Wednesday, October 26, 2005
For those who follow this Blog, you'll know that after presenting and discussing our initial strawman list of the Top 22 IMS-enhanced services at the IMS World Forum in mid October (see relevant posting below), we applied a new Evaluation Method that has recently been created by our sister consulting company, STL (www.stlpartners.com), to go through a much more rigorous analysis and prioritisation. A Top 6 list of ‘winner’ services popped out and we worked up some case studies to describe them in more detail. The output is generic of course, but should be very useful for stimulating debate and directing decisions inside operator (and vendor) organisations.
We found that, even with tech-literate forward thinking commercial managers inside Operators, we needed to very carefully caveat what we meant by 'IMS-enhanced/enabled services'.
Below are the sorts of words we used. They helped a great deal in clarifying what we meant. And they may be useful to you, if you're trying to talk about this subject internally (or with clients, if a vendor). I'd be very interested in your own experiences: firstname.lastname@example.org.
The services outlined [in this Report] could be (and some already are, to a large extent) delivered today without the benefit of IMS architectures. What IMS facilitates is faster, easier and cheaper convergent service creation. If service providers' future success will depend on this, then they are going to need all the help they can get in this area. The following points are very important to take on board before reviewing this Top 6 list of IMS-enhanced/enabled services [or anyone's list for that matter]:
• IMS architectures will allow providers to deliver more services, across more networks in a more integrated, flexible and lower-cost manner. Importantly, it will allow service providers to bring together the same set of building blocks in different ways to different users.
• The services outlined in this report (and many variations), will live or die depending on how easily understood and adopted they are by users. Amongst other things, this will be a function of the context that the services are presented to users to “help them do stuff they want to do”. Getting this right will require learning what does work and what does not work and evolving services accordingly. As some users become more sophisticated, so will their expectations and demands.
• Much of what IMS has to offer is enhancing existing services, often through minor changes in presenting information or how existing functionality is accessed. Most users do not know how to use (or would even think of using) much of the functionality available to them today in their existing services. A good example of this is inviting a third person to join a call. This facility is available today on most fixed and mobile networks, yet very rarely used. It is also available on Skype, but in an intuitive manner, almost inviting users to try it.
We must remember that what IMS offers is not only new in the “what” of services, but also the “how” services are defined and delivered. There are certainly minimum technical requirements to be able to deliver these services (cf. our IMS Maturity/Readiness Index), but we've considered this in our suggested timescales for delivering these services..."
The first, from The Moriana Group, is "the bible" and the second, on Wikipedia, is the "bluffer's guide":
An Operator Guide to IMS and New Generation Networks and Services.
In August 2005, The Moriana Group released a major report on IMS entitled: An Operator Guide to IMS and New Generation Networks and Services. This report includes surveys on the IMS Core Network, Integrated Services Framework and Charging; application listings, white papers and product profiles from recognized leaders in the IMS space. 20 contributing companies included: Redknee, Microsoft, IBM, BEA, Motorola, Hewlet Packard, Telcordia, Ulticom, Ubiquity, Kabira, jNetx, Appium and others.
The Operator Guide to IMS is available for free download since August 2005 from www.morianagroup.com
Understanding IMS from Wikipedia, the free online encyclopedia
The IP Multimedia Subsystem (IMS) is an open, standardised, operator friendly, Next Generation Networking (NGN) multi-media architecture for mobile and fixed IP services. It's a VoIP implementation based on a 3GPP variant of SIP, and runs over the standard Internet protocol (IP). It's used by telecom operators in NGN networks (which combine voice and data in a single packet switched network), to offer network controlled multimedia services.
Good introductory presentation for audiences who want to understand the basic technology:
If you have any other favourites, please let me know: email@example.com
The Editor, IMS Insider
Below is a short extract from October's IMS Insider report, out tomorrow night to subscribers (see www.ims-insider.com).
(NB: The report goes on to describe a new and detailed IMS services prioritisation and development methodology, an IMS Maturity Index ("IMSMI") that helps operators match these services to technical readiness, and goes through case studies of what we feel are the Top 6 IMS-enhanced services that can steal a march on the competition and generate significant revenues.)
"...Over the last month we've been collecting objections to "IMS". These are currently helping to keep IMS stuck in the "something to do with Service Delivery" bucket in the minds of senior commercial management within Operators. Here's a sample:
- The technology’s way off being ready
- It’ll never be fully interoperable
- It’s a flash in the pan - we've seen this hype before (with WAP and 3G)
- It’s just a way for vendors to sell more kit to us
- It’s going to be much too difficult to make it all work – we don’t have the skills, let's stick to our knitting.
- There’s no real customer demand for ‘combinational’ multimedia services.
- These ‘new services’ are nothing new. We can do them today without IMS!
- We’ve got more important things to focus on (like growing our revenues by by 5% this year and subsequent years in a declining market - NB: For Vodafone that equates to c. GBP £2.5 billion revenue growth per annum!!)
For those trying to promote IMS inside their organisations, and particularly to those trying to engage commercial management and marketing functions, here are some ideas for introducing a response to the objections above:
"All these objections all have merit…if we continue to think about things in the same way we have in the past. IMS potentially enables not only a fundamentally different technical architecture, but also a fundamentally different business architecture. It potentially enables different (and more relevant) services for our markets of the future. In so doing, it potentially enables a different (and more relevant) way of doing business.
The problem is that this ‘future’ is not so far away. The competition, from all sides, is moving fast. Internet companies, for example, have 6 week release cycles compared to the 6-12 month release cycles of traditional telcos. It is the way they do business - their flexibility, their speed, their user-friendliness – which, when combined with rapid advances in technology and changes in the regulatory environment, makes them the biggest threat to our business.
The current strategic response to this threat has been for operators to move into ‘content services’ (I-mode perhaps the best example, Vodafone Live! a poor cousin, ‘3’ staking its whole business on it). But, this is surely not ‘core competence’. The key for us telcos is to focus on communication-oriented services, mobile/fixed-messaging-based-communication-oriented-services – a melding of communication with content and applications. And this is what IMS uniquely enables…and, potentially, at an affordable price.
So, while the technology behind IMS is important (and challenging), the bigger question is what sort of enhanced multimedia ‘services’ should we driving towards, and how should we create an effective pipeline ...that is realistic and implementable. Our competitors are starting to get this message. I'd like to involve you [commercial management and marketing functions] in a much deeper collaboration on how we should address the opportunity and challenge. We need to integrate the network development process with the service development process. Carpe diem..."
Monday, October 24, 2005
Sincere apologies to those who tried to get through to the www.ims-insider.com website to subscribe to the service over the weekend, or who tried to email me at firstname.lastname@example.org.
NB: The October IMS Insider Report is out on Thursday and features a new methodology for defining and prioritising IMS-enhanced services. It also lists our view of the Top 5 IMS-enhanced services for operators, based on in-depth research and discussions with many practitioners over the last month. There are some mini case studies explaining why, and a deployment framework.
You can subscribe at www.ims-insider.com. Remember the 25% discount on the annual subscription for those who join in October.
The Editor, IMS Insider
Thursday, October 20, 2005
Fundamentally, he is right on all counts. He is asking "what price IMS"? And the price is going to be much more than generally anticipated. However he did not go into the benefits: yes it costs a lot to get IMS, but that is countered by the benefits in multimedia services revenue, and in defending against commoditisation.
His points are a shot from the hip. What we need is a much more rigorous assessment of the ROI, that takes into account the top line as well as the technical costs. This is precisely what you can get this in October's IMS Insider Report (subscribe at www.ims-insider.com).
BellSouth’s Denny pours cold water on IMS (By Tim McElligott, Oct 6, 2005 4:48 PM, TelephonyOnline)
It was not by chance that a self-proclaimed IT guy, Mike Denny, senior architect in the Technology Group at BellSouth, addressed today’s Fixed Mobile Convergence conference in Chicago on the implications of IMS on operations and business support systems. IT is the OSS/BSS of IMS.
“IT has been doing IP since the mid-‘80s, so welcome to our world,” Denny told attendees at the conference.
IMS sticker shock
As senior architect, it is Denny’s job do a cost analysis BellSouth’s vision of IMS. “I provide the sticker shock,” he said. Without giving hard numbers, Denny illustrated that IMS’ impact on the back office was even more significant than that on the core infrastructure. He left no doubt that IMS is being implemented on an industry-wide basis, saying that all telecom equipment manufacturers have IMS roadmaps, if not IMS solutions already in the market, but he threw cold water on any expectations that it would be easy. “There is going to be a lot of work on the OSS/BSS side of this,” Denny said.
Short-handed on expertise...
Echoing the thoughts of Telcordia’s Grant Lenahan, executive director of wireless mobility and chief strategist, as well as Siemens network division’s Felipe Alvaraez Del Pino, Denny said there is a dearth of expertise when it come to getting all this work done.
Only 750 of BellSouth’s 63,000 employees are in its IT shop. However, the company used several thousand contract workers to work on issues ranging from the migration to IPv6, security management, rating and charging, security, subscriber data management and perhaps one of the most important areas: service creation and delivery.
...and on standards
The service creation environment is hot, hot, hot, Denny said. And every software vendor seems to be calling its product a service delivery platform. However, he said a lack of standards in this area is causing more problems that it is solving.
“It seems like you need someone to take the lead in defining a standards-based service delivery platform,” Denny said. “The service delivery platform will be key to your competitiveness.”
He added that both IT and telecom will need to start speaking each other’s tongues.
Another area of concern, Denny said, is billing. “How you coordinate session events and come up with a reasonable charge in real time will be a real interesting challenge.”
To understand how one’s organization will be impacted by IMS, Denny suggests the TeleManagement Forum’s eTOM (Telecom Operations Map) as a starting point.
“To know how IMS will impact you, you need a model. eTOM is a model that shows you how to think about IMS, to make sure [as you plan] that you cover all the touch points,” Denny said.
The promise of IMS
BellSouth will be well on its way in implementing IMS by next year on the wireless side of the business, but hasn’t established a timeline for the wireline side.
The primary reasons carrier, including BellSouth are interested in IMS is its promise of new services and services revenue as well the operational efficiencies associated with them and the fact that it is a standards-based architecture.
However, those efficiencies will come at a price. A big one, he said.
New research from Telegeography (see below) shows the 'burning platform' of delcining ARPU that wireless operators face.
This fits with our consulting assignments with operators who have been shielded from the ARPU decline by growth in subs. Another colleague tells me that this was a central point of debate at one of his fixed line clients yesterday, with only one OpCo claiming any improved ARPU (which, when analysed, was pure fantasy anyway). This trend is set to continue, but penetration in many markets is tailing off (and the ARPU decline will be all the clearer).
So, operators need to:
1. Increase ARPUs (or at least slow down the rate of decline) through new services
2. Reduce costs (because new services will incur new costs).
Either way, Operators better get going on IMS quicker than they are already. That means involving the marketing and operations functions much more closely in the planning process now. Let's move it out of the network architect's office.
In October's IMS Insider report we describe in detail which IMS-type services will be the most effective to stave off ARPU decline, and a rigorous framework for prioritising these (and other) multimedia services. We also describe a deployment framework showing what is required to get these services launched. To subscribe to IMS Insider, please go to http://www.ims-insider.com/. (We have a special offer of 25% in October).From Cellular News, 20th Oct, 2005 http://www.stlpartners.com/exchweb/bin/redir.asp?URL=http://www.cellular-news.com/story/14479.php
Quarterly Wireless ARPU Down Worldwide
Although global wireless subscribers and revenues continue to grow, mobile operators are seeing less and less revenue per user. TeleGeography's latest GlobalComms update shows wireless average revenue per user (ARPU) is declining worldwide, with only North American and Western European companies near their Q2 2004 levels. Eastern Europe was the biggest loser, down more than 27%, followed by Asia-Pacific and Africa, down 18% and 12% respectively. Global ARPU was down 13%.
Sample North American and Western European company ARPUs:
T-Mobile USA: $54 (Q2 2005) / $42 (Q2 2004)
U.S. Cellular: $44.50 / $47.80
T-Mobile Netherlands: $44.50 / $44.70
Telenor Mobil: $47.50 / $51.60
Sample ARPUs for the rest of the world:
NTT DoCoMo: $60.40 (Q2 2005) / $68.40 (Q2 2004)
Vodafone Australia: $37.70 / $44.20
Unefon (Mexico): $18.80 / $20.80
Will 3G Save Wireless Revenue?While ARPU continues to decline across the board for wireless providers, some 3G operations are beginning to report ARPUs much higher than regional averages. For example, Hutchison 3G UK reported 2Q ARPU of US$62 (compared to US$37.40 average for Western Europe), and its sister Hutchison 3G Australia reported US$61.80 (compared to US$18.90 for Asia-Pacific). Depending on the take up rate and price stability of 3G, global ARPU may see better days ahead.
Saturday, October 15, 2005
The table below shows the results of IMS Insider's (www.ims-insider.com) strawman survey at the IMS World Forum (see my last posting for more details). Delegates were asked to read through short descriptions of 22 potential IMS-enhanced services. They were then asked to choose their Top 5 from a short-list, which has been aggregated below.
1. Video Sharing 30 votes
2. Unified Messaging 29 votes
3. Single Virtual Directory 25
4. Unified Communications 23
5=. Click to Conference 22
5=. Net Meeting 22
7= Personal Assistant 19
7= Multiplayer Gaming 19
7= Friends & Family Tracking 19
10. Virtual PBX 18
Location-based profile match 13 votes
Security Monitoring 9
Field Force Efficiency 8
Logistics/Fleet Tracking/Mgt 7
Single Number/Dual Ringing 6
One-Device, Two-Number 6
Inbound call screening 6
Call completion 5
Intelligent Call Centre Routing 4
Multi-Channel Tele Voting 4
Group Hunt 1
See my last posting for the descriptions of these.
(NB: If you'd like more on this, please subscribe to the IMS-Insider. In October's edition of the monthly report we offer a rigorous analysis of how to prioritise IMS services and provide mini-case studies of what we believe will be the most profitable IMS-enabled/enhanced services, and how to realise the opportunity – http://www.ims-insider.com/.)
So, we thought we'd run a survey at the IMS World Forum last week.
My colleagues who run the IMS Practice at our parent consultancy, STL (www.stlpartners.com), created a short-list of 22 services that could be significantly enabled or enhanced by IMS (listed below). These guys know their stuff - they include an ex-CEO of a major European Mobile Operator, an ex-Marketing Director of another European Mobile Operator, an ex-Business Transformation Director of a US Fixedline player, an ex-Strategy Director of a European FMC company, and a consultant who previously set up a Mobility Centre of Excellence for one of the Big 5 Consultancies and also worked in Product Strategy for a leading NEP.
We distributed the list at the IMS World Forum last week (see below with a short description of each). This created quite a buzz. Delegates were asked to choose their Top 5 from the short-list. Over 60 people responded. The results are in my next posting on this blog.
This is, of course, not scientific, or rigourous, but the results may be interesting to readers of this blog.
For a much more detailed and in-depth analysis of the most profitable IMS services, do subscribe to 'IMS Insider' (www.ims-insider.com) where in October's edition of our monthly report we unveil a new methodology for categorising and prioritising IMS services, an 'Adoption Scorecard', a Deployment Framework....and case studies of what we think will be the most profitable Top IMS-enabled/enhanced services for operators. It goes without saying that our Top Services are based around Presence, LBS and VoiP and, for the consumer market, Multi-Player Gaming. We go into a lot more detail than I've seen anywhere else at present on how these services can be commercial successes for operators.
(Remember our October promotion - 25% discount on the annual subscription to IMS Insider, which means you get 12 focused monthly reports, monthly access to an 'Ask-An-expert' email service, and a quarterly deployment register - cost: £746 per person per annum! www.ims-insider.com)
Short-list of most profitable IMS-Enabled/Enhanced Services:
(NB: 8 of the short-listed services are primarily for business customers, 5 primarily for consumers and 9 could be for both business and consumers.)
On-demand conference call combining voice call with text messaging, application sharing, show-me-now photo and whiteboarding. Ability to add-in new attendees, hand-over control and save amended files/whiteboard.
Inbound call screening
Captures standard caller information (either from CLI/ID or if not available, through automated caller interaction) and presents this to called party for action
Single Virtual Directory
Directory of contacts (personal and/or business) accessed from any device. With optional gateways to public directories.
Multiple numbers (fixed, mobile, Instant Messenger ID, VOIPid) combined to behave a single logical number for all real-time communication services.
Single mail box for email, voicemail and other asynchronous messaging, which can be accessed through any device
Allow calls to be routed to a specified sequence of devices in turn.
Routes calls through a predefined sequence of contacts (e.g. Try to reach X first, then try Y then try Z)
Friends & Family Tracking
Allow predefined contacts or buddy-lists to see: That you are at Home, Work other 'base location'.
Single Number/Dual Ringing
Enable multiple devices to be called simultaneously. User can chose to use any device to respond (or reject call).
Two numbers to manage different groups of contacts (e.g. Personal vs. Business Contacts). Multi-profiling through multiple devices/networks.
Click to Conference
Instant conference with a predefined attendee list. Attendees are connected from any network/device.
Real-time gaming between 2 or more players, potentially through different devices/over different networks.
Presence management and messaging through configurable rules linked to diary (e.g. During a meeting, I am "busy" for anyone other than my boss).
If a caller is unable to reach a party, caller initiates service that will detect when the called party is available, then contact the caller, who in responding, re-initiates and completes the original call (e.g. BT "press 5" service)
Multi-Channel Tele Voting
Interactive entertainment services that allow real-time feedback through any device
Location-based profile match
Subscribers enter profiles / interests and those they are seeking. Matches are made based on profiles and proximity. Subscribers can then make contact using service (through pseudonym). Includes business applications such as trade fairs / conferences.
Detailed location information presented against assets/individuals
Field Force Efficiency
Real-time location information integrated to field force (sales, service) management to minimise travel distance and transit times
Provides PBX functionality across and between multiple devices and networks
Intelligent Call Centre Routing
Provides complex rules-based routing of inbound calls to mulitple terminations (time of day, follow-the-sun, load balancing, originating caller routing, IVR-based call routing, group hunting, disaster recovery (pre)-configurations)
Integration of video clips into a voice call, where both parties can view and discuss the video
Access to web-cam (video and controls) from any device with appropriate screen.
Questions/comments: email me at email@example.com
Friday, October 14, 2005
I'll be posting a series of commentaries on what was presented and discussed at the event over the coming week.
Also, the results of our survey on what the delegates felt are the most important IMS-enabled/IMS-enhanced services that operators should focus on creating. This was the big question at the event...
We were extremely pleased by the reaction to our 'IMS Insider' (www.ims-insider.com) service (of which this blog forms a part). A question we were asked repeatedly by IMS practitioners we met at the event was: "How come you can launch a service that gives subscribers 12 high quality monthly reports, plus an 'Ask-an-Expert' email service, plus a quarterly IMS Deployments Register for £995 GBP...per annum! Normally that's the price of a one-off report, which is out of date as soon as we get it!"
The answer was/is that the 'IMS Insider' service (supported by this free blog) is not how we make our money. The practitioners at our parent consulting company, STL, are working with Operators and Vendors every day on IMS and related 'business growth issues'. We kept hearing that there was a need for something regular, authoritative and laser-focused on the question "how, practically, can we make money out of IMS?". So, IMS Insider was born in early September.
Since then we've been overwhelmed by the response from around the world and already signed up a significant number of individual subscribers, as well as companies who've taken global licenses for it. The annual subscription fee essentially covers our costs of production (and, for those who are interested, we have a promotion till the end of October which makes it only £726 GBP per annum (25% off). See www.ims-insider.com if you're interested.
In the meantime, I can wholeheartedly recommend Informa IMS conferences, which are without doubt the best in the world at present.
Their next IMS conferences:
- Analyzing the Business Case for IMS/MMD Deployment and Implementation - 7th - 11th November 05, Dallas http://www.telecoms.com/imsmmd
- IMS Asia - 21 - 22 March 2006
- The 3rd IMS World Forum 2006, 25th - 27th April 2006, Barcelona http://www.telecoms.com/ims
A big thank you to Davide Bonomi and team at Informa who are creating such impressive educational and networking events. We looking forward to continuing our partnership with you!
Saturday, October 08, 2005
Operations Director (OD): Everyone likes to focus on new revenues and new applications for business cases, because this is positive and exciting. Cost reduction tends not to be the main emphasis, yet this will probably end up being the main driver for IMS. And we are not just talking license costs or power costs.... we are talking people costs.... and not just operations people, but also support functions.
Mobile (and for some time already, fixed) operators will see revenue growth slow and stagnate (in real terms, this is happening already, with many mature markets barely growing above inflation). Operators will continue to add new services and gain share of traffic and services from other sectors, but falling prices on the core business will largely nullify this. Many new services will be bundled into existing packages to retain customers (more services for the same price). Developments in new services will need to happen in Internet time (see Google or Skype functionality release schedules).
Essentially, operators will be running harder... to innovate and respond to endless competitive challenges (both from within the mobile industry and from outside it).... running harder and harder, just to stand still. The task of securing profitability through service is being made impossible through the lack of time for services to make money.
So, yes, new services will be important, and yes, it will be important to deliver these faster, but it will be critical that this is done at a much lower cost.
Essentially is this about an Apple model or a Dell model? Both successful, but for very different reasons: Dell cuts costs, Apple creates completely new things. To do a Dell, you need IMS, to do an Apple, you probably don't.
Marketing Director (MD): I agree...but only to an extent. Yes, the IMS business case can probably be made on the basis of cost savings BUT cost savings can only be half the story for operators.
Cost savings can only provide earnings growth for a limited period - you get the gain but you can't keep getting incremental gain year on year because you can't cut costs for ever (there is always a floor below which you fail to either invest properly in business OR operations fall over). IMS certainly gives this benefit but it also opens up operators to sustained revenue growth - the only way to drive shareholder returns in the long-term. This revenue growth also has a ceiling but it is a much higher one that the equivalent floor for costs because you can (a) grow overall market and (b) win share from competitors in a multi-multi billion dollar industry.
Cost savings are probably going to be used to justify investment because it is much easier to quantify savings than revenue growth, but new revenues (even if they only offset price erosion on core voice services) are also critical.
OD: The case for revenue growth from IMS (or anywhere else!) is weak. Let me present some evidence. Vodafone recently presented a view to the analyst community of how the telephony market in core European markets will play out. Now, I buy that mobile will continue to eat into fixed but I do not believe that Mobile Data will grow so fast that it will actually increase the telecommunications market’s share of GDP! They are suggesting that Mobile Data in 2010 will equivalent to 50% of the mobile telco market today!!!
Now here is a dose of reality – this is actual ARPU performance in the major European countries and in Japan – I have added Japan because it is way more advanced than anywhere else and shows the way other countries will go:
Bottom line is that the mobile world is in for some big pain and it needs to learn how to be nimble and cost-effective from other mass-market technology companies such as PC manufacturers. Service innovation is not going to get you out of the hole.
MD: Hang about. If we look at
OD: Interesting definition of healthy growth. I usually associate a growth trend when the bars get bigger over time! These ones appear to be getting smaller. Looks like these chaps are running harder but still going backwards. Perhaps they are driving costs down faster and so increasing earnings?
However, my point remains that were you to show NTT Docomo’s quarterly ARPU evolution since 2002, we would have a more valid comparison. £10 says that Docomo’s Arpu have fallen since 2002!
MD: But new services don't just drive usage & price (ARPU) they drive adoption too - new services have been one of the key reasons why Vodafone