International telecoms is one of the world’s fastest-changing sectors, calling for carriers to be agile and collaborate. Rolf Nafziger, SVP at Deutsche Telekom Global Carrier, reveals to Capacity how new innovations in the industry in areas like 5G, cloud and AI require real focus to rise to the challenge.
What are the most pressing industry needs and challenges for market players to address?
I see a massive and unstoppable trend towards accelerated globalisation and digitalisation within and beyond our industry. Markets are changing rapidly, and our industry is dealing with major challenges.
Enterprises – even at the scale of small to medium-sized businesses – continue to produce and source across the world, meaning that global connectivity is more important than ever. More and more business processes are also being digitalised, including critical ones, and require such connectivity.
Artificial intelligence is swiftly on the rise and the metaverse is still on the horizon, following the latest developments in virtual- and augmented-reality applications. These, in turn, require a high level of capacity or adaptive bandwidth, quality of service [QoS], network APIs and other next-generation connectivity services.
In addition, I see an unstoppable trend that what can go to the cloud will go to the cloud. This includes 5G standalone [SA] core networks, as well as compute and storage data, making security and redundancy a lot more important.
These developments bring about massive change for our industry. The world is turning upside down and we also need to therefore turn our industry upside down. Our partners and customers demand quick and decisive action from us and our industry as a whole.
What are the most important customer requirements that you see evolving?
Customers increasingly demand everything-as-a-service, whereby all digital services provided are subscription-based, instantly available, configurable and offered in a pay-as-you-go manner without large commitments – such as Amazon Web Services.
Another must-have is the provision of QoS guarantees for both domestic and international cross-border services. This is because a ‘best efforts’ approach in roaming, for example, is no longer sufficient for many use cases.
As apps and network move closer together, customers want app-driven, dynamic management functions that allow end users to request higher capacity, low latency and more by simply pressing a button on an app. Automated and trusted business processes have become a necessity, covering services such as quoting, deployment and delivery, settlement, and payment in a multi-carrier environment.
B2B customers also need cloud and multi-cloud support as they move production systems, telephony and other activities into the cloud, and have to accommodate internationalisation and hybrid work environments.
How is the role of the carrier industry changing and what key capabilities does it need to bring to the table?
I see four roles on which we have to focus to successfully turn our industry around: we must be aggregators and simplifiers; enablers; efficiency drivers; and, last but not least, innovators.
Taking each of these in turn, first, we need to aggregate individual footprints, while at the same time simplifying global connectivity across those footprints. Second, we have to enable international connectivity for all business-to-business and business-to-consumer use cases, thereby empowering business globally and providing a high-value service for national economies. Third, as efficiency drivers, we want to resell capacity internationally so its use increases.
Finally, the carrier industry provides the backbone of the internet, so our fourth role is to stay at the forefront of innovation so we can continue to cope with different demands, use cases and developments. One example is the metaverse that everybody’s talking about: without the carrier industry supporting it, there won’t be any metaverse.
The capabilities we need to offer are a hyperscaler-like user experience, a global presence, consistent QoS with telco-grade security, and scalable, customisable cloud-native solutions. We also need to enable API-based architecture with scalable integration of telco services into new business models, and end-to-end security with solutions that are adaptable to dynamic network risks.
Last, we have to be network-agnostic, ensuring service delivery over different network infrastructures.
From where do you see the biggest competitive threats to carriers emerging?
In the international context, other carriers are not the only competitors any more, with hyperscalers and aggregators becoming new and very dominant ones. These players, which possess global reach, have increasingly entered telco domains. Their growing portfolio here includes cloud-based communications services like AWS’s Amazon Connect contact centre, collaboration services such as Microsoft Teams, 5G core networks, private 5G networks, and more.
From the process and software side, meanwhile, a competitive threat comes from cloud-native companies, which have a high degree of automation in configuration, delivery and SLA processes. They are also highly scalable due to the virtual services they use, which make new business models such as infrastructure-as-a-service possible. Last, low-Earth-orbit satellite companies are effective in providing low-latency connectivity in remote areas, as well as IoT connectivity.
How can carriers fend off the competition moving forward?
With developments in network APIs, carriers have a new chance to re-establish themselves on the competitive landscape. Key requirements for future success will be to better work together, establish common technical and commercial standards, and have fast go-to-market strategies. Building creative business models, as well as investing in developers and IT in general, are also musts.
No carrier can fulfil every customer requirement on its own. All have their specific footprints, in particular when it comes to network APIs. Collaboration is therefore imperative to meet customer needs for globally available, adaptive bandwidth with QoS, and fast ordering, delivery and monitoring.
The current lack of common standards for ordering, delivery, settlement and many other processes, however, makes this a challenge compared to hyperscalers with global greenfield IT infrastructures. This means that while engaging in industry bodies such as the Global Leaders’ Forum [GLF], Communications Business Automation Network [CBAN], MEF, CAMARA and the GSMA may cost money and resources, there is no alternative to driving this transformation and gaining the competitive edge in the medium to long run.
In which collaborative efforts does Deutsche Telekom Global Carrier participate?
In our current upside-down world, where we’re facing the most challenging times ever, we at Deutsche Telekom Global Carrier want to be seen as a stable force and innovative partner for our customers in any situation. We’ve done lots of work in the past year moving forward in important areas and are engaged in different roles with all the organisations I just mentioned.
We’re leading a GLF project on critical IoT service-level agreements together with our partners Telefónica, PCCW Global and Orange. We’re also engaged through CBAN in creating interoperable, trusted and secure data flows by applying blockchain technology, as well as within a data-on-demand project involving Colt, PCCW Global and Vodafone, and within commercial roaming. As part of an MEF working group, we’re implementing Sonata APIs linked to lifecycle service orchestration for an ordering process called e-bonding 2.0.
On top of that, we co-founded the CAMARA Alliance within the Linux Foundation to create a technical standard for network APIs, and are part of the GSMA Open Gateway projects for creating commercial standards for network APIs. We’re also very active in the Hand-in-Hand [hi-H] Program, an amazing initiative that covers mobile, data and innovative telecoms technology.
How else are you aiming to guide the market’s development?
A notable example is our innovative environment to support early movers that want to test the transition to 5G roaming. New 5G standalone [SA] networks bring significant changes to roaming, because the new mobile generation is the first that facilitates end-to-end security from day one through ‘built in’ controls. The related specifications will redesign the way in which roaming works today, leading to significant benefits but also more complexity.
Here, we offer customers the possibility to outsource the investment and operation of 5G SA roaming enablement to us. Our various security edge protection proxy [SEPP] capabilities allow secure interconnect, ensuring end-to-end confidentiality and integrity between source and destination networks for all 5G-interconnect roaming messages.
Through these pioneering services, as well as our various initiatives with partners and industry bodies, we want to further increase the potential for collaboration between different stakeholders, including telecoms operators, cloud providers and end users. Such cooperation will enable new and innovative use cases, and ensure a prosperous future for the telco industry. I encourage anyone interested in joining us during these exciting industry transformations to get in touch.
