The future digital ecosystem enabled by 5G

Over the past few years, the telco industry has been facing major challenges and profound transformations. Telcos operators found themselves caught in a paradox: demand for the core product of connectivity is growing exponentially; yet hyper competition, saturated customer wallets and continuous investment request to satisfy that demand, means organic growth options are limited. The worldwide health crisis we are facing today will both accelerate and amplify this process.  Fast digitization of our societies was already on; the past few months will only make is happen faster. In addition to this shock we will overcome together, our industry also stands at a turning point regarding technological evolution. 5G has been launched in many countries and will open a whole new range of use cases especially in the BtoB market, and our networks are also quickly moving towards softwarization.

More than ever, everything is about IT in the telco industry.  

First, network management is an IT issue. If we want to take full advantage of 5G, we need to bring together network and IT. Both have similar challenges and will use the same cloud services. Without IT, we cannot operate and monetize 5G, and IT has already started its cloud native journey and can help network do the same.

Secondly, even if human interaction remains key, customer experience is also now an IT issue, even more in a post Covid19 world. The pandemic and its consequences impacted customers’ behavior. The appetence for digital interactions has grown dramatically and puts a pressure on IT. The lockdown brought a change to our daily lives, the way we socialize, the way we work and consume. Digital channels, including bots and apps, are becoming more important in the customer relationship as they match our clients’ expectations for an easier and a faster customer path. Moving towards a true end-to-end omni-channel experience isn’t easy, yet becomes mandatory.

Thirdly, IT transformation is absolutely essential to support the strategy of many operators including Orange: going beyond connectivity to become digital service providers by adding new products, services and capabilities. To stay relevant and keep growing, operators have to capture part of the new value they are helping to create thanks to their networks. But obviously developing new digital services needs a great IT agility and to seize all the opportunities, we need to re-think the way we do IT.

IT has never been so key to our business and I can tell you IT is no longer the concern of the CIO alone; it is now a strategic capability that is highly visible in the Boardroom.  

The way we telcos operate IT today is complex, too rigid and cost-intensive. Our core IT, the billing systems, the ordering systems, the provisioning systems, the ones we built ten to thirty years ago, is often made of monoliths.

Legacy processes and technologies are a systemic part of the problem. Progress to address these challenges is slow. Carriers often struggle to balance “quick fix” changes to meet short-term business needs  with investing in sustainable long-term transformation of the business and the software that runs it.

So what can be done to achieve a true digital transformation of our industry?

The first and maybe the main issue we have to deal with is about culture and new way of working. Whether deploying smaller analytics use cases, building out adjacencies in new digital businesses that monetize operators’ data, or undertaking company-wide transformation, generating success necessitates a fundamentally different way of working, an agile one with a time to market of weeks or even days rather than months. It’s easy to say but I really think we will not be able to achieve any significant transformation without this cultural shift.

But it won’t be enough. I am fully convinced that the industry also needs a rapid shift to an open, modern, software based technology architecture that enables new operating and business models. One which is loosely coupled, cloud native and AI driven; made up of standard components which can be easily procured and deployed, without the need for customization.

In other words, the telco industry must evolve from a closed IT architecture, where it only delivers its own services to its own customers, to an open platform architecture – accessed through openly available APIs.

This is the purpose of ODA, TM Forum’s Open Digital Architecture. ODA is based on a modular and cloud-native architecture with software components enabling IT and network capabilities over time. It opens the possibility to embrace digital native approaches for our IT systems to deliver fast results and efficiency. It is the best tool to enable communication service providers deliver intelligent operations, fit for the 5G and IoT era, leveraging Artificial Intelligence. ODA will mark a significant change for the industry, simplifying the solutions and removing the need for large-scale customization and integration. By being “plug’n’play”, ODA reduces the burden, time and costs of integration. Following the “Lego” architecture, every component can be delivered by one or several service providers, by telcos operators themselves or by any open source community. This flexibility makes it particularly fit for legacy telcos actors willing to evolve towards an enhanced digital offer.

Only through collaboration can the industry attain the required knowledge and agree the required standards and common code assets such as APIs. I believe that TM Forum is the platform to drive rapid innovation in these developments and will play a critical role in starting the dynamic. We have seen subsequent progress over the past few years, as several actors have now taken public commitment towards ODA. Yet we need to keep on working together to match the same conformity level as the one we managed to reach in the telco industry. I also believe that open-source can help us standardize the foundations and facilitate innovation on top of it. This should give vendors a lot of scenarios to differentiate but in way which drastically reduces the integration and deployment burden. I’m delighted to see that TM Forum embraces the open source way of doing standards not as a threat for software vendors but as a catalyst to accelerate consensus.

TM Forum is for IT, Data & AI what GSMA is for mobile networks. We need to make GSMA and TM Forum work closer together. And we need to do it now because it is essential if we want to grasp a healthy slice of the future digital ecosystem enabled by 5G. As I said, we need to fundamentally rethink our operating model, our processes, our ways of collaboration and our ways of working. This means that we should revisit our culture.

Adapted from the keynote at the TMForum 2020– Digital Transformation world