27 April 2018
| Alan Burkitt-Gray
Carl Grivner, Colt CEO, and Mike Van Den Bergh, the CMO of PCCW Global, talk to Alan Burkitt-Gray about their pioneering trial of blockchain for inter-carrier settlement of voice minutes, and where this proof of concept may lead the wholesale carrier industry
Carriers could use blockchain for a whole new range of
services – even to start a currency that companies in
the wholesale industry could use to pay for the services they
buy from one another, says Carl Grivner, who’s
been CEO of Colt for two years. Sceptical? "Fifteen years ago
people were talking about the cloud just as people are talking
about blockchain today," he says. "But, now, people are
starting to study blockchain and its impact."
Capacity announced in March that Colt and PCCW
Global have started trials to see how blockchain can speed up
time for inter-carrier settlements and make them more reliable.
The proofs of concept they have carried out so far indicate
that blockchain can cut inter-carrier settlement times from
hours to minutes.
It’s early stages, says Grivner. "The
settlement test with PCCW Global is a baby step." What will
follow? He already has a list of possibilities. "The most
exciting of them is cyber security."
The whole blockchain project has emerged from the Global
Leaders’ Forum (GLF), created by the top industry
executives who a decade ago approached Capacity Media to start
International Telecoms Week (ITW).
The GLF meets several times a year at major industry events.
"We came up with the idea at Capacity Europe at the end of
October 2017," says Grivner. From there to a working proof of
concept took just four months, he notes.
The third partner in the project is a Singapore-registered
blockchain start-up, Clear, whose CEO, Gal Hochberg, had
already worked with Marc Halbfinger, CEO of PCCW Global, the
international arm of Hong Kong’s HKT.
Benefit the sector
Halbfinger chairs the GLF, which aims to foster an
environment within the industry that focuses on ubiquity,
collaboration and interoperability between providers. This
proof of concept was centred on these themes by attempting to
understand how a technology such as blockchain can benefit the
sector as a whole.
"I applaud Marc for his lead on this," says Grivner.
Its power for the wholesale carrier industry is that for
decades the process of reconciling records and settling debts
has been laborious. Blockchain technology, it now seems clear,
can make inter-carrier settlements more efficient, reliable and
"This is something that normally takes months," says
Grivner. "It’s not just the reconciliation of
records but also the reconciliation of discrepancies."
The blockchain trial by Colt and
PCCW Global shows that it’s possible to reduce
inter-carrier settlement times to minutes using blockchain
technology. It’s not just more accurate but "it
means better cashflow", says Grivner.
Already he and Halbfinger – along with the rest of
the GLF – are looking for ways to move beyond the
first proof of concept, which involved voice minutes, largely
because that was a well understood service provided by most
"Maybe a cryptocurrency," he muses. "It could be used by
telecoms carriers and maybe even by customers. Marc and a few
others have talked about the creation of a cryptocurrency."
Blockchain is best known, so far, as the engine behind
Bitcoin, the cryptocurrency whose fluctuations in price have
led to comparisons with Amsterdam’s tulip bubble
of the 1630s. But whatever people say about the viability of
Bitcoin and other cryptocurrencies, some are starting to
realise that blockchain could have important business
applications – and telecoms is just one of the
Not just bill settlement and security uses, and not just the
idea of a crypto-currency. "There are a lot more examples,"
says Grivner. "The idea is to enrol more applications in the
blockchain – not just settlement."
What’s the next step? "Let’s
enlist others industry-wide to look at some of the other
applications, such as security." Because blockchain is a
distributed ledger, it’s almost impossible for one
individual or company to create fake entries.
"Blockchain has raised the cybersecurity bar," he adds. "It
could be used for email, billing and other applications." The
mobile industry should find applications in roaming, he notes.
"Ultimately I’d like to see the technology in our
Using blockchain for settlement in the wholesale carrier
industry can reduce cost, improve operating efficiency and
improve cashflow. But for the real value to be recognised, the
entire industry needs to embrace the idea, says Mike Van Den
Bergh, chief marketing officer of PCCW Global.
Van Den Bergh adds: "It is a value tool between ourselves
and Colt. Right from the start we’ve got to be
open and inclusive. We need to have minimum barriers to entry.
The object now is to promote a new way of working. It has the
potential to transform the whole industry. The value will be in
inclusivity – so everyone is working on a common
Until now the industry has used conventional methods to
record the transport of voice minutes – and other
traffic – across each other’s networks.
In the trials, Colt and PCCW Global implemented a bilateral
private blockchain to record transactions, which were then
reported to a public blockchain. Smart contracts were used to
rate call detail records, resolve disputes and record the
Levels of trust
"The industry is a success because of the levels of trust
between companies," says Van Den Bergh. "Blockchain helps to
reinforce that. It offers new and more effective ways to
Voice minutes were used in the trial "because most players
have a common set of rules", he notes. "The nice thing about
wholesale voice is that most carriers work in exactly the same
way." It made sense for the trial to work with existing
processes "and just apply blockchain", he adds.
Blockchain is a distributed ledger system, with multiple
copies of files making it virtually impossible to distort the
For the trial, Colt and PCCW Global used a combination of
private and public blockchains, says Van Den Bergh. "That
creates a level of resilience. It takes away the need for
If the GLF and the wider industry want to adopt blockchain
for all transactions, what confidence is there that the system
will be scalable? One of the most famous uses of blockchain so
far is Bitcoin and other cryptocurrencies, but they need so
much processing power that they are unsuitable for small
"That’s the advantage of taking a private and
public approach," says Van Den Bergh. Transactions between two
companies can be made on a private blockchain, and then the
overall ledger is replicated on the public blockchain.
The next stage is for a larger number of carriers, working
through the GLF, to do further proofs of concept. "Everyone is
already talking about blockchain and knows it is a good
The trial at the start of this year used live data, so the
two carriers could compare the results from blockchain with the
results using the traditional way of working.
"Normally it involves large numbers of people and days if
not weeks," says Van Den Bergh. "But we were doing it in
seconds. This immediately speeds up settlement." Often the
delays are caused by lengthy reconciliation and dispute
procedures. Blockchain offers the potential to automate that,
using what Van Den Bergh calls "smart contracts".
The project has already "captured the imagination of the
industry", he says. "We have had more and more people knocking
on our doors, even people from outside the GLF."
For smaller players, he adds: "The real value will be
created when the entire industry is working in the same way.
Collaboration is a natural function of how the industry
A public blockchain "will accommodate every player including
the smallest, and they will decide when to implement private
blockchain". The key, he says, "will be to make it attractive
enough, so that the amount of investment will be small. We are
starting to think about the business model."
And Van Den Bergh echoes Grivner’s suggestion
that a later step could be a cryptocurrency that the industry
would use for its settlements.
"It’s an obvious evolution of the model," he
adds. The currency would be convertible into standard
– or fiat – currencies. But what would it be
called? Among the latest suggestions: the Carl or the