07 July 2017
| Guy Matthews
Wholesale telecoms is starting to explore innovative ideas that break with decades of traditional thinking. Guy Matthews investigates
Wholesale telecoms is embracing innovation with enthusiasm
as it bids to consign a sometimes merited reputation for
unadventurous and conservative thinking to the history
"Wholesale telecoms doesn’t exactly have a name
as a hotbed of innovation, certainly not at the pace in which
it happens in the consumer segment or even in enterprise
business," says Eric Bozich, vice president of product and
marketing at US-based CenturyLink.
In Bozich’s view, the need for innovation is
arguably more acute in wholesale than in those higher profile
parts of the communications ecosystem: "Wholesale will simply
have to evolve as fast or faster compared with the more
glamorous sectors to be competitive going forward," he
believes. "The need to support escalating bandwidth
requirements combined with end-to-end security, accommodating
real-time application-driven changes, are some challenging
requirements." Wholesalers, he says, are challenged by the fact
that much of what does pass for radical thinking in their
industry happens under the covers, less visible and not as
widely reported as advances in other areas of telecoms. "And in
wholesale, we have to do everything at scale, from the get go,"
There are plenty of signs that whole-salers are divorcing
themselves from an outlook and a service portfolio narrowly
rooted in infrastructure alone, and are busy transforming
themselves into more software-led organisations. In this
respect they are playing catch-up with what the rest of the ICT
sector has been doing, with its emphasis firmly on an
automated, on-demand, pay-as-you-go, data-driven,
intelligence-led, virtualised ecosystem.
There is evidence that pace setters are developing a mindset
more akin to a Microsoft or a Google than a traditional telco.
And it’s in the software-defined wide area network
where this is clearest. "We’re seeing
announcements come out almost every day around SD-WAN," says
Karim Eljai, senior director of NTT Com’s global
enterprise network business unit.
He points out that his own organisation just launched the
world’s largest SD-WAN footprint, covering over
190 countries in the form of its new SD-WAN Service Portfolio.
"It’s a game-changer in terms of coverage and
performance," he says. "What’s also new about it
is that we have a whole suite of security products available
from the cloud. Customers can set up a firewall perhaps with
some malware reporting capabilities directly from our portal,
with no need to invest in any hardware at their branch
Orange International Carriers has also got a pipeline of
innovation coming to fruition in areas like Wifi roaming, cloud
and security, says Frederic Dufal, responsible for strategy and
customer experience with the carrier.
"For example we’re making the cloud services we
sell through our business division available to our customers,
where they can sell it as their own service," he explains.
"We’re also having success with our innovative
DDoS protection offer. It’s an exciting area,
because whatever you do in security you need to renew all the
time. To this end we’ve been acquiring a lot of
cybersecurity expertise in areas like SS7."
Orange’s perspective takes in both the highly
evolved markets of Europe and the less developed arguably but
more dynamic economies of Africa and Asia. Dufal is excited
that innovation is being trafficked in both directions.
"We have seen innovation in Africa which we have then
transferred to Europe, for example in the field of mobile
payments," he says. "We’ve been very successful
with that across the continent, and now we’re
launching banking services in France that leverage that
Diversity in innovation
He says that conversely the radical progress Orange has made
in Europe in the area of lower latency is now being exported to
other parts of the world: "We have R&D going on in Africa,
Europe and also in the US and Asia so we can benefit from
wherever the new ideas are coming from," he says. "Diversity is
a very important fuel for innovation."
CenturyLink’s Bozich agrees that radical
thinking is no respecter of borders or degrees of economic
development: "I look at who participates in some of these
standard bodies, and it’s truly global," he says.
"There are people in wholesale all over the world contributing
open source technology that’s going to help make
the virtualised network environment real. Yes,
there’s a lot of big investment in North America
and Europe, but the playing field of innovation is more level
than it was."
Innovation can often be a marriage of new thinking on both
the technical and commercial aspects of a carrier business.
Jerzy Szlosarek, CEO of Singapore-based wholesaler Epsilon,
believes his company is breaking new ground in what he defines
as the "platform economy". "Our service model is really leading
the way in terms of on-demand connectivity, automation,
intelligent networking and overall user experience," he claims.
"Our Infiny platform gives our customers and partners the most
comprehensive set of services available via a web portal, and
APIs with truly global reach."
He agrees with Bozich that much wholesale innovation is all
but invisible to the consumer or the enterprise, but that does
not mean it matters less.
"This includes things like the intelligent networking
technologies we’ve built into the underlying
network that enable us to offer guaranteed QoS and QoE
end-to-end," he says. "That means apps and services work
consistently and end-users get a consistent experience."
The push for digital transformation and that is gripping the
enterprise sector also has its equivalent in wholesale
telecoms. The drivers are the same: to improve operations,
modernise the business, reduce costs, and to make it easier and
more cost effective to deliver services to customers.
"Essentially it’s about how to offer more for
less," says Mark Lewis, vice president for products and
development at European carrier Interoute.
"Add to this the desire to make it easier for employees to
collaborate and improve customer engagement and it becomes easy
to understand why innovation is essential for any organisation
that wants to stay in business."
But the nature of the challenge can be very different for a
large carrier business with a long history. The particular
problem for wholesale carriers, argues Lewis, is that in many
cases they still operate old infrastructure that is expensive,
unintegrated and often unreceptive to change.
"It’s a little bit like the London Tube system.
It was one of the first underground railways in the world,
admired by all for its innovative approach to transport, but
those who built later, built better, with more advanced
technology and greater automation," he says.
"Fast forward to today and you have an old infrastructure
that does an amazing job but is hard to change and update with
the latest innovations."
So where is the next wave of wholesale innovation coming
from? From those carriers that stay focused on progressing a
cloud-centric business model, says James Slaney, co-founder of
cloud call recording and voice intelligence company
"The most successful innovators in the carrier sector will
be those which embrace a native cloud model, providing telcos
and end user organisations with an API as a product so all
complementing actors can integrate, scale, automate and
innovate new use cases that would benefit the telcos, vendors
and the end user," he says.
The telco cloud will be a combination of a virtualised and
programmable network, courtesy of SDN and NFV, and the
transition of OSS and BSS services transitioning to cloud and
SaaS applications, while additionally leveraging DevOps
methodologies, believes Joerg Koenig, director of the global
vertical group at Tibco Software, a supplier to the telecoms
"In real terms, what this means is a transition away from
the traditional linear pipeline to the platform business model,
leveraging the API economy and ecosystem of partners," he
"While this is easy to say in a couple of sentences, it is
radical in terms of organisation, architecture, business models
and the inevitable hybrid environments that will exist for many
The successful wholesaler of the future will be both
cloud-centric but will also need to stay focussed on
infrastructure, as it is the wholesale sector ultimately that
provides the plumbing than underpins the world’s
Wholesalers must be good at everything from fibre to
security to software, seldom acknowledged even where they are
learning to lead the way where once they were happy to