Innovation: the key to staying ahead
Big Interview

Innovation: the key to staying ahead

Innovation isn’t simply about bringing new and different services to market. It needs to touch every facet of a company’s activities in order to truly have an impact.

Juan Carlos Bernal, CEO of Telefónica International Wholesale Services explains “This is why Telefónica’s strategy and business model is built on an innovative approach that permeates all parts of our organisation, including our Wholesale business”.

Telefónica ’s vision to be an OnLife Telco means empowering people to choose how to improve their lives and take control of their digital profile. In today’s digital world, everyone and everything is connected, and the connectivity of all our devices is resulting in an explosion of data.

“Telefónica is building a data-driven company to be at the forefront of this new revolution. To achieve this, we are improving each of our assets and combining them in a four platform approach which gives customers control over their digital life. From a wholesale perspective we want to be a digital enabler along our customers’ journey and leverage all of our core strengths to deliver the best for those that entrust us with their business”, says Bernal.

The best connectivity

The first platform is made up of our network and physical assets, such as data centres. Our network generates a large amount of data, with more than 3 exabytes of data per month flowing through our networks. These physical assets are also at the core of delivering outstanding connectivity and it provides us with a differential advantage able to facilitate and meet the demands of the continuous growth in data traffic. 

“Our commitment to our infrastructure is clear. Since 2012, the Telefónica Group has invested 38,000 million euros in the development of our fixed and mobile networks, an investment which enables us to continually enhance our ability to deliver for our customers”, Bernal says. 

As well as making significant investment in the deployment of high-speed fixed and mobile broadband, we have also focussed our efforts on using software-based services to deliver better experiences to our customers. “We are creating new Network Functions Hubs in the Americas, Europe and Asia and developing Virtual Network Functions on them which are controlled by a service orchestrator”. According to Bernal, this is another huge strength that can be passed to customers. “By moving from vertical architectures built over many networks and technologies with wide geographical spread, to simple and scalable architecture with shared infrastructure, we can deliver the best quality to our customers”.

Digitising systems to become a real-time company

The second platform consists of our support systems and commercial systems, linking the data generated by the first platform with the business component and processes that run across our business. 

Software is playing an increasingly important role in connectivity solutions and the transition to Network Softwarisation is transforming how services are deployed, delivered and, most importantly, used by businesses and consumers. It connects the other platforms, enabling us as a real-time, automated and customer-oriented company. According to Juan Carlos, “the softwarisation of the network and services is one of the biggest challenges facing wholesalers today”.

However, it also presents greater opportunities to enhance customer experience, and achieve efficiencies through end-to-end digitisation, both of which are key factors for business success. Juan Carlos explains, “My expectations for the ongoing impact on the Wholesale market are focussed on 3 areas: the simplification and improvement of our current service portfolio, making them automated, easy to order and manage; the introduction of new services based on the new virtualisation model, and finally, the need for us to redefine our existing relationship model with customers and providers”.

One of the most important initiatives that we have developed in this area is to put in place a Fullstack system which comprehensively covers from a portal or API to the interface with our customers, to the BSS, OSS and the automation of the network. “We believe this will ensure we are strongly placed to continue to evolve our service, confident that our simplified and homogenised processes and IT & operating systems will support their deployment” says Juan Carlos.

Integrated portfolio providing better experiences

The third platform recognises that delivering the best products and service platforms is vital, and builds on the capillarity of our physical assets and systems.

Bernal explains that one of his priorities in 2017 has been to revamp the product and services value proposition. “We are focused on 3 strategies: driving efficiency in legacy services, promoting growth in the core services, and boosting digital services”. 

“It is important that we don’t overlook the more mature services in our portfolio. To create efficiencies for traditional business including voice, roaming or VPNs, services that are seeing increased traffic but lowering revenues and margins, has forced us to employ new technologies such as IP NGNs, virtualised infrastructure or, where appropriate, migrating the traffic to IP/IPX”.  

He goes on to explain “by developing new service revenue streams over existing services like SMS A2P, VoLTE or HD Voice, WAN2Cloud, Clean Pipes, or even value-added roaming services and new platform services over MPLS, like SIP Trunking and Unified Comms, we are able to build on our core strengths and differentiate ourselves from our competition”. 

During this year, we have added a set of mobility value-added services over IPX, a technology where we have taken a lead since its inception, including Real-Time Subscribers Engagement, Location Based Services, Data Usage Control, Sponsored Data and Data Optimisation, opening up new revenue opportunities for operators. Juan Carlos explains  “There is huge potential in IPX in the future. We’re committed to continual innovation to ensure we stay at the forefront of the development of this technology and that our services are ready and fit for purpose, to capture all new opportunities”. 

New services demonstrate our digital ambition

Juan Carlos Bernal believes strongly that offering a new digital portfolio, alongside traditional services, will positively enable the successful expansion of our customers’ product and service set, without the need for huge investment, and is key for future growth. Telefónica’s wholesale portfolio of new digital services and platforms which support Cloud, Security, Big Data and IoT, among others, have been successfully deployed in our own operating businesses. Now other Telcos can take advantage of our experience and expertise, and in the same way that traditional wholesale services spread value among operators worldwide and assure interoperability, new services require wholesale players to be enablers and value brokers. 

Telefónica  is also a leading player in satellite which completes a wide portfolio of different connectivity technologies, enabling us to provide an all-around approach in terms of coverage and combined service solutions. We have a particularly strong presence in Latin America, managing the largest wholesale satellite infrastructure in LATAM, and offer full coverage in our footprint on Ka and Ku band for VPNs and maritime transport.  “Having our own satellite division and satellite infrastructure, is an important differentiator for Telefónica” explains Bernal.

Leveraging the power of data

The fourth platform is the ecosystem which connects data, devices, networks and people. It is this cognitive power that brings together Big Data from internal and external sources to empower not only our own business, but our customers’ businesses too.

Telefónica has invested significantly in Big Data, as we consider it to be critical for the future. Our commitment has not just been with platforms but also in the way we operate, with the creation of LUCA, our new Big Data Unit, launched in 2016. 

Our Big Data innovations include Smart Steps and Smart Digits. Smart Steps has become a worldwide reference on how, by using anonymised and aggregated mobile data, we can deliver valuable insights which help decision makers shape their strategies around actual behaviour and ultimately improve their propositions and businesses. Smart Digits is a new offering which puts privacy back into customers’ hands, protecting them from fraud, for example when using an ATM or paying with a credit card when abroad. 

Juan Carlos explains “we have also applied our Big Data capabilities in our operations and across our traffic in order to analyse and better understand usage patterns and traffic demand. This is proving to be an invaluable tool to improve our customer care”.

Looking to the future 

Bernal is mindful that innovation must be constant, especially in a mature business like wholesale. “Just like our IT, product and technology partners, it is important that we continue to innovate and evolve in order to ensure that our customers continue to choose us as their partner and to ensure a successful and profitable business for years to come”.

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