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June 1, 2000
Are You Ready for Virtual Distribution?
By James Olsen
It’s no secret the rush to jump on the IP bandwagon fuels the unprecedented rate of change in today’s communications industry. Less obvious is the impact IP technology has in making distribution as virtual as the networks and services delivered. Subscribers want instant access to different kinds of communications services that are low cost and reliable. How today’s network, service and ASPs respond to the challenges of managing their services and networks within this new virtual distribution model is as critical to their success as their ability to assimilate and manage technological change.
Despite this shift to managing dynamic service to customers, many providers still rely on outdated, inflexible systems that were designed to handle static processes and created with low-level programming. While these applications let providers provision the network or manage network devices, many depend on error-prone manual and paper processes. These solutions offer little toward improving control of ever-changing services.
Enter Virtual Connectivity
The virtual distribution model reflects consumers’ growing appetite for bundled services.
Diverse companies–access and transport providers, ISPs,
CLECs, revitalized RBOCs, huge banks, investment brokers and “dot com” content providers–now interact in ways previously unimaginable. Their mission is to provide high-speed connections.
The resulting blend of network, service and ASPs has created an extended supply chain serving subscriber communities through complex links and interactions. ISPs such as Frontier Global Center Inc.
(www.globalcenter.com) have expanded from providing simple network operations center
(NOC) collocation to managed services such as web hosting. Meanwhile, cable television companies like Time Warner
(www.timewarner.com) are cashing in on their ability to provide access to high-speed data transmission, and ICPs such as AT&T Corp.
(www.att.com) are buying them up to hedge their technology bets.
Virtual connectivity has raised the expectations of customers who yesterday were content with reliable access to service and separate billing from carriers. Customers expect fast, reliable connections, simplified access, lower costs, the convenience of one-stop-shopping.
The path to profitability is get the customer, keep the customer, keep the money. As customers and services have grown, telecom profits have eroded disproportionately by open competition, regulatory requirements, mergers and acquisitions, higher costs, a shortage of skilled personnel and demand for new technologies. Many providers must manage complex operations, diverse services and business processes with fragmented systems and manual processes.
Companies that have merged networks and services are burdened with time-consuming duplicate processes, systems and personnel. The hidden costs of updating unintegrated management systems include additional training, programming and multiple system upgrades
(see chart below). Offering services in a virtual environment intensifies the problems.
To generate additional revenue and sustain profitability, providers must extend the value of their investments in new technologies and markets. To keep customers loyal, converging providers must continue to add new services and features–and that costs money.
Providers also must protect profits by learning to manage resources in new ways. In the rush to compete with cable companies, incumbents have to deploy services like DSL much faster, with shorter deployment cycles.
In an era of virtual distribution, the only way providers can keep customers and the money is through better control of
OSSs. Marianne Wolk, a financial analyst who follows the industry for Robertson Stephens
(www.rsco.com), contends that converging providers will rise or fall by whether they acquire eOSS, which she defines as next-generation OSSs that enable advanced billing and network traffic analysis for IP-based services.
Providers face an even tougher challenge than provisioning and monitoring multipurpose packet-based networks: integrating and managing all their resources cost-effectively.
Poncy, director of Global OSS, Unisys Corp. (www.unisys.com), “Providers currently rely on a patchwork of systems, with no single OSS application that can successfully combine network operations with both back- and front-office functions.
State-of-the-art unified management systems represent a solution to the OSS crisis that supports current and future technologies and business processes. By accommodating new technologies and protocols, an open OSS offers the flexibility to expand rapidly into new markets and scale systems and services to market needs.
This innovative approach to handling change in a virtual environment unifies a provider’s management systems by integrating and automating the management of networks, services and even business processes. Using this open infrastructure of frameworks and management applications, providers can plug in other systems through a combination of open APIs, support for standard and proprietary protocols, and intelligent gateways. Through the ability to integrate best-of-breed systems for order entry, service activation, billing and more, providers can eliminate costly duplication and achieve end-to-end data sharing and process control.
When based on object-oriented design and newer technologies like common object request broker architecture (CORBA) and JAVA, this approach eliminates the need for complex programming.
Using object-oriented design and graphical tools, providers can accommodate changing needs and equipment by modifying applications for managing service delivery, assurance and usage. A set of ready-made object definitions makes it possible to integrate separate management applications rapidly so they can share data and processing with third-party and legacy OSSs.
Benefits of this approach include the ability to anticipate customer needs proactively by analyzing usage data and responding to fault and performance problems before customers are aware of them.
Using the unified management approach to improve the speed and QoS delivery, one U.K.-based systems integrator is implementing state-of-the-art fault management for a provider of digital fiber data services to major European cities. Challenged by stiff competition, the rapidly expanding wholesaler must coordinate management systems quickly and manage them efficiently to maintain momentum.
Once a provider captures market share, maintaining QoS becomes critical. That’s why managing SLAs is challenging in global virtual environments. The unified management approach provides a continuous loop of information for evaluating and improving service. By automating the interaction of management systems from service activation to customer billing, a provider can gather and analyze data dynamically to ensure total quality management across all components that affect service to customers.
Another key benefit of unifying management applications on open systems is the ability to build IP networks to handle rapid change.
Perhaps the best example of the value of a unified approach in managing the virtual distribution of today’s complex networks and services is Telecom New Zealand
(www.telecom.co.nz). This incumbent built an advanced network with more than 98 percent of its lines connected to digital exchanges. It provides cellular, data and leased circuit communications, Internet access and online services.
According to Telecom New Zealand’s capability advisor Phil Montgomery, a unified management solution enables the company to deploy end-to-end service assurance across core network layers. This reults in optimizing network services, reducing costs and improving the ability to recover from network outages.
James Olsen is vice president of marketing at Objective Systems Integrators Inc.
(www.osi.com). He can be reached at +1 916 353
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