Telling the truth of Telecom APIs

Once more telecom APIs are the answer to telecom's woes.

If you want to know my opinion on what will work read on. This article is my attempt to get as simple as possible in explaining where potential lies, and where it does not. Why initiatives will work and why they will fail. I break down into two broad categories.

1. 5G network exposure as an asset.
2. Customer knowledge as an asset.

TL;DR: Don't believe any forecasts. #1 never happening; #2 already started.

Before starting meet Alan...

Before sharing my beliefs and history, let me recommend Alan Quayle and his Tadhack series of events the next being March 23-24. Alan has been working in the space of telecom APIs as long as I have but has been more proactive in successfully developing a momentum of companies doing real business in network APIs adjacent to the MNOs. Ask him for his opinions on the latest industry beliefs - his answers may be shorter (and even more uncomfortable) ??

Industry apology...

Network APIs are not some kind of magical ticket to revenue growth nirvana. APIs are simply how software programs communicate with one another. I have already published one article dedicated to demystifying this.

Ericsson is not getting its six billion back. It has already admitted and written off 3 billion. Bets in comments when the next 90% of 3 turns up please.

If APIs are ways to communicate then it has to make sense to want to speak to the other side. When you go to parties, are there people you avoid speaking to?

Who do you intend to avoid at parties? People that spend all evening speaking about themselves and how great they are?

Using the same analogy is a good way to understand network APIs. On one side of the API conversation are software developers who need to solve problems relevant to them. They are looking for an API conversation that solves what they need, not the other way around. There are many different types of software developers and many different types of needs. If you think they are waiting for telecom to turn up and solve their future needs you cannot be further from the truth.

Destroying bullshit - Network Quality Guarantees

The suited person smiling in the image above is the consultant that has sold the telco executive they can make between 100 and 300 BUSD with APIs providing 5G network quality guarantees to all these industries. This does not mean there are zero opportunities to guarantee network quality but it is delusional to believe these are widespread and mass market. The only situations where network quality guarantees can be made are when

• The client can only attach to the one 5G network. This may be possible with private networks dedicated to the one user, with devices locked to that one network.
• It may be possible if the solution has a fixed location where the public 5G network can be engineered to provide dedicated/guaranteed coverage.
• In both cases the specific performance engineering is more related to the use cases, the end to end solution and many different technology alternative ways to solve the customers needs. This requires deep domain knowledge and there are lots of technologies involved. 5G is just potentially one of them.

The reality for the mass market is we will live in a multi-network best effort coverage reality. I will never only attach to 5G, in the same way I have never only attached to 4G. Developers need to deliver functionality to their customers with guarantees. If they cannot guarantee they are connected to a network that supports special "5G quality" then they cannot program their solution and they cannot use the API "that might not work". 80% of the time I am not using cellular at all but rather Wi-Fi.

Mini-conclusion

The network quality opportunity is a delusional big market opportunity that does not exist, and will not appear with any scale. It can never be guaranteed in public mobile networks if the client is mobile and not hard tethered to one network. It can be implemented in private networks, this is nothing new when delivering systems that have to perform to customer SLA requirements. If MNOs want to pursue this opportunity they have to become good at delivering to these verticals. There are two big examples, mines and ports, where private 5G is successful. This is not an API opportunity, it is a mine and port opportunity, that can use APIs to make internal implementation easier. Opportunities are niche and require domain expertise to step above commodity connectivity returns.

This is not an easy or obvious opportunity for telecom to win and does not play to any telecom strengths except "I bought a new network that technically promises it can do this if you are connected to it, in theory". From the mass market perspective I advise all telecom operators to save the money spent pursuing this public network ROI white elephant. For vertical implementations get ready for a whole world of new flavors of pain.

Shit - What do we do then?

Look forward not back. The asset of telecom exposure is not the networks, it is the real time customer knowledge.

It is the ability to signal to other industries helpful information, while keeping all of us safe and private. This is a growing market as AI enables more and more sophisticated attacks. Today this is small but rapidly growing is becoming very frightening. Tomorrow it is much larger and will be important at country GDP level.

The starting market opportunity is fraud and identity management that works independently of the network somebody is attached to. The creativity of scams is exploding [AARP link example]. Even in the traditional space, Stripe predicts just online payment fraud to reach $206 billion by 2025, up from $130 billion in 2020 [ref]. This is material lost revenue for all businesses as they move online and is just one aspect of the future challenge. Provenance of content, people pretending to be somebody else, the list is growing and endless. We are moving into a world where we can no longer trust what we see or hear, however realistic it appears.

Telecom is being successful in this space. One recent example being the announcement below from NatWest Bank in the UK.

This business is making sense and many countries are now pursuing establishing the same. All operators in a country need to collaborate to offer one integration point for all businesses that want to use the service.

Mini-conclusion

In the UK this business is worth 30 MUSD and is growing as new use cases and opportunities are discovered. This is how a real API business works. You discover value you can provide to a customer, you make it very easy to access, and then you start to discover more opportunities as you further embed in the value chains and the customer problems statements.

In closing remember this...

Saying APIs are the answer is the same as saying HTML pages were the answer when the web started. The fact some powered the New York Times and some powered online porn was a detail the statement overlooked. APIs are a messy difficult business that requires finding a core value that others benefit from. This is very different from having a technology that you need others to use. The latter fails. The former creates platforms.

Here are the Telecom API pieces of advice from somebody that has been involved with telecom APIs since the late 1990's and wants to avoid the deja vu once more.

1. 5G Quality of Service is not interesting unless the network is dedicated to the one customer (private) or the user is in a fixed location and guarantees can be given.
2. Telecom value is customer knowledge that is valuable for others to be able to interrogate.
3. The starting place of a good network customer knowledge API business is fraud management. Repeat the blueprint of others. Get help from GSMA and Richard Cockle . Execute the basics quickly.
4. Country level operator cooperation is the pre-requisite to success since customers want to address 100% of a population of a country. This maps to payment and regulation.
5. NEVER disclose personal information. Allow interrogation of information that can return a "signal" of probable truth. Keep usage with legitimate business definitions (GDPR) and ensure interpretation of answer is the responsibility of the requester not the provider.
6. Make the APIs as available and easy to use as possible. Collaborate with fellow operators to make one world class exposure portal per country. Force commonality and collaboration. Ensure 1) they are easy to find; 2) they are easy to try; 3) commercials are aligned; 4) it works as promised.
7. Start with the use case, implement from the customer in. New opportunities will appear if you are looking for them.
8. Grind success, don't believe there is 100-300 BUSD market waiting for you to arrive.
9. Don't buy an A2P aggregator for 6 BUSD unless you can afford to...

Every 15 years there is a true paradigm shift. In the 90's it was the Internet. In 2007 it was web 2.0, mobile broadband, smartphones. In 2020's it is AI. Leaders change, experiences are reinvented, new threats and challenges are born that must be solved.

A message to all in telecom. Don't miss this one. It starts and ends in software and the core business may look very different at the end of it.

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