Realising the Data Driven Telco

While the Internet of Things (IoT) is hot in the market, three key capabilities can place communications service providers (CSPs) front and center in enabling enterprise use cases. It is all about the data.

Telecom networks—and their operators—have been facing a deluge of data, and we’re only seeing the tip of the iceberg. IDC estimates that enterprise industrial use cases, which account for only 21 percent of the total number of devices in Asia/Pacific, excluding Japan and China, will generate 5,800 petabytes (PB) of data per day by 2024. 

Some trends which will be adding to the tsunami of data:

• The drive to increase automation and data collection. Over the last couple of years, Internet of Things (IoT) deployments have been largely driven by operational efficiency gain desires from the enterprise. This is reflected in a desire for greater employee productivity and better processes. This outcome can only be driven by incorporating automation in the data flow through the enterprise.
• The massive increase in endpoints. By 2022, IDC expects that 60 percent of Asia/Pacific companies will use customer experience as their top driver. Data must be more aware of context, driving the need for data integration, schema management and analytics. Moving from operational efficiency to that more externally facing customer experience view means that the value of data is being driven by how enterprises engage with their customers alongside generating internal efficiencies.

What does this mean for network operators? Even though not all of that 5,800PB of data will traverse the whole network, understanding where the data is coming from, protecting it and ensuring its smooth transformation from data to insight will fall squarely into the realm managed by network operators. The richer that data is when it reaches applications and analytics, the faster it can be transformed into outcomes. 

IDC has defined a seven-layer IoT ecosystem model (see graphic below),  built on a foundation of things like video cameras, sensors or actuators. This layer generates data about the state of the real world. Given the volumes that we're dealing with, we'll need as much edge computing and intelligence through automation as possible so we can derive value quickly. Edge computing environments, which carriers are already building to support 5G networks, will expand to process the bulk of this data in support of enterprise use cases. 

The role of the platform in the cloud is essential to allow for flexibility, scalability and workload management. Security, authentication, authorization and automated workflows will be embedded in each layer of this model. Daily data will not come from a given location consistently nor will it arrive in a consistent manner over time. As a result, platforms must be scalable and allow workloads to migrate from one network location to another.  It must also have common layers of security, governance and data management along with data analysis and applications to process that data. 

Enterprises are already investing in these use cases. So much so that IDC expects horizontal platforms from IoT use case spend over the next five years to be US$1.8 billion with a 34 percent compound annual growth rate, growing from about US$600 million in 2020. The availability and speed to market of these horizontal platforms makes them ideal candidates for enterprise use cases, especially if they're located in the cloud. They must be flexible, so these platforms can support the varied industrial use cases and extend to support the needs of individual markets and enterprises. 

Network operators are also looking to capitalize on the opportunity afforded by IoT. Carriers have rated IoT products and services as the most important product or service for carriers to implement across Asia/Pacific, according to IDC’s annual Carrier Transformation Survey. The good news is that 45 percent of them already have data analytics teams and platforms in place to manage carrier-wide delivery. 

Many carrier use cases have been internally focused around customer management, fraud detection, risk management and infrastructure optimization. But a fair percentage are also looking beyond their organizational boundaries:  40 percent in the Carrier Transformation Survey say they already have existing data monetization offerings, mostly focused around location services from mobile. A further 50 percent say they will be building those capabilities in the next 12 to 24 months. Only 10 percent of the carriers surveyed say that IoT services are the most difficult ones they would have to offer. 

Overall, enabling the data driven telco requires that operators deliver on three basic components. 

1. Ensure the security of device, data and process is the cornerstone of organizational IoT strategies. Endpoints are not people. They are machines. They must be protected. The more mobile they are, the more protection they need.
2. Embed data-aware automation. With data science skills in short supply and the enterprise appetite for data unabated, managing petabytes of data requires intelligence to be embedded in the IoT platform. Scripting, AI/ML and rule processing become fundamental elements of the data-driven telco.
3. Build general-purpose horizontal platforms that support the creation of vertical solutions.Operators will need to build, buy or grow domain expertise within their services teams to enable the interface between horizontal customization platforms and vertical, industry-specific solution sets. Partnering with cloud, data, security and industry expertise will form the basis for successful solution ecosystems.
4. Allow the capability to customize offerings so that those offerings can be expanded. Enabling of marketplaces, support for innovation and co-development environments build on the traditional customization of solutions. Operator ecosystems can be brought to bear, to enable solutions across a broad range of industry verticals.

Learn more in The Data-Driven Transformation in Telecommunications, an IDC webinar sponsored by Oracle Communications.