Network transformation: drivers, opportunities and challenges

Abstract

The traditional role of the network operator as connectivity provider is no longer viable. To survive in this hyper-competitive environment, carriers are looking to re-invent themselves as value-added service providers. If they want to prevail in this new market environment telcos must take decisive steps to transform their network, systems, people and processes, leveraging a single, converged, IP-based infrastructure.Die Umgestaltung der Kommunikationsnetze: Treiber, Chancen und Herausforderungen.Die traditionelle Rolle der Netzbetreiber als Anbieter von Kommunikationsverbindungen kann nicht lä nger aufrecht gehalten werden. Um in diesem von extremem Konkurrenzdruck geprä gten Umfeld bestehen zu kö nnen, sind Netzbetreiber bestrebt, sich als Anbieter von Mehrwertdiensten neu zu positionieren. Um sich unter den geä nderten Marktbedingungen durchsetzen zu kö nnen, mü ssen die Kommunikationsanbieter entscheidende Verä nderungen in ihren Netzen und Systemen, bei ihren Mitarbeitern und Prozessen vornehmen. Ein Lö sungsansatz dazu ist der Ü bergang zu einer einheitlichen konvergenten IP-basierten Infrastruktur.1. Why telecom service providers need to transform their business Not since the advent of the Internet has the telecoms industry faced such change. Competition for customer mind-share and walletshare is at an all-time high. Threats are no longer limited to predictable network-based operators but include virtual operators and application providers with network-less assets. High-value services are increasingly sourced from new market players such as Google, Yahoo, eBay, etc., leaving network operators out of the revenue and value-creation mix.As the table below is showing, these new entrants have vastly lower infrastructural and operational costs than service providers who own and maintain networks, and they are often showing more agility in responding to new market trends and end-user requirements.We can conclude that the traditional role of the network operator as connectivity provider is no longer viable. To survive in this hypercompetitive environment, network operators are looking to reinvent themselves as value-added service providers. Therefore, service sophistication and speed of innovation become the foundation for a sustainable business model, and it is without discussion that moving to an all-IP infrastructure is key to agile and cost-effective service creation, deployment and operations: "Transforming the legacy network to support growth assets "