digital workers add value documents, and conduct
must be deployed, both in-house to the manual, repetitive tasks that rules-based thinking.
and on cellular towers. There is come with the deployment, while Intelligent automation
inventory that needs to be taken freeing human workers to focus enables the creation of an
to understand what existing on more value-added tasks. This enterprise-grade digital
equipment that needs to be will provide greater efficiency and workforce (made up of
replaced, and as well as the testing, agility to the growing deployment many digital workers) that
configuration and management of 5G. Intelligent automation can can deliver tasks every day
needed once this equipment is also reduce 5G deployment times, around the clock.
in place. When the 5G network upgrades, and maintenance by
is up and running, there also will achieving efficiency at scale for site-
be a large amount of data and surveys and audits. network, is also a challenge. And
an increased number of devices when 5G starts to scale with
that will have to attach to the more devices and services, the
network. Managing these devices, The Network Operations
challenge to manage the network
the subscriptions and data at scale Center of the Future
will be even bigger. Adding to all
will be a challenge unto itself. It is Managing 5G and other emerging of this is the pressure to maintain
intelligent automation that can help technologies such as IoT, as customer expectations for both
alleviate these challenges and bring well as other new services they the new and existing services.
the promise of 5G to fruition. will bring alongside the existing

49 inform.tmforum.org
SPONSORED FEATURE

In such a competitive business, workers can work alongside About the author:
the last thing telecoms need is a human workers to fill in any gaps
Jann Gorske
series of network outages. left by the different levels of
automation provided out of the Senior Practice Director,
To address this challenge, you
box. Intelligent automation also Telecommunications & Utilities,
needn’t look any further than
enables analytical and cognitive Blue Prism
the Network Operations Center
(NOC), specifically how the NOC analysis to resolve problems in the Jann is responsible for building
is run today and how it can be network. Once the right resolution and leading the growth within
transformed for the future. The is determined, digital workers America’s Telecommunication
NOC of today is technology then trigger how this resolution Practice. Jann is a strategic
focused. Technicians are is executed and implemented. sales leader with 23+ years
inundated with information, such This approach also works when of technology experience
as alarms, performance measures, introducing new services, as well delivering business outcomes to
network topology, and network creating a more efficient and agile accelerate revenue growth. He
and service transactional data. way of operating. has 12+ direct years in the call
But they lack an effective way 5G promises new services for center and telecommunication
to diagnose and resolve issues consumers and businesses industry experience with Lucent
quickly. In fact, analyzing and alike, and these new services Technologies, Concentrix and
identifying the problem is one will create a revenue boom for Avaya, where his thought
of most time-consuming tasks telecoms. With this comes greater leadership on business outcomes
performed in the NOC. expectations and significantly delivered year over year revenue
more data, user subscribers and growth. Jann is excited by the
In the interim, mean time to
bandwidth demand. It’s important opportunity to deliver digital
repair (MTTR) is affected,
for telecoms to prepare for this workers within the call center,
impacting network and service
scale. Intelligent automation is accelerate 5G implementation, and
availability. This has a direct
a critical technology that will transform customer experience.
effect on operational efficiency
and customer satisfaction enable efficiency and agility Linkedin: https://www.linkedin.
related to service levels. And in a when scaling 5G so telecoms can com/in/gorske24/
competitive business maintaining realize revenue and other benefits
the customer experience is critical. expected from 5G.

Equipment vendors offer out-of- To learn more about how

the-box automation to assist in intelligent automation can help
troubleshooting issues or gaining with the rollout of 5G, listen to
insight into the network. However, a recent TM forum Webinar on
most 5G networks are not built Reducing 5G deployment time
with equipment from a single by up to 80% using intelligent
vendor. Instead, networks are built automation
with multiple vendors, each with You can also read our white paper
different automation capabilities. on how to Transform the NOC to
This is where intelligent maximize 5G or visit Blue Prism’s
automation comes in. Digital Telecommunications Industry page.

50 inform.tmforum.org
 BENCHMARK

section 9:

changing enterprises’
perception of telcos

Understanding new value chains does not come naturally to communications service providers (CSPs). Many of them
struggle with the concept of partnering in B2B and B2B2X scenarios and are uncertain how to use technology in
new business models. But perhaps the biggest issue is that it is unclear whether enterprises view them as a potential
provider of services beyond connectivity. Many CSPs presume that if they build cloud and security services, enterprises
will buy them simply because they exist, but this may not be the case.

C
onsider mobile private enterprises, and they hope that
networks (MPNs). As a new wave of 5G IoT solutions
explained in the previous in verticals such as automotive,
section, they are a hotspot for agriculture and manufacturing
new service models mixed with CSPs are finding could help enterprises view
connectivity. Since the primary themselves thrust into telco brands as the de facto
contractors for the multi- a new competitive service provider for all wireless
technology deals are often network landscape where technology solutions.
equipment manufacturers, CSPs they must compete However, a large piece of
are finding themselves thrust into a
directly with their market research by Omdia and
new competitive landscape where
closest technology Bearingpoint shows that CSPs are
they must compete directly with now the lead partners in only 16%
their closest technology partners.
partners. This puts
CSPs in a difficult of enterprise 5G projects globally,
This puts CSPs in a difficult down from 21% in 2020. The decline
position because
position because they have an is also set against the context of a
they have an image
image problem based on their growth market with the number of
legacy. Technology providers
problem based on enterprise 5G projects doubling in
don’t suffer from this perception their legacy. the same time period, compounding
because they are constantly re- concerns among operators.
inventing themselves as technology But 5G rollout is still in its early
progresses and changes. The promise of 5G non-standalone phase. Many CSPs
This is leading some large CSPs Telcos are optimistic that the believe that once standalone 5G
to create new business units to roll out of 5G, using their newly is widely available the competitive
address opportunities such as acquired spectrum, will give them landscape will tip in favor of telcos.
IoT, the health sector and MPNs. an advantage over competitors In interviews for a new TM
The goals are to differentiate when it comes to connectivity Forum white paper called The
with a new brand but leverage services. They believe that the tech-driven telco (see page 70),
advantages like spectrum licenses. programmability of software- some CSP executives pointed to
defined 5G networks will enable connectivity as the cornerstone of
them to offer much more fundamental changes in business
attractive total solutions for diversification.

51 inform.tmforum.org
section 9: do enterprises want to do business with telcos?

“Connectivity is our core business,

and we believe it is more and CSPs must work together to go beyond connectivity
more vital as we go beyond
connectivity, as it is the fabric TM Forum members are team defines CaaS as “the
that will power new ecosystem collaborating to develop and delivery of connectivity/IP
partnerships and services for facilitate connectivity-as-a- presence solutions to meet the
consumers and businesses,” said service (CaaS), marketplace specific demands of different
Michaël Trabbia, Chief Technology platforms and zero-touch applications and users, defined
and Innovation Officer at Orange. partnering, which all share a programmatically.”
“We need to find solutions customer-centric approach to TM Forum’s work on software
to bring real resilience to the simplifying service delivery and marketplaces also tackles the
network; make it more agile to usage that relies on automation question of how to make service
enable delivery of these services.” to enable self-service. delivery to customers more
“As an industry we have not dynamic, automated and flexible,
Transformational steps made it simple to consume but from the wider angle of
CSPs are addressing their “image connectivity and value-added cross-platform partnerships.
problem” not with marketing, services such as security, Both marketplaces and CaaS will
but with demonstrative new guaranteed bandwidth and rely on CSPs’ ongoing efforts to
abilities. Indeed, many CSPs’ priority routing,” says Joann automate processes and service
transformational journeys are O’Brien, Vice President, 5G delivery. Offering CaaS involves
based on their ability to drive new Digital Ecosystems at TM Forum. being able to interpret their
business, and a set of common “And the traditional processes customers’ connectivity intent,
approaches is developing: for providing connectivity – using intent-based networking
covering ordering, fulfillment, and automation.
Evolve networks and IT orchestration and assurance
ecosystems utilizing cloud Read the white papers to learn
– will not continue to satisfy more about CaaS, marketplaces
native technologies consumer needs in a hyper- and zero-touch partnering:
Deploy AI-driven, autonomous connected world.”
operations to make zero-touch The goal of CaaS is to reduce
operations a reality the complexity of service
Push the deployment schedule management and improve
of standalone 5G quality of service, while
standardizing how customers
Focus on zero-touch
consume services. In a recent
partnering and adopt an
white paper, the collaboration
ecosystem mentality
Capitalize on the central
position of telcos within
CSPs that are taking these In the next section on consumer
society
steps now are beginning to services, we’ll look at telcos’ TV
Consider breaking out new stand out of the pack. But while and mobile money services.
subsidiaries with distinct their motivation in the past
brands to address different for adopting new technology
opportunities and business models may have
Remain as agile as possible been to achieve competitive
so that the new service advantage, cost cutting or
platforms can pivot quickly operational efficiency, the driver
and inexpensively to new now is preventing a long period of
opportunities declining revenue and capital.

52 inform.tmforum.org
SPONSORED FEATURE

BENCHMARK

Operators need full-stack

transformation software to
accelerate revenue growth from
innovative digital services
The telecom landscape is changing rapidly. Operators are no longer just competing with each other; they must
now also contend with a new wave of disruptive and innovative players in their market. 5G is a catalyst for
further market disruption and opens up many opportunities, including other industry verticals, for revenue from
value-added services. As revenues from consumer business flattens or declines, most operators are looking to
B2B and B2B2X opportunities for growth beyond connectivity.

The rollout of 5G networks has Cloud-native adoption in migrating CSP IT assets to

increased power at the edge the cloud because they foster
The BSS and OSS of the
and created partner-enabled continuous improvements for
future must have a cloud-
ecosystems to bring new solutions based on operational
native architecture for greater
services to market. Generating metrics and business data.
modularity and adaptability to
revenue from these new
provide unprecedented levels of
services will require cutting- Edge opportunities
flexibility and scale. Cloud-native
edge transformation software
architectures will allow operators Edge cloud is a critical component
to intelligently unify edge cloud
to leverage the multitenancy of digital transformation as
orchestration and monetization
capabilities of the cloud to build enterprises digitalize and
across multiple edge cloud
system-wide consistency for automate as many parts of their
domains and leverage partner-
processes, scale based on service business as possible. Businesses
centric revenue streams from
demands, minimize customization must adapt to the COVID-19 crisis
multiple verticals. Modernized
and significantly reduce the by accelerating digital customer
BSS/OSS and orchestration
duration and cost of development. engagement, accommodating
solutions will form the foundation
of operator transformation Another crucial requirement remote workers and supporting
software to meet the evolving for cloud-native vendors is the autonomous operations. The
demands of new networks, IT ability to work with operators in success of edge cloud services
approaches and business models. continuous joint development depends on the intelligent
and deployment with DevOps unification of edge cloud
and CI/CD methodologies. Agility orchestration and monetization
and flexibility are key elements across multiple edge cloud

53 inform.tmforum.org
SPONSORED FEATURE

domains and providers to meet meet Etisalat’s stringent needs for Cross-industry loyalty
stringent service requirements quality of experience. programs
for optimal performance. Digital
At first glance, this might not
OSS solutions need to support Multiple vertical businesses appear to be essential for digital
intelligent placement of multi-
5G has already demonstrated BSS, but loyalty programs will
access edge computing (MEC)
that potential revenue from become increasingly important
applications, including:
vertical-centric services is tied and expand beyond just service
Automated deployment, to building a profitable, practical adoption or voice, data and video
configuration and lifecycle and partner-ready business consumption. The disrupter in this
management. model to value, price and bill new space is Rakuten Mobile. Its parent
E2E management and services. BSS must therefore be company, Rakuten Group, Inc.,
assurance of the MEC service able to support multiple vertical operates in more than 70 sectors,
lifecycle across RAN, transport businesses and their various and its customer membership and
and core domains. models simultaneously. Platform loyalty program spans across all
providers like AWS, Google Ads or of them for everything from loans,
Continuous improvements
YouTube are successful because credit cards, travel and insurance
and seamless network
partners clearly understand to consumer goods.
modifications for E2E
how they can use them to earn
automation and optimization.
revenue. To compete, operators Partner management and
Digital BSS will be key for must offer a similarly transparent multiparty payments
enabling operators to leverage approach to allow their partners
the newfound power at the edge. Managing partners and related
to easily benefit from using their
The ability to support new low- services are now a ubiquitous part
services. Successful businesses
latency services is already being of virtually every operator’s service
must provide partners with simple
accelerated by 5G. The BSS layer ecosystem. Partners typically offer
and accessible services, and this
must therefore provide distributed a variety of value-added services
is even truer for businesses in
rating and charging and online and complement the existing
ecosystems.
charging across the edge. service offerings of the operator.
This means partner and multiparty
Edge sites create a wider range B2B2X business models payment management must be
of application and service embedded within the BSS. Partner-
Enabling multiple business models
options with capabilities for related service revenues will likely
requires a digital BSS with multi-
dynamic switching. For example, be paid in multiple ways (including
rate and multitenancy capabilities to
cloud-native network functions subscriptions, ad hoc payments and
support partners and other players
and infrastructure can enable pay-as-you-go models) and require
with rating and charging services
switching for a service or settlement among various parties.
and then quickly and accurately
application to reduce network
bill customers. This maximizes the For instance, an operator selling
traffic. Operators with dynamic
efficiency of the order-to-cash cycle security services through a partner
and flexible BSS software can
while still allowing for flexibility in on a subscription basis for $10 a
maximize the value of the edge
revenue sharing. month may need three-way revenue
and give their customers the best
quality of service. sharing between the security
New payment methods service provider, the operator and
Netcracker is helping Etisalat, another partner. It is also important
a leading telecommunications New payment methods have
to note that BSS will have to
operator in emerging markets, proliferated over time, giving
effectively manage multiple touch
leverage the power of the edge the end customer flexibility
points for certain services.
to bring innovative 5G services to in how they consume and
market. This includes automation pay for services. This trend
of 5G slicing within a multivendor will continue and extend BSS Customer engagement
and cloud-native environment capabilities beyond electronic Revenue management is important,
for 5G core and across the entire funds transfer (EFT) and credit but customer engagement is also
network. These functions also cards to encompass Apple Pay, crucial in innovating and competing
extend to the network edge to digital currencies and near- in the digital world. Many customers
enable new high-value 5G services field communications (NFC) for are digital natives, and they expect
and applications for MEC and contactless payments. a certain level of service from all of

54 inform.tmforum.org
SPONSORED FEATURE

their providers. This puts pressure Pricing and promotions Netcracker Digital OSS is a cloud-
on operators to enable multichannel native solution for automating
Offering dynamic pricing and
communications for customer and optimizing dynamic digital
promotions at the right time
contact, multichannel data services and 5G network slices,
increases customer satisfaction,
integration for customer visibility across multiple domains and cloud
loyalty and revenue. Operators
regardless of the end point and platforms. Netcracker Digital OSS
can take advantage of data
guaranteed delivery for services. uses a new operational model to
capacity monitoring, location-
remove manual tasks and drive
based offers, cross-sell/upsell
Intelligent customer hyper automation and agility across:
opportunities and a variety of
journeys other options to expand the Network edge, transport and
Applying AI to customer customer base and revenue. core domains.
journeys allows the operator to Cross-domain services.
constantly improve engagement Netcracker Digital Evolving business processes
with information on customer BSS/OSS and channels for open 5G
behavior, needs and preferences.
Netcracker’s cloud-native Digital networks with cloud-native
This information can include how,
BSS gives operators the ability functions.
when and why they use a channel
to reduce costs and unlock new Highly demanding edge cloud
or their preferred method of
revenue streams by monetizing applications.
communication.
cross-service offerings and
multipartner business models. The cloud-native capabilities of
Proactive care The Netcracker solution utilizes Netcracker Digital OSS enable
analytics for dynamic discounts, operators to precisely deploy
Intelligent proactive care with
promotions and customer functions to achieve specific goals.
advanced analytics and ML-driven
data intelligence addresses issues interactions across channels in real Operators need to adopt a next-
before they turn into serious time to drive a superior customer generation software architecture
problems. There is one simple rule experience. All Netcracker and business processes to go
when it comes to customers: if solutions are equipped with our beyond connectivity, provide the
your services are unsatisfactory, best-in-class security features next generation of enterprise
you will lose both the customer to protect customers, service, services and capitalize on
and the revenue. operations and network data. new revenue streams. In many

Netcracker Product & Services Portfolio

CUSTOMER ENGAGEMENT DIGITAL OSS

SDN/NFV
Channel Marketing Infrastructure
Management &
Management Management Management
Orchestration
Customer Hybrid Service
Journey Resource Management &
Management Management Orchestration

DIGITAL BSS CLOUD & ANALYTICS

Customer Sales Cloud Advanced

Management Management Platform Analytics

Integration &
Product Partner Revenue Partner
API
Management Management Management Ecosystem
Management

Business & End-to-End Support &

DevOps
Technology Program Managed
Enablement
Consulting Delivery Services
PROFESSIONAL
SERVICES

55 inform.tmforum.org
SPONSORED FEATURE

cases, this means scrapping the Netcracker offers an extensive

connectivity focus of current B2B range of solutions for digital
operations and investing in agile service providers, such as
operational strategies to seize the business service innovation, 5G
long-term benefits for growth in and digital service monetization,
future services. IT transformation and hybrid
network operations. The company
About Netcracker has over 250 customers across
more than 60 countries in North
Netcracker was founded in 1993 America, South America, Europe,
and has been a wholly-owned MEA and APAC. Netcracker
subsidiary of NEC Corporation remains focused on enabling
since 2008. Driven by its focus monetization of any service on
on R&D, Netcracker’s E2E any network and combining
product portfolio and related 5G-ready components for
professional services enable proactive customer engagement,
telecommunications and cable dynamic pricing and bundling,
service providers, utilities, partner-powered business models
financial services, logistics and and targeted AI-driven customer
other business service providers engagement.
to transform their mission-
critical business and operational Netcracker Digital BSS is the
processes. optimal choice for operators
looking for a converged platform
to optimize customer experience,
monetize innovative services
and provide a foundation for
business agility.

56 inform.tmforum.org
 BENCHMARK

section 10:

re-examining consumer
strategies

In the excitement about the potential for B2B services to spur revenue growth, it’s easy to forget that most of telcos’
revenue today comes from services provided to consumers. Among disruptor and prospector service providers (see
page 14), the percentage can be as high as 90%. But most innovation in consumer services is not happening within
telcos, rather it is coming from over-the-top (OTT) content providers.

F
or the last five to ten years at lowering costs for CSPs, they are
communications service not resulting in more revenue. In
providers (CSPs) have used fact, in countries with mature multi-
bundling of fixed, mobile and play markets such as Spain, where
broadband access with voice, Orange, Telefónica and Vodafone all
messaging and TV services as their offer multi-play services, revenues
While it’s clear that
multi-play strategies
primary strategy for addressing the have declined.
have been effective at
consumer market. This approach
Data from the Spanish market lowering costs for CSPs,
has been effective for companies
compiled by research firm Omdia they are not resulting in
with strong multi-play propositions more revenue. In fact, in
because it has reduced churn, demonstrates that over a four-
countries with mature
particularly among mobile users. year period from 2017 to 2021, the
multi-play markets
three Spanish operators recorded
Incumbent operators in markets such as Spain, where
a compound annual growth rate Orange, Telefónica and
including Belgium, Denmark and (CAGR) of -1.87%. The CAGR is
Spain, for example, have seen Vodafone all offer
even lower (-2.22%) when the multi-play services,
mobile churn for customers companies’ TV businesses are revenues have
subscribing to bundles fall into removed from the calculations. declined.
single-digit percentages, whereas
20% of standalone mobile users The lesson is that while multi-
churn every year. Furthermore, play is an effective strategy for
the cost of servicing bundled driving customer loyalty, it ceases Even 5G is unlikely to command
customers should logically fall to become a differentiator once a premium in the medium term.
over time as back-office systems competitors have responded with Evidence from across the world
and processes become aligned to similar offers. In addition, customers shows that the first operator to
multi-play service propositions. expect lower prices for buying launch 5G services can charge a
multiple services, which means premium for early adopters, but
Revenue in retrograde that multi-play can actually lead to the premium disappears as soon as
lower overall revenue for operators other operators enter the market.
However, while it’s clear that multi-
competing in a single country.
play strategies have been effective

57 inform.tmforum.org
section 10: re-examining consumer strategies

Strategies to help
In competitive markets it is Total TV revenue for telecoms worldwide 2018-2020
extremely difficult for a CSP to 70.0
raise prices successfully unless
60.0

Revenue (USD billions)

other operators follow suit. In most
markets, one or two operators
50.0
enjoy a combined market share
of 50% to 75% while a challenger 40.0
has a 10% to 15% share. As soon as 0.2%
30.0
one company increases prices, the 1.8% decline
growth
others target its customers. 20.0
However, CSPs are taking some 10.0
steps to improve the performance
of their multi-play businesses: 0.0
2018 2019 2020
Focus on convenience – it
 TM Forum, 2021
is easier to increase prices
for multi-play services
when migrating to another TV services revenue for selected CSPs 2018-2020
operator represents a huge (USD millions)
inconvenience. In markets 2020 TV %
2018 2019 2020
where number portability of total revenue

is allowed switching mobile

networks can be as simple as 589 590 546 2.0%
sending a text message to the
former operator. But switching
multi-play service providers
can be a difficult process 1,353 1,438 1,550 7.2%
because it involves a visit from
an engineer, which requires
an appointment. Potentially
274 231 210 1.8%
the subscriber will have to go
through a period with no home
broadband if the end of one
contract and the start of a new 105 117 126 0.8%
one cannot be synchronized.
They may also lose access to
some TV content because
pay-TV operators have different 360 314 244 1.7%
ownership rights.

U
 psell – getting customers
to buy more mobile data or 391 604 808 9.3%
increase broadband speeds can
lead to more revenue. However,
in many countries consumers
628 561 542 3.4%
have come to expect faster
speeds and bigger data
buckets as part of the renewal/
TM Forum, 2021
upgrade process or as a reward
for switching.

58 inform.tmforum.org
section 10: re-examining consumer strategies

Bundle content – bundling


third-party content and TV growth forecast to 2024
services or loyalty programs
can be effective strategies. 50
For example, mobile operators

Revenue (USD billions)

in Japan offer content,
45
magazines, video, emojis and
children’s games bundled with
$42bn
connectivity. They also offer
40
loyalty programs that provide
discounts on purchases of
third-party goods and services, 35 $34bn
and they offer the ability to pay
for goods and services using a
mobile phone. 30
2018 2019 2020 2021 2022 2023 2024

The trouble with TV Conservative decline Aggressive decline

CSPs’ investment in TV has been
TM Forum, 2021
another strong trend during
the past decade. However,
the structure of TV markets revenue from OTT TV services is shut down their TV businesses
varies enormously, and no forecast to grow from $36 billion – TV’s main value lies in helping
blueprint exists to address new to $107 billion. operators protect and grow their
opportunities. The very nature retail broadband business – but
of television has changed Our research shows that the it does mean that telcos will
dramatically over the last 10 value of TV varies hugely find it increasingly difficult to
years, leaving CSPs to consider from CSP to CSP and country justify competing for high-priced
and reconsider the business to country. Telcos that get content (see page 60).
cases and models that underpin more than 5% of total revenue
their strategies, which have from TV are mass-market TV
ranged from buying or investing broadcasters. They compete Pay-TV outlook
in existing pay-TV businesses to aggressively for premium content Our conservative estimate for
creating startups. rights (mainly sports) and in TV revenues shows some market
some cases are their country’s shrinkage as an extrapolation of
CSPs’ success in the TV business dominant pay-TV provider. the current trend post-pandemic.
has mirrored that of the sector as a Our aggressive forecast shows
CSPs that get only 1% to 2% of
whole. Over the last five years the a possible market future where
revenue from TV are followers
outlook for pay-TV has deteriorated the trend toward consumer
in their local TV markets. Their
as a direct result of the growth of adoption of OTT video-on-demand
customers may use them to provide
online video platforms, and this is services, which grew during the
terrestrial TV services (which they
reflected in our revenue estimates pandemic lockdowns, continues
do not make money from), but they
for TV services. with customers cancelling pay-TV
also provide additional content and
may have deals with OTT providers services provided by CSPs.
While our research looks only
at CSPs providing TV services, to resell their services.
Omdia has evaluated the entire
Swedish telco Telia is an example
pay-TV market. The resesarch
of a mainstream national
firm forecast in 2017 that the
broadcaster that generates
total pay-TV market would grow
significant revenue from Over the last five years
from $203 billion in 2015 to $246 the outlook for pay-
advertising. However, it is clear
billion in 2022 but three years TV has deteriorated as
from the data that for the rest
later downgraded its projections a direct result of the
of the telcos, TV is no longer a
significantly to just $195 billion in growth of online
significant growth business. This
2022 and flat revenue from 2017 video platforms.
does not mean that CSPs will
to 2024. During the same period,

59 inform.tmforum.org
section 10: re-examining consumer strategies

CSPs partner for content, but revenue is elusive

Many telcos have forged demonstrates the relatively small The only ways for telcos to
relationships with OTT content amount of revenue they bring significantly boost revenue from
providers like Netflix, but they to the business (see below). reselling OTT services are to resell
have not approached these Platforms like Netflix or Apple TV multiple services – for example,
relationships in the same way that don’t need to offer big margins to Netflix, Apple TV and Disney Plus
a classic retailer would build a telcos because they can grow their – or partner with content providers
viable, standalone business. Rather businesses without partnerships. that are prepared to offer higher
CSPs are using the partnerships From a customer’s perspective, profit margins. For example, Disney
to augment their overall TV or however, the benefits of subscribing offered higher margins when the
broadband value proposition. through a CSP or cable company company began rolling out its
rather than directly are the video platform in 2019.
A quick analysis of the commercial convenience of a single bill and
models behind partnerships integration of the service into an
with OTT content providers existing electronic program guide.

What’s a content deal worth?

in a country of 30 million
broadband subscribers

X $30 $300 X $10 per

OTT
per month month
(multi-play)

has 10 million
customers
= million has 30 million
customers
= $300 million

+
OTT
x $10 per month
= 15% profit margin
or... $1.50/subscriber
TelcoX signs deal with OTT provider X
to resell the content service

OTT
30 million customers
@ revenue share of .5% of
$1.5 million total broadband revenue
secures 1 million OTT provider X
customers over the next 2 years or...

TM Forum, 2021

60 inform.tmforum.org
section 10: re-examining consumer strategies

Mobile payments Mobile payment services revenue growth

For many CSPs in Sub-Saharan
for selected CSPs 2018-2020 (USD millions)
Africa and other developing 2020 mobile payments
2018 2019 2020
regions where conventional % of total revenue

banking is out of reach for

many people, mobile financial (Africa) 243 318 404 9.9%
services are an important and
growing line of business. The
543 702 893 7.6%
outstanding performer in this
sector is Safaricom, the largest
mobile operator in Kenya in which
184 459 536 7.0%
Vodafone has a minority stake.
Safaricom generates a third of its
revenue from the M-Pesa service, (Middle East
336 448 560 8.8%
& Africa)
although revenue declined in
2020 after the operator waived
fees during a period of lockdown 199 202 149 2.9%
resulting from the Covid-19
pandemic.
252 349 402 1.0%
The four operator groups that
dominate the African telecoms
market – Airtel, MTN, Orange (South Africa)
69 114 138 2.9%
and Vodacom, which is majority
owned by Vodafone – all operate
successful mobile financial 731 827 810 33.0%
services businesses. Airtel Africa,
Orange and MTN generated 10%, TM Forum, 2021
9% and 8% of their revenues
respectively from mobile financial
services in the region. Hazy smart-home vision services that require connectivity
– typically Bluetooth and/or Wi-Fi
Usage data for mobile payment CSPs’ visions for building lines of
– and whose point of convergence
services demonstrates that they business for smart home services
is usually a smartphone. For this
are well-established businesses. have disappeared from corporate
reason, home Wi-Fi connectivity
Orange has more than 55 million strategy presentations over the
is growing massively in value.
Orange Money customers last couple years. This is not
According to research from
representing 38% of its subscriber because telcos have lost out to
Deloitte, the average US home has
base in the region (although less competitors, but rather because
25 connected devices today, up
than half are active users). ARPU consumers haven’t fully bought
from 11 in 2019.
is increasing among active users into the smart home idea.
and currently stands at €1.90 Telcos can monetize this surge
In the US, AT&T and Comcast
($2.25) per month. in demand either by selling
have traditional home security
customers faster home broadband
Airtel has 23 million active users businesses, but they remain
connections, guaranteed Wi-Fi
and an ARPU of $1.80, while MTN standalone businesses rather
connectivity throughout their
has 47 million active users of its than a route into the smart
homes, or second lines for back-
MoMo mobile payments service. home. In addition, many CSPs are
up/resiliency or home working.
Safaricom has 28 million M-Pesa experimenting with selling home
users in Kenya where it has just IoT gadgets such as Google Nest, In the next section, we’ll discuss the
over 30 million mobile customers. however success has been limited. outlook for connectivity services
and whether they will continue to
Still, homes are getting smarter as
offer opportunities for growth.
people acquire new devices and

61 inform.tmforum.org
 BENCHMARK

section 11:

is connectivity dying –
or isn’t it?
An important discussion in the telecoms industry centers around whether the connectivity business can remain
profitable for communications service providers (CSPs). Even telco executives themselves sometimes send mixed
messages, complaining in one breath that connectivity has become a commodity while in the next lauding the potential
for 5G network slicing and mobile private networks (MPNs) – both of which are connectivity services.

T
here is no question that In recent years, investors to provide secure, reliable
CSPs’ traditional connectivity have rewarded telcos that services. Telcos are responding
business is under pressure. have invested aggressively in by investing in network security
But is it really dying? deploying fiber. For example, and capabilities such as
pure fiber companies have network slicing.
EBITDA (earnings before interest, performed better than
taxes, depreciation and amortization) CSPs with large mobile In the survey conducted for this
margins for CSPs’ core connectivity businesses. report, we asked CSP respondents
businesses globally are between 30% how they expect their companies
and 40%. That’s not bad considering  he pandemic has
T to derive new revenues from 5G
that EBITDA margins for the services demonstrated the value of and what the drivers are for QoS
provided by IT services firms – the reliable, high-speed broadband and network slicing. We listed four
market many CSPs want to enter – connectivity and the need, potential ways as shown in the
are closer to 20%. from societal and economic graphic below, and all were strongly
perspectives, to provide endorsed by respondents. Analysis
Optimism grows affordable broadband services of each follows.
to the entire global population.
Most telcos are growing more
bullish about connectivity for three  nterprises are demanding
E
Selling more connectivity
primary reasons: more control over their The main growth in connectivity will
connectivity and want CSPs come from IoT services. While many

Drivers for QoS & network slicing

Sell additional services
62.9% 31.1% 6.1%
on top of connectivity

Sell more connectivity 45.0% 37.2% 17.8%

Attract developers to use our

connectivity to create new 44.3% 42.0% 13.7%
applications and services
Sell higher-priced/
40.0% 45.6% 14.4%
more valuable connectivity

High priority Medium priority Low priority

TM Forum, 2021

62 inform.tmforum.org
section 11: is connectivity dying – or isn’t it?

predictions about the number of or other quality-of-service (QoS)

connected devices have proven to metrics. CSPs will need to decide
be wildly optimistic, connections whether to offer these benefits
continue to grow steadily. IoT to large market segments – for
research firm Transforma Insights example, cloud games – or
reports that the top 35 operators While many predictions individual companies.
in the world had 1.55 billion IoT about the number of
connected devices have Value-based pricing is a concept
connections at the end of June
proven to be wildly that operators have been toying
2021, a 6% rise in the quarter.
optimistic, connections with for several years and one
However, average revenue per continue to grow they may revisit with 5G. The
user (ARPU) for IoT connectivity steadily. IoT research basic principle is that prices are
firm Transforma Insights
is falling rapidly as CSPs deploy set based on the value that a
reports that the top 35
new low-power wireless access product or service delivers to
operators in the world
networks including LTE-M, NB-IoT a customer. For example, the
had 1.55 billion IoT
and LoRa. It is not clear whether connections at the end provider of IoT products or
the growth in connections will of June 2021, a 6% rise services might be paid based on
outpace the decline in ARPU. For in the quarter. the savings that the enterprise
example, there will be some new incurs from deploying a solution.
IoT applications enabled by 5G
that were not viable using LTE. There may also be potential for
Video will be the main driver, concerns about the reliability of operators to better monetize
particularly in combination with the main broadband connection connectivity if they can give
edge computing, enabling the or poor Wi-Fi coverage in specific customers the ability to control,
processing of data close to the rooms or locations. Integrated manage and customize their
point of consumption. ethernet/5G routers to support connections, which is one of the
this connectivity are starting to promises of network slicing. For
Beyond IoT there is still some appear on the market. example, a media company could
growth in home broadband in order bandwidth on demand to
most countries, particularly fiber cover a special event or
Higher-priced connectivity
broadband. Growth is strongest in breaking news.
emerging markets where, in the last It is unclear whether CSPs will
five years, many consumer-focused be able to sustain a premium
Attracting developers
telcos have built good businesses for 5G. The first two years of 5G
delivering fiber connectivity to launches have demonstrated the CSPs have long aspired to build
high-end residential customers and same pricing trends as for LTE. In developer ecosystems, but so
the B2B market. most markets the first operator far they have not been very
to launch 5G charges a premium successful. In the early 2010s,
5G could drive some connectivity over the cost of LTE, but as soon AT&T had the most advanced
growth at least initially. One of the as second and third operators developer program of any telco,
main benefits of 5G is that it can enter the market, the premium but the only service that gained
support use cases for broadband disappears. The only exceptions any real traction with developers
connectivity that weren’t feasible are when operators offer bigger was SMS. AT&T’s developer
using fixed landline connections, data buckets or unlimited data for program has since fizzled out.
such as when the application 5G, or when operators bundle 5G
is in a location where a fixed CSPs could breathe new life
with other services or devices to
connection is not possible or into developer programs if
justify charging a premium.
the connection needed is only they are able to offer access to
temporary. Examples include As operators deploy new 5G different levels or categories of
holiday rental properties, seasonal connectivity capabilities like edge connectivity – for example, access
businesses or festivals. computing and network slicing, to edge-based connectivity and
they may be able to introduce a applications that require low
Another 5G use case is providing sustainable premium using service latency. From a monetization
secondary connections into level agreements (SLAs), which perspective, operators would
residences or small businesses could be based on variables such derive benefits by charging
such as when a customer has as latency, throughput, location developers for access to different
network APIs.

63 inform.tmforum.org
section 11: is connectivity dying – or isn’t it?

Beyond connectivity different applications. They are neutral, third-party marketplaces

also evaluating this model for so that they can “own” the
Even if revenues from existing
procuring technology. customer.
connectivity services are flat or if
new connectivity services fail to Recent research for our report Learn more about marketplaces:
generate significant profits, telcos Exploring marketplaces for
may be able to sell other services software and services finds that
alongside or on top. As discussed while CSPs view as marketplaces
throughout the report, demand a good way to sell their services,
for services such as security, IoT, the don’t agree on who should
cloud, private networks and edge own and operate the marketplace.
computing is growing. As a result, For example, Amazon Web
connectivity is becoming a vital, Services already sells connectivity
enabling capability rather than a from many different CSPs in In the next section, we offer
separate service, and the way in its marketplace, but when we guidance to help CSPs realize
which it is sold and delivered is surveyed operators about their opportunities to grow revenue.
starting to change. preferences, respondents were
decidedly against the idea of a
Many CSPs are considering the
hyperscale platform provider
role for platform business models
owning the marketplace. Most
and marketplaces in selling
CSP executives are much keener
connectivity as a standalone
on telcos setting up their own
product or integrated within
marketplaces or participating in

What is a marketplace?
CSP group
internal Other
portal As CSP-operated, digital self-service portal for buying and
Hyperscale bundling service from a single CSP and its ecosystem partners;
CSP B2B2X portal
platform 5% CSP owns the customer
business 6% A place where CSPs can procure ODA-compliant components for
3.5% their software infrastructure
A digital self-service portal hosted by a neutral, third-party
marketplace provider through which multiple CSPs and ecosystem
40% partners can offer connectivity, comms-related services, apps,
devices and content; no single CSP or partner owns the customer
CSPs
A digital self-service portal hosted by a hyperscale cloud provider
through which multiple CSPs and ecosystem partners can offer
connectivity, comms-related services, apps, devices and content;
35%
platform provider owns the customer
A hub where operators that are part of a large telecoms group
can provide services to each other
Neutral, third-party 10.5% ODA software
Other
platform business marketplace

TM Forum, 2021

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 BENCHMARK

section 12:

how to realize growth

opportunities

The last 20 years have demonstrated how difficult it is for communications service providers (CSPs) to break free of
their legacy products and services and build new lines of business. Many multi-year digital transformation initiatives
designed to create a foundation for growth have stalled or lost momentum. To give prescriptive advice that will help
telcos realize opportunities for growth, it is necessary to understand the challenges they are facing.

W
e asked survey main challenges to achieving growth in
respondents to rank CSPs’ new lines of business
challenges to delivering
revenue growth in new lines of

97% 94% 92%

business, and all seven issues we
listed were deemed a moderate
or serious challenge by at least
85% of respondents. The biggest
is figuring out how to deliver
growth profitably.

As discussed in Section 4, most

new opportunities for CSPs lie
in professional and IT services, delivering revenue developing the culture ability to
but the EBITDA (earnings before growth profitably & agility necessary scale
to experiment
interest, taxes, depreciation and
amortization) margin for these
services in many cases is below 10%.
So, the ability to drive scale is the
key challenge to delivering growth 91% 90% 87% 85%
profitably in services businesses.

changing forging availability persuading senior

customers’ successful of software management to take
perceptions about partnerships & cloud skills a long-term view of
our skills & creating new lines
capabilities of business

TM Forum, 2021

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section 12: how to realize growth opportunities

Helping CSPs
scale their services
The recommendations we offer in this section are aimed at helping
CSPs scale their services and overcome the other challenges
highlighted in the survey.
We have divided them into four categories, but in practice they overlap:

Take a more
Focus on strategy,
 Get closer to Make technology agile approach
business models
customers and a company-wide to procurement,
and organizational
partners priority cost allocation and
alignment
business KPIs

Much of our recent research has explored potential

business models for CSPs to move beyond
connectivity. In the survey for this report, we asked
which business models CSPs favor, and they have a
clear preference for offering end-to-end solutions.
But in practice, even Tier 1 CSPs that invest heavily
in capabilities to provide full-service solutions will
be unable to deliver them to their entire customer
Focus on strategy, base. Business models necessarily will vary based
on the operator’s expertise in a given market, how
business models enterprises want to engage with them and the
partnerships they create.
& organizational Platform business models are the least attractive

alignment option, according to respondents, although this

may be because CSPs do not understand clearly
how they would generate revenue from a platform
CSPs should be prepared to play different roles,
business. There is no single business model for
from wholesaler and enabler to platform provider
platform businesses – the platform owner can make
and end-to-end solution provider, and they
money by taking a small percentage of revenue
should be prepared to partner to deliver services
from each transaction, charging the producer, the
beyond connectivity.
consumer or both. But from a CSP’s perspective,
it is often not immediately obvious who the
producers are.

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section 12: how to realize growth opportunities

Business models that will enable revenue growth

Provider of 65.4% 26.4% 8.1%

end-to-end services

Provider of connectivity
(including CaaS, customized 59.1% 31.4% 9.5%
connectivity and network slicing)

Developer of (or participant

38.5% 44.5% 17.0%
in) platform business models
Significant opportunity Moderate opportunity Minor opportunity
TM Forum, 2021

CSPs should focus on building horizontal will be unable to leverage the benefits of being part
capabilities that can be exposed vertically, rather of a larger organization, such as ability to cross-sell
than developing vertical-specific solutions that and upsell and investment in new technologies.
cannot scale. CSPs should determine which organizational
To serve vertical markets, CSPs will need model is best for new lines of business: running
to understand the business challenges and them as separate divisions or as part of an
opportunities that companies operating in the existing one.
vertical face. But this does not necessarily mean that Over the past decade, CSPs have gone back and
they need to develop products and services that are forth between the two models, but recently the trend
specific to a vertical. Rather CSPs should seek to has been towards separation. As noted in Section
adapt horizontal solutions for different verticals in 8, Telefónica launched Telefónica Tech as a separate
order to build scale and replicability. division responsible for the telco’s IoT, cloud and
Classic telecoms services such as voice, broadband, security businesses. Similarly, BT has created BT Digital.
unified communications and collaboration tools are However, its scope is different from Telefónica Tech’s
all products that companies in many verticals can use, in that part of the division’s role is to drive digital
but professional services tailored to the needs of a transformation across all of BT.
company in a specific vertical are not. Given that many Many large CSPs are also setting up their own digital
of the new opportunities in segments such as cloud, brands for the consumer market – for example, Verizon
IoT and security include significant requirements for (Visible), Videotron (Fizz), SingTel (Gomo), Vodafone
professional services with integration, CSPs may need (Voxi) and Ooredoo (Ana). Essentially, they are in-
to focus on a small number of verticals. house MVNOs (mobile virtual network operators), and
CSPs should be prepared to acquire companies most have taken a greenfield approach to developing
to serve a particular sector or market segment support systems.
and be clear about whether the company will be In the Asia-Pacific region, SingTel has moved its NCS
integrated into the core business and if so, how. division – an ICT services company with a focus on
Mergers and acquisitions help CSPs expand selling services to the public sector – out of its enterprise
into new markets by providing instant market division to give it greater autonomy and management
knowledge, established brands and specialist focus. And South Korean telco SK Telecom has gone
skills. M&A activity is accelerating as telcos seek to a step further by splitting into two companies – the
offer new ICT services such as cloud, security and existing telecoms business and a new company called
IoT. Indeed, the CSPs that are targeting security SK Square which focuses on semiconductors and new
services most aggressively have all based their ICT businesses including security.
strategies on significant acquisitions (see page 33). These business units face the same challenges that
Deciding how to integrate these businesses into acquired companies do, namely losing the ability
the existing telecoms business can be difficult. If an to cross-sell and upsell and the possibility that the
acquisition is fully integrated, the group may lose unit’s requirements won’t be factored into future
its entrepreneurial drive and ability to innovate. But CapEx projects.
if it is allowed to remain fully independent, the team

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section 12: how to realize growth opportunities

Get closer to customers

& partners
CSPs need to understand the business challenges and opportunities
enterprises face and how to address them using both traditional and
new services.
CSPs are trying to transition into companies that embed connectivity into
solutions for enterprises, but doing this requires business and technology
know-how. Professional services firms such as Accenture and Infosys have
teams of skilled consultants who understand their B2B customers’ businesses
and goals, unlike telcos whose expertise is all around connectivity.
Telcos must acquire the necessary skills, and indeed, many are recruiting
large teams of consultants and making acquisitions to bring in talent.
They will also need to invest in new BSS capabilities to better serve their
customers and deliver more real-time, data-driven insights.
CSPs should make partnering a cornerstone of their strategies and treat
partners like customers.
Partnerships among CSPs, cloud providers, equipment manufacturers and
software specialists are necessary to deliver many emerging enterprise use
cases, and businesses expect to order end-to-end solutions through a self-
service platform. All the complexity must sit behind the interface with the
customer, which requires technical integration of services and commercial
models with revenue sharing for all partners.
CSPs have struggled in the past to partner effectively, partly because
their core business model is to deliver end-to-end services without help
from other companies, but also because teams responsible for enterprise
business are under constant pressure to deliver financial wins.
To partner effectively, telcos need to start thinking of partners as
customers. This includes hyperscale platform providers. For example,
partners need access to real-time data about how their services are being
used, and they need to be able to integrate their products with telecoms
services easily.
While in some cases partnerships with cloud providers are simple buyer-
seller relationships, often a shared risk/shared reward approach is needed,
where the parties share costs and revenue. This is the case with edge
services, for example.
As discussed in Section 7, respondents to our survey indicated willingness
to participate in several commercial models with hyperscale cloud
providers. However, our conversations with CSPs indicate more caution
because of the uncertainty around new services. Multi-access edge
computing is a brand-new market, for example, and telcos risk striking
deals that wildly over- or under-estimate the size of the market.

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section 12: how to realize growth opportunities

Make technology a
company-wide priority
CSPs’ IT teams need business knowledge, and business teams need
knowledge about technology. This may require hiring new talent or
training employees.
Today, telco leadership often views IT operations as strictly a cost
center, yet operations teams are in the best position to understand how
technology can generate new revenue. Consider network-as-a-service
(NaaS), which operations teams are using to simplify and accelerate the
integration of new technologies and/or suppliers. NaaS could also open a
new line of business for telecoms operators to sell APIs to developers or
enterprises, who can use them to create new services.
Furthermore, technology and business leaders often come into conflict
when decisions are made about the deployment of new support systems
and the extent to which they must support legacy products and services.
We have spoken to many CIOs who lament the fact that new systems are
too focused on maintaining legacy rather than creating new services.

CSPs should strive to become software-driven organizations.

Many large CSPs are intent on becoming “techcos” (see page 70). They
are aggressively recruiting digital skills in software, cloud and analytics,
and they are developing some of their own software, mainly to plug gaps
between suppliers’ solutions.
But becoming a techco may not be the right option for smaller telcos,
particularly in emerging markets where there is a lack of digital skills.
Large operator groups can spread investment in digital capabilities across
the whole organization. Vodafone Group, for example, has centralized
its technology organization and no longer supports separate groups for
each operating company. Small CSPs will need to decide whether the
“openness” espoused by their vendors truly enables creation of new
products and services with the necessary agility and responsiveness to
customers’ needs.

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section 12: how to realize growth opportunities

Finding new revenue as a techco

Most large CSPs believe they must transition from  orea Telecom has acquired global wholesale and
K
telco to techco in order to tap new revenue beyond connectivity provider Epsilon, which provides cloud
connectivity. But what does it mean to be a techco? connectivity, ethernet, remote peering, access, SD-
One of the biggest distinctions between telcos and WAN, colocation and voice service from hubs in 41
techcos like Amazon, Google and Microsoft is that cities worldwide.
techcos serve global markets, while telcos are mostly A new white paper from TM Forum’s Collaboration
limited to serving customers in countries or regions Community urges telcos to use the Open Digital
where they have a network presence. In addition, Architecture (ODA) to become techcos. The ODA, part
cloud operators’ ability to innovate and scale their of the Open Digital Framework (see page 75), defines
services far outpaces telcos’ because they are standardized, interoperable software components,
completely software-based. which are independently deployable pieces of software
Even the most ambitious CSPs are a long way from typically built out of one or more microservices. These
becoming techcos with global product capabilities, but components expose business services through Open
some telcos are beginning to resell or franchise their APIs, which are built on a common data model.
tech capabilities to other CSPs. This could be viewed as This approach enables CSPs to evolve to a fully
a simple wholesale model, but it’s worth considering it automated, cloud native operations environment
in a broader context as an attempt to build global tech that relies on analytics and AI to deliver zero-touch
businesses outside network-defined markets. Examples services. But widespread agreement, collaboration
include: and contribution among many CSPs and vendors is
 elefónica Tech is partnering with Telekom Malaysia
T necessary to advance it.
to help it build a cybersecurity business in its home “The telecoms industry is too fragmented for individual
market. telcos to effect the necessary changes alone,” the white
 s part of Vodafone Group’s global partner
A paper explains. “CSPs must work together, forming
program, the company licenses other telcos to robust partnerships, coordinating efforts and leveraging
resell its products and services. For example, in 2019 standards, so that the industry can act as a single force
Vodafone entered into a marketing and technology to accelerate change and deliver new digital services.”
partnership with Oman’s new mobile operator,
Read the white paper:
Oman Future Telecommunications (now branded
Vodafone Oman).
 S telco Verizon acquired video conferencing
U
platform BlueJeans in 2020. Shortly after the
acquisition was announced, Verizon struck a deal
with Indian telecoms group Bharti Airtel, allowing
the company to sell the service under the Airtel
BlueJeans brand.
 apanese mobile operator Rakuten Mobile has
J
established a business called Rakuten Symphony
to sell its network and IT solutions and capabilities
to other CSPs. As part of this process Rakuten
has acquired open-vRAN vendor Altiostar. This
follows the acquisition of OSS vendor Innoeye in
2020. In August Rakuten Symphony entered into a
partnership with Germany-based United Internet to
build and operate the network for its new LTE/5G
mobile operator 1&1.

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section 12: how to realize growth opportunities

Take a more agile approach

towards procurement, cost
allocation & KPIs
CSPs should overhaul the process for procuring technology to facilitate
better partnering with small and large vendors.
Very few large CSPs partner with startups or small technology vendors;
most work only with very large vendor partners. This is partly because
small suppliers can’t afford to participate in slow, costly procurement
processes. And for CSPs, working with smaller vendors can be risky
because there is a higher likelihood that they will go out of business.
However, by failing to address this issue CSPs are cutting themselves off
from a major source of innovation. CSPs should move to a procurement
model that relies less on lengthy RFPs (requests for proposal) and instead
adopt a proof-of-concept model that invites suppliers of all sizes to
demonstrate their capabilities in a real-world environment.
Even if CSPs are unprepared or unable to change their approaches to
procurement (perhaps because of corporate governance requirements),
they should at least seek to narrow the gaps and align teams better. For
example, CSPs could add technology specialists to procurement teams
and people with financial skills to technology teams.

CSPs should take a more enlightened approach to technology spending

and move toward an asset-light business model.
Finally, CSPs should reconsider the CapEx model for procuring technology.
As they increase spending on public cloud services, cost allocation will
naturally shift from CapEx to OpEx.
Some operators are uncomfortable with this transition because it
represents a change from how they have made large technology
purchases in the past. But it is part of a gradual transition to an asset-
light business model used by MVNOs (mobile virtual network operators).
These service providers do not own their network and procure many other
functions “as a service”.
CSPs should adopt this model when it comes to new lines of business
and new investments in areas including mobile private networks and edge
computing, rather than building out networks first and then seeking to sell
access to them later.

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SPONSORED FEATURE

BENCHMARK

Network Lifecycle Automation:

Infovista’s solution for achieving
increased automation with end-to-end
solutions, from CAPEX investment to
service monetization.

An overview of Network Network Lifecycle Automation deployment and monetization of

Lifecycle Automation uniquely encompasses automation advanced connectivity services
concepts such as closed-loop in both consumer and enterprise
Network Lifecycle Automation
automation, zero-touch operations, markets and verticals. Advanced
(NLA) is the productization and
and AIOps within a common connectivity services have
integration of telecommunications
framework, by cloudifying typically specific requirements on network
network operations capabilities
siloed capabilities that contribute performance, across latency, speed
across planning, deploying, testing,
to the four phases of the network and connection density (gaming,
operation and monetization into
lifecycle: Planning & Design; connected cars and aviation are
a single cloud-native platform,
Testing & Deployment; Operations three examples). Without the
delivering a step-change in
& Support; and Monetization & automation of cross-lifecycle
automation levels for existing
Reporting. These capabilities processes, delivering on these
processes, and enabling new
share a common platform, which requirements is not feasible at
automated ‘cross-lifecycle’
contains essential services such scale, and operations is prohibitively
processes that span multiple
as orchestration engines, AI/ML expensive. In many cases, delivering
stages in the network lifecycle.
tools, algorithms, models, APIs, KPIs on strict SLA guarantees is to all
These cross-lifecycle processes are
and user interface tools, within a intents and purposes impossible
significantly faster (in some cases
microservices architecture. without NLA.
real-time); more proactive (with the
use of predictive advanced Machine
Learning and Artificial Intelligence Why Network Lifecycle Use Cases for Network
– ML/AI – capabilities); and less Automation is Essential to Lifecycle Automation
manually intensive (in some cases, Revenue Growth One particular use case that
requiring zero manual intervention, Network Lifecycle Automation encapsulates the value of NLA is
with closed-loop automation). is a pre-requisite for the Smart CAPEX, which combines

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SPONSORED FEATURE

operations data (customer Other examples of NLA use cases with one or more of four distinct
experience, network and service include cross-domain RAN and categories of automation spanning
performance), behavioral data core troubleshooting (integrating multiple lifecycle phases:
and active testing data, alongside capabilities from RAN and core • Data Management Automation:
planning data (coverage, network assurance applications); 5G Enriching the intelligence and
throughput and geodata) to slice lifecycle assurance (integrating insight driving a given process
accurately predict the impact of SLA management, planning and by automating the flow of data
network investment decisions testing application capabilities); and across lifecycle phases, data
on revenue and ultimately RoI, “360 service assurance” (integrating sources and network domains.
rather than simply coverage service traffic monitoring and
and throughput. This is today management with network resource • Analysis Automation:
more important than ever for assurance application capabilities). Optimizing network
delivering sustainable profitability: performance under constantly
monetizing high value services changing environmental
Infovista’s approach conditions, with continuously
increasingly relies on networks to Network Lifecycle
with the resource capacity to improving ML/AI-driven open- or
Automation closed-loop orchestration.
deliver on the growing and
diversifying expectations of Infovista is the world’s first
• Workflow Automation:
customers (alluded to with the independent software vendor
Delivering faster business
above examples of advanced providing a carrier-grade,
processes by replacing an
connectivity services). Alongside cloud-native Network Lifecycle
increasing subset of manual
this, the pressure to densify and Automation platform designed
activities with automated
expand capacity in general, driven for the 5G era. Its end-to-end
workflows
by 5G, is not going to go away. solutions enable not only different
teams within operations, but also • Decision Automation:
CSPs must adopt more precise
planning, deployment, operations Optimizing business outcomes
network planning and manage
and monetization to work with a such as SLA adherence and
shorter investment cycles to
single, interoperable platform of QoE, through closed-loop
handle rapidly changing and
applications. automation of decisions that
unpredictable future demand
involve complex scenarios,
characteristics. All other things Infovista’s NLA portfolio is a cloud-
trade-offs and prioritizations
being equal, more targeted native framework of applications
network investment with Smart that function together to enable Infovista’s NLA portfolio is
CAPEX can deliver up to 10% business automation levels that deployable in stages, with each
reduction in incremental CAPEX would not be possible with separate providing ever-greater automation
with no compromise on service system silos. It supports use cases, levels, providing the cost savings
quality. such as those described earlier, and monetization opportunities

73 inform.tmforum.org
SPONSORED FEATURE

such that your solution investment • Customer-driven deployment: - S

 cale out and maximize
pays for itself at each step. - D
 eliver more reliable network revenues from diverse
performance with lower 5G-enabled differentiated
The benefits of Infovista’s costs, by automating the services across verticals by
NLA offering: triggering of network changes orchestrating multiple network
in response to predicted slices optimized for combined
Infovista’s NLA offering enables SLA performance
CSPs to focus on the customer: customer experience issues
- Improve predictive accuracy • Customer-driven monetization
• Customer-driven planning:
of customer experience, by - A
 utomate SLA and QoE
- O
 ptimize infrastructure combining active testing, reporting, with billing and
investments to deliver the network traffic and resource charging integration for
optimum customer experience performance insights, for highly efficient cross-party
at the lowest cost better targeted deployments settlements at scale
- P
 rioritize roll-outs to deliver - Improve benchmarking Discover Infovista’s portfolio and
the highest RoI in the shortest across equipment providers talk to our experts to find out how
time by targeting coverage by comparing based on your business can benefit from its
and performance in areas with customer experience, not only unique NLA offering.
the highest revenue potential equipment performance and Visit www.infovista.com/NLA
- A
 ccelerate 5G roll-outs running costs. to learn more.
with ML/AI-driven analytics • Customer-driven operations
automation for accurate
modelling of signal - O
 ptimize customer experience
propagation with highly by resolving issues with the
accurate 3D geospatial data highest customer impact first,
with customer experience
- M
 aintain reliable customer and network performance
experience in non-cyclical correlation
network load scenarios, by
automating the discovery of - M
 onetize high-margin
relationships (correlation rules) SLA-based services with
between network and service pre-emptive, automated
performance and customer troubleshooting for
experience anticipated SLA breaches

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TM Forum Open
Digital Framework

A blueprint for intelligent operations fit for the 5G era

The TM Forum Open Digital Framework (ODF) provides a migration path from legacy IT systems and
processes to modular, cloud native software orchestrated using AI.
The framework comprises tools, code, knowledge and standards (machine-readable assets, not just
documents). It is delivering business value for TM Forum members today, accelerating concept-to-cash,
eliminating IT & network costs, and enhancing digital customer experience.
Developed by TM Forum member organizations through our Collaboration Community and Catalyst proofs
of concept, building on TM Forum’s established standards, the Open Digital Framework is being used by
leading service providers and software companies worldwide.

Goals of the Open

Digital Framework
The aim is to transform
business agility
(accelerating concept-to-
cash from 18 months to 18
days), enable simpler IT
solutions that are easier
and cheaper to deploy,
integrate and upgrade, and
to establish a standardized
software model and market
The framework comprises TM Forum’s Open Digital Architecture which benefits all parties
(ODA), together with tools, models and data that guide the (service providers, their
transformation to ODA from legacy IT systems and operations. suppliers and systems
integrators).
Open Digital Architecture Transformation Tools
Architecture framework, Guides to navigate digital Learn more about
common language and transformation member collaboration
design principles Tools to support the
If you would like to learn
Open APIs exposing migration from legacy
more about the Open
business services architecture to ODA
Digital Framework, or
Standardized software Maturity Tools & Data how to get involved in the
components Maturity models and TM Forum Collaboration
Reference implementation readiness checks to Community, please
and test environment baseline digital capabilities contact George Glass.
Data for benchmarking
progress and training AI

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TM Forum research reports

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Meet the Research & Media team

Report Author: Report Author:

Mark Newman Dean Ramsay
Chief Analyst Principal Analyst
[email protected] [email protected]

Report Editor:
Editor in Chief, Inform:
Dawn Bushaus
Managing Editor Joanne Taaffe
[email protected] [email protected]

Customer Success & Digital Media &

Operations Manager: Event Coordinator:
Ali Groves Alexis Jackson
[email protected] [email protected]

Commercial Manager,
Research & Media:
Global Account Director:
Tim Edwards
Senior Analyst Carine Vandevelde
[email protected] [email protected]

Digital Marketing Manager:

Anna Kurmanbaeva
[email protected]

Report Design:
Intuitive Design UK Ltd
© 2021. The entire contents of this publication are protected by copyright.
[email protected] All rights reserved. The Forum would like to thank the sponsors and
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researched report. The views and opinions expressed by individual authors
Report Design: and contributors in this publication are provided in the writers’ personal
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Phone: +1 973-944-5100 interpreted as such. The reproduction of advertisements and sponsored
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For more about TM Forum’s

Collaboration Community,
please contact George Glass