 | Issue: | EMEA 2005 |
| Article no.: | 9 | |
| Topic: | IT has entered the participation age | |
| Author: | Darrell Jordan-Smith | |
| Title: | Vice President, Global Telecommunications | |
| Organisation: | Sun Microsystems | |
| PDF size: | 52KB |
About author
Darrell Jordan-Smith is responsible for Sun’s strategy and profile within the global telecommunications industry. Appointed in October 2004, Mr Jordan-Smith provides strategic market leadership and helps define solutions for customers that exploit industry trends to address their key business and technology issues. Before his current role, he established and led the Vodafone global account team, responsible for the business relationship with the Vodafone Group across 50 countries. Over the years, Mr Jordan-Smith has developed a reputation for innovative business development practices targeted at helping service providers increase ARPU, drive out cost and realize full returns from IT investments. Before joining Sun in 2000, Mr Jordan-Smith held senior sales and management roles within the AT&T Group of companies including Lucent, NCR, AT&T BCS and AT&T Communications. Now based in the USA, Darrell Jordan-Smith holds an MSc and MBA from the University of Glasgow.
Article abstract
The growth of mobile communications, voice and data, is helping to create both communities of users and communities of applications developers to serve user needs. The participants in these communities are driving change, creating new businesses, new social services and a new network economy with growth fuelled by sharing and collaboration. Carriers facing declining voice revenues are counting upon these new developments to provide compelling new services that build revenues and reduce churn.
Full Article
The pace of communications technologies is changing ever more rapidly. Not just in small ways, but in very powerful ways that are putting the development of communications applications, such as VoIP and mobile content services, in the hands of many new players. We can call this new era the Participation Age, where given dramatically lowered barriers to entry, plummeting device prices and near-universal connectivity, subscribers and others are driving a new round of network participation. Based upon handset-driven communications such as SMS messages to web services, participants are forming communities that drive change, create new businesses, new social services and new discoveries. This network economy growth is fuelled by sharing and collaboration among communities interconnected by technology and driven by purpose. Sharing and collaboration in the Participation Age will stimulate innovation and help participants around the world grow and prosper. Global carriers look to their equipment and software suppliers for products and services that will help people around the world participate in something bigger. Suppliers need to focus upon helping carriers improve operations, cut costs in their data centres and upon supplying tools and service delivery platforms, so that carriers can create compelling new applications. What EMEA carriers face While all can participate in making things better as a community, telecommunications executives, realistically, must focus upon the bottom line. Cost reduction is currently a big concern for EMEA telecom operators. They need ways to consolidate their infrastructures, to save money and free up resources to invest in developing new services and driving more revenue. Voice revenues are declining, so telecom operators need to reduce churn and derive additional revenues from existing customers. Accordingly, the telecom operators’ top priority is developing compelling and popular services for their subscribers. Vendors can assist carriers with cost reductions and innovative offerings of incremental revenue-generating services. Providing developers with powerful software creation tools enables them easily and rapidly to develop compelling and marketable applications not just ‘me too’ copies of existing services. That is what participation is about. Network operators battle constantly to increase their ARPU (average revenue per user) and AMPU (average margin per user) while decreasing churn rate. EMEA’s wireless operators are working to make it easy for customers to discover and use the new data and messaging services they offer that provide access to entertainment, information and communication channels. Fixed-line telecoms are examining ways of utilising their networks to provide as many new services as possible, to counteract voice revenue decline. Fixed-line operators are competing against the decreasing price and increasing reliability of mobile calls, and the tendency of many mobile users to choose to have just one phone and one number. They are also fighting the threat from cable companies that offer triple play, television, telephone and broadband, services combined. Fixed-line operators are fighting back with attractive bundles of broadband access, cheaper voice calls, soon to come IPTV (Internet Protocol television) and, at times, mobile telephony. Today, applications, services and digital content are increasingly targeted to each specific customer, so the importance of customer identity and identity management is growing for operators, content owners and customers. Today, too, telecommunications is highly virtualised because of packet-based communications, VoIP, GSM, CDMA, etc. The wireline is gone, and with it the direct connection between carrier and customer. What remains is the digital identity of the consumer. Telecommunications services are converging, and so are digital identity services. For example, the IP Multimedia Subsystem (IMS) architecture’s HSS (Home Subscriber Server), the network database that identifies the user, especially while roaming, to the local system, is the growth area for the modern carrier. The carrier view in EMEA and USA In 2005, EMEA carriers are working to rebuild profitability. They are evaluating IMS deployment while maintaining legacy networks. Many carriers will also begin IPTV exploration and deployment. The top three issues for telecoms in EMEA, as for all businesses, are: ways to reduce cost and complexity, the quick and efficient delivery of new services (i.e., voice, data, picture and video) and returning to, and maintaining, profitability. In the future, it will be the servers, storage, software and services that will make it possible to offer the ‘one-to-many’ or ‘machine-to-machine’ messaging services, the mobile web services and the enterprise-class applications that will drive revenue and usage during the coming years. Partnering between equipment makers, software vendors and carriers offering managed services is alive and well in the USA. The focus is upon bringing capabilities and services to market based upon the IMS convergence architecture, VoIP applications, video conferencing, multi-player gaming and ringtone downloads, all to give the carriers more to sell than plain old voice. Worldwide, rollouts of IMS are just beginning. IMS requires a new generation of carrier-grade hardware platforms, next-generation blade platforms, capable of supporting the high-bandwidth telecom services that they support. Blade server technology is making great inroads into carrier data centres. It is particularly suited to optimise voice and data convergence on next-generation networks. Enterprise software, running on advanced operating systems that manage identity profiles and permissions, provides operators with a solid foundation to develop IMS applications. Java, a case study for community The community and participation model is evident in the many companies and industries that have spun off from Java. Java created an environment that facilitated great growth in applications development, by enabling the communities of developers who took open development platforms to heart. Business applications, information gateways and massively scalable network games, which simply did not exist before the widespread adoption of Java, are now in common use. Security must be built into everything these days, not just provided as optional add-ons – you must bake security into products at the development stage. The Java platform, for example, was developed with security as a fundamental principle, so it cannot be used to carry or spread viruses to the operating system or a phone. Java’s open model makes it appealing to developers and carriers, who seek low development and ongoing operational costs. Ovum projects worldwide mobile data services revenues of US$137 billion by 2008. That means the market will grow roughly 21 per cent annually for the next four years! With more than 700 million Java-enabled handsets deployed, the Java developer community will grow to develop the new applications this growing market demands. Economic and social progress Not all of planet Earth’s citizens have equal access to technology. Not just governments, but large global firms need to dedicate themselves to improving network accessibility and eradicating the digital divide. Enabling a new wave of network participants, be they developing applications for healthcare, education, manufacturing or gamers, will deliver untold economic and social progress. At the United Nations this past June, we joined others committed to philanthropic efforts to drive participation in this new age. China, India, Ethiopia, South Africa, Nigeria and Kenya received millions of dollars in Academic Excellence Grants and donations during the last two years, and tens of thousands of students in China now have free access to web-based courses. These and other programmes focusing specifically on increasing participation will continue under the Share the Opportunity umbrella. Today, those without an education and those without access to computers must also play a part in the growing, interconnected, community that leverages the Internet, technology and tools. They will help define the needs, the applications and services that build better lives, a better economy and a better society for all. They too, and their children, will be part of the next generation of engineers, scientists, diplomats, business leaders, journalists, artists and consumers. They need the network to participate in the new information society. We are working hard to expand the opportunities for everyone irrespective of culture, nationality or economic means.
