Transforming the Telco

MARTIN CREANER
 Chapter 1 – Breaking through the transformation
SPEAKER: barrier
Martin Creaner Chapter 2 – Understanding the Value of
Transformation in an Industry in
Turmoil
Chapter 3 - The 10 transformation Journeys of the
Digital Telco
Chapter 4 – Deciding on the right destination for
Background: your digital transformation journey
• Ex-President & CEO of TM Forum Chapter 5 – Making practical transformation
(www.tmforum.org) happen
• Motorola Chapter 6 – Driving Innovation in the digital telco
• British Telecom Chapter 7 – The Digital Services Landscape
• Advisor to leading Telco players Chapter 8 –Platform Federation and the Cloud
Chapter 9 – Closing thoughts

Author
• Transforming the Telco
Digital Transformation
• Delivering the Digital Economy
Mapping the emerging digital economy
• Frameworx Distilled
Telco Architecture
• NGOSS Distilled
OSS/BSS industry models

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10 Digital Transformation Journeys
Multiple transformation journeys will be required for a Telco to successfully complete transformation

The customer The technology journeys

engagement journeys include infrastructure
require not only a new way of transformation to NFV/SDN,
engaging with customers but a Data & Security
brand new approach to Transformation, and the
channels and how they are journey to open up the
managed network & systems platform
via APIs to 3rd parties

The operations journey The digital services

involves the enormous journey involves not only
challenge of changing the innovating and designing new
culture of the organization as exciting digital services but
well as the challenge of also learning how to manage
preparing the company to the wider ecosystem of
adopt new business models partners

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the likely destinations of the transformation journey
Digital transformation does not have a single destination, and it’s important to develop an informed view of where you
want the digital transformation journey to bring you.
a Telco that only offers a
portfolio of digital
a Telco that attempts a Telco that offers a full and services, but has dispensed
to provide full wide integrated portfolio of with their infrastructure
portfolio of infrastructure and advanced offering. High margin, low
infrastructure & digital services. High margin, cost
services, but under- ultra high cost
funded to compete
effectively. Low
margin - high cost

a Telco that focuses almost a Telco that supplements

exclusively on providing infrastructure and limited digital
connectivity on a wholesale service portfolio with an open API
B2B basis. Low margin - platform enabling 3rd party to go-to-
Ultra low-cost market. High margin – medium cost.

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Picking winning digital services Opportunities Map
Adopt a Clear & Consistent Methodology
Telcos prioritized based on OTT/internet player
Digital Services Innovation competition and telco competitive advantage
Framework (DSIF):
Identifying which digital services
areas may be attractive for Telcos
to pursue.

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Telco Capability Map
Important to develop a good understanding of the valuable Telco capabilities

Technical Non-Technical
Advanced Network and The telecoms industry has a
Partnerships
Technical Capabilities unique set of key
Secure device & user identity
Ability to operate with Government
capabilities
& strong regulation
Precision Location
Global Telco Partnerships Unique Telco capabilities are
Seamless Global Connectivity
Hardware development &
valuable to ecosystem
Distributed Edge Cloud (MEC) manufacturing partners partners
Infrastructure Business & Commercial Leveraging these capabilities,
Operations
Network infrastructure & mature
telecoms operators possess
Retail distribution, fulfillment & in-
OSS country support
significant control points in
Advanced connectivity services & 5G Broad customer base with existing the market for new digital
billing relationships services
Network virtualization & slicing
Local expertise and field teams
Content delivery platform
Trusted brand for sensitive data
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Important to Understand Ecosystems
Develop an understanding of the key ecosystems players, and the structure of the industry
Value % in each
layer of stack

3%
CRITICAL ANALYSIS STEPS
19%

17%
• Develop an appreciation
20% of the % of value in
each value stack
16%
layer.

2%

11%

11%

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Develop Detailed Use Case Analysis
Go beyond the generic digital services concept into detailed critical analysis in multiple verticals
Agriculture 1 Continuous Crop Health Monitoring Mining 29 Open Cast Mine Planning
2 Nutrient Mgmt / VRT Optimization 30 Mining Exploration/Maintenance
3 Targeted Pesticide Applications 31 Progress/Environmental Monitoring
4 Irrigation Management Efficiency 32 3D Underground Mapping
5 Sheep / Cattle Herding Oil & Gas 33 Gas Flare Inspection
Construction & 6 Construction Site Management 34 Pipeline Leak Detection/Inspection CRITICAL ANALYSIS
Infrastructure 7 Railway Safety/Inspection 35 Oil Spill Monitoring
8 Bridge Maintenance/Inspection 36 Oil Platform Inspection
STEPS
Disaster Management 9 Flash Flood Recovery Real Estate 37 Aerial Photography
10 Lifeguard Assistance Security 38 Border Control
Essential to develop a
11 Search and Rescue 39 Traffic/Highway Surveillance detailed analysis across
12 Wildfire Mapping / Fighting 40 Intruder Surveillance
13 Structural Integrity Assessment 41 Missing Persons Facial Recognition multiple verticals of
14 High Rise Building Fire Fighting 42 Law Enforcement potential use cases
15 CBRNE Disaster Tracking Telco 43 Critical Site Monitoring
16 Disaster Reconnaissance & Mgmt Infrastructure 44 Infrastructure Inspection
Energy & utilities 17 Wind Turbine Inspection 45 Infrastructure Maintenance & Optimization
18 Power Line/Poles Surveys Transport & 46 Infrastructure Expansion
19 Substation Inspection Logistics 47 First Aid Delivery/Medical Logistics
20 Hydroelectric Facilities Inspection 48 Organ Transplant Delivery
Insurance 21 Risk Monitoring 49 Parcel Delivery
22 Risk Assessment 50 Shipping Freight Delivery
23 Claim Adjustment/Validation 51 Food Delivery
24 Fraud Prevention Weather & 52 Wildlife Conservation
Media & Entertainment 25 Cinematography Environment 53 Climate Change Monitoring
26 Journalism (Footage Gathering) 54 Shipping Emission Monitoring
27 Targeted Ads / Promotions Vehicles 55 Reforestation
28 Drone Racing/Entertainment 56 Weather Monitoring
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Some of the digital services recently analyzed

Video Federated
Drones Automotive AR/VR AI Platforms
Analytics

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Drones Opportunity – Summary
LARGE OPPORTUNITY: For Mobile operators to connect commercial drones to a centralized cloud platform, for the safe management of
drones across verticals. Significant opportunity; forecast for the UAS technology market in 5+ years time at $41 – 114 billion globally

Use Cases & Ecosystem Analysis Control Point Analysis

▪ 150+ Use cases grouped by vertical and 130+ key players identified in ▪ Three control point platform opportunities within the 9
ecosystem core domains using future state scorecards and
▪ Agriculture, Energy & Utilities, Oil & GaS, Logistics, Infrastructure, determined the necessary component capabilities to build
Emergency each offering. These include:
▪ Example use cases of $100M+ in value include pest detection ▪ Drone Data Platform
(agriculture) and wind turbine inspection (energy) ▪ Operator Marketplace Platform
▪ Flight Management Platform

Market Opportunity / Profit Pool Business Model Analysis

Analysis
▪ Significant emerging IaaS workload category; drone data platform ▪ 3 business model opportunities for Telco segment
substantial opportunity; potential for value creation could exceed $114B ▪ Data Platform: Consolidated, open data storage and
globally in 5 years processing services for images, video, and sensor data
▪ Connectivity estimated to be 11% of the opportunity. collected.
▪ 55% of the opportunity north of connectivity i.e. IaaS=16%, Data ▪ Marketplace: Two-sided marketplace
Platform=20%, Analytics=17% ▪ Air Traffic Management: Regulatory policy and data
security concerns drive opportunity for centralized ATM.
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Connected Car Opportunity - Summary
LARGE OPPORTUNITY: Car data enabled services forecasted to be worth $450-750 billion. Telco’s can leverage their
connected car offerings to develop a multi sided platform powered by an automotive ecosystem.

Use Cases Analysis Top 10 Use Cases

▪ The 160 use cases analyzed can be grouped into: Autonomous 1. Platooning: Cooperative truck driving
Driving, Car Upkeep & Usage, Consumer & Enterprise Services
▪ Use case need to go beyond connectivity 2. Autonomous and Remotely Driven Vehicle Fleets
▪ Downstream use cases are all based on data (Shuttle Bus, Campus, Emergency etc.):
3. Software and Firmware Updates over-the-air:
4. In-car AR (information and entertainment services):
5. Car-view streamed video storage and sharing:
6. Seamless mobility and Seamless Global Connectivity:
Market Opportunity / Profit Pool Analysis
7. In-car Digital Assistant:
▪ Driver assistance is the fastest growing segment followed by
safety 8. Unconnected Car Platform:
▪ Recurring revenue from new services will comprise the fastest 9. Multi-mode Mobility-as-a-Service:
growing segment of the automotive profit pool by 2030 ($450-
10. ‘Uber’ for Freight: Intelligent applications match demand
$750 Billion market opportunity)
▪ Players with successful platform strategies will dominate for freight services

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Summary of Other Market Opportunities
AR/VR AI Video Analytics
Ecosystem Analysis Ecosystem Analysis Ecosystem Analysis
▪ 260+ companies identified in the AR/VR ▪ 200+ companies identified in the AI ecosystem are ▪ 180+ identified companies in the AR/VR
ecosystem organized across 8 domains and 32 corresponding ecosystem are organized across 8
Elements

Use Cases Analysis Use Cases Analysis Use Cases Analysis

▪ The 50+ use cases divided into 11 verticals ▪ 56 use cases analyzed divided into 13 verticals ▪ The 60+ use cases divided into 13 verticals
▪ Home VR is the immediate telco battle ground. ▪ Deep learning will be the most important AI ▪ With Retail, Transport and Consumer sectors
▪ Opportunities also exist in communications, technology. Professional services are the next big predicted to offer the best initial use case
gaming, sports, office productivity and retail emerging opportunity in AI opportunities

Market Analysis Market Analysis Market Analysis

▪ $120 Billion market opportunity by 2020 • $36.8 Billion market opportunity by 2020 ▪ Video analytics retail market revenues are forecast
▪ Hardware represents 50%+ with software and • Virtual Digital Assistant Market set to Reach close to be the largest slice at around $1.2Bn USD by
services making up the rest to US$16Bn by 2021; almost every industry will be 2022
▪ Largest markets are Video Games, Live Events, impacted ▪ Transport analytics forecast at around $525m by
Video Entertainment and Retail • Players with successful platform strategies will 2022
▪ Players with successful platform strategies will dominate the market ▪ Consumer video analytics forecast at around
dominate the market $235mn by 2022

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Federated Platform Business Models
* Platform business models will dominate many of the new digital services
* Telcos will struggle to develop successful platform business models that can operate globally
Telco 1 Telco 3

Multiple platform common elements

Telco 2 Telco n across many different types of services.
REV SHARE

REV SHARE

REV SHARE
REV SHARE
PAYMENT

PAYMENT

PAYMENT
PAYMENT
VALUE

VALUE

VALUE
VALUE

FEDERATION
PLATFORM + PARTNERS
DATA

PAYMENT

3rd Parties
Critical Telco Capabilities for Enhancement
Telco needs to prioritize certain capabilities to enhance their competitive advantage in key digital
service ecosystems

Precision location Video Analytics

• Utilizing the network to deliver assured cm-resolution device • Video analytics is key to many emerging use cases (including
positioning. automotive)
• Telco has a unique opportunity with many geographically • On-demand consumption is emerging as the preferred model for
dispersed locations, good connectivity & power, install & highly compute-intensive video operations
maintenance teams. • Strong synergy with edge cloud

Distributed Edge Cloud AI

• Bring Cloud nodes closer to the workload consumers, • AI will be increasingly important across many verticals over
increasing reliability, reducing latency and minimizing data time
backhaul • AI offerings are largely cloud-based and consumed as a
• Distributed locations with good connectivity & power are service
ideal for edge cloud deployments • Strong synergies with edge cloud to deliver the high
computation required

Assured Identity
• Leverage the telco consumer relationships, with device- and network-
Ecosystem Governance
derived behavioral data to provide more reliable identity • Management, enablement and governance of the ecosystem
is essential if it is to be effective and grow

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 Summary
➢ A fundamental rethink of Innovation will be one of the most important
journeys in telco digital transformation
➢ The telco needs to develop the ability to work with multiple innovation
partners to successfully bring new digital services to market
➢ DevOps excellence is likely to be a critical element of a successful digital telco
service provider
➢ A laser-focused methodology for delivery must be applied to help the telco to
pick the winners
➢ Telco needs to focus on enhancing a number of key capabilities to be
increasingly attractive to ecosystem partners
➢ Must consider a strategy of going beyond connectivity in order to generate
sufficient return in any chosen opportunity

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 Thank You

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