Eye on the Money

February 01, 2012

Clouds: The Big Change is on Business Structure and Processes

This article originally appeared in the Feb. 2012 issue of Next Gen Mobility

Clouds are generating lots of discussion these days, and even more confusion. Some talk of clouds as web services and mash-ups, others as hosted services, and yet others as distributed computing or infrastructure. The fact is, all are correct, but all underestimate the scope of changes that cloud concepts will have on our telco industry, because, fundamentally, clouds mean that CSPs no longer will have end-to-end control over services and infrastructure. I propose that we look at the cloud phenomenon as real, and as a force that will make CSPs rethink their operations processes from monolithic to modular.

We can already see examples of cloud services in the B2C web. Individuals and companies mashup services from different providers into an end application. Examples of service components include storage resources (e.g. Amazon); sales/distribution resources (Amazon, eBay, Apple (News - Alert), etc.); social network data and preferences (Facebook, Google+, etc.); applications delivered via SaaS (e.g.: Microsoft Office 365, Xbox LIVE;, etc.) and myriad others. Today, CSPs are only beginning to participate in this ecosystem.

CSPs have much to offer in the cloud ecosystem. For one, they own the physical networks, and have exclusive ability and rights to control the quality of experience for services and users via admission control and bandwidth allocation rules. In addition, they have strong facilities for authentication (security), authorization (commercial business transactions, security), identity, and the faith from both the consumer and business communities for managing high availability resources (directories, other transactional services). What’s missing today is a concerted effort to make these attractive to the global development community, such that significant revenues flow to CSPs rather than around them.

Clouds may bring another benefit to CSPs. Cloud services on the web today have the quality of ubiquity – you can access Gmail or wherever you are, from whatever access network you connect to, etc. This can be a real opportunity for multinational or other confederations of operators. By applying cloud principles to service infrastructure, CSPs can centralize operations and ensure consistent services across their geographies – which improves costs, the user experience, and the ability to execute global marketing efforts.

The common element across all of these industry forces is that clouds require us finally to confront applications as being composed of building blocks. While the industry has espoused this vision in the past (IN, IMS, SDP…), we never truly embraced it – possibly because we never truly had to. Consider a cloud application where there is no single E2E owner – one company owns the storage; another the storefront; a third the charging process and authentication; while a fourth the network itself, etc. The only way to build such an application is to combine building blocks, which implies that:

·         the building blocks must be stable, and well defined;
·         configuration and assurance interfaces must also be defined and stable;
·         all the components must be documented and publicly available for use.

What we have now is an application assembler/creator and a series of building block (service) owners. And while the beauty of the cloud is it fosters innovation, flexibility and innovation so far has come at the expense of accountability, security and reliability and addressing the latter offers our industry an opportunity.

While we may no longer own the E2E application that does not mean that we can’t enable E2E management, service assurance, and accountability. We need to rethink our complex business processes – primarily idea to innovation (service creation); order to service (service fulfillment); and trouble to resolution (service assurance) – and recognize that every network component, service hosting cluster, and service component requires its own operations building blocks, so that the management functions are as modular and flexible as the service components themselves. In this way, we transition from monolithic processes to modular ones.

Our opportunity lies in our reputation for delivering good service and reliability via industrial-proven management software and operations. In effect, we can make the cloud enabled mashup grow up and meet the needs of business users and other demanding customers. If we make this transition, it just might re-establish our industry as essential to the growth of the web and innovation worldwide, and allow us a legitimate claim on a significant slice of the revenue pie.

Grant F. Lenahan is vice president and strategist for service delivery solutions at Telcordia Technologies.

Edited by Stefania Viscusi

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Rich Tehrani,
Since 1982 Rich has led TMC© in many capacities. Rich Tehrani is an IP Communications industry expert, visionary, author and columnist. He founded INTERNET TELEPHONY® magazine...Read More >>>
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