Alec Barton, Founder and Editor-in-Chief of Developing Telecoms, spoke to Chris Fabian of UNICEF about some of the key challenges facing MNOs in emerging markets. The full interview can be read in our Special Report, Connected Citizens – Managing Crisis, available to download free of charge here.
Open source is a challenging topic for service providers – their business models involve differentiation, and operators worry that their services will be commoditised with open source solutions. How can this approach be reconciled with operators?
It’s an interesting space for discussion – our experience as a team in the private sector has led us to be strongly supportive of open source. We firmly believe that this isn’t just about principles – open source business models are actually stronger than proprietary models given the rapid pace at which technology changes. Mobile network operators really need to see this – large businesses, including major device manufacturers, are going out of business partially because of their reluctance to be open about research and design. In 2015, your intellectual property – i.e. the technology itself – is much less valuable than your community of users. The start-ups of Silicon Valley are seeing this – mobile network operators need to understand it too. Anybody can rip off anyone else’s technology in weeks or even days – the user base is what protects from churn. It’s important to build up a sense that you can change and remain competitive – it’s more about faith than the specific technology, because that can be ripped off so quickly.
Companies will argue that offering a service that isn’t unique will mean that they can’t stand out – therefore they might struggle to accept this argument.
They can easily not accept it – but they will become irrelevant over the next few years. If MNOs aren’t faced with existential fear on every front right now, they’re doing something wrong. It’s a time of rapid change in the software space. Most of the QoS backhaul systems that they run are on hyper-proprietary complex software that requires a huge amount of money and specific people to change. If I was running a business that had such a huge dependency on an external vendor for the base system control elements, I would take a deep look at that. Modern tech companies are building themselves on open source stacks, which means they can be flexible and agile. It doesn’t make them more or less competitive – it gives them more options on who you can get to work with you and how quickly you can develop new solutions and bring them to market. There should be a deep fear of being stuck in a ten-year-old set of technology protocols in an industry where there is a constant need to change.
With the advent of NFV/SDN, operators are looking at maintaining their uniqueness through proprietary software rather than physical hardware – does this trend hold any water with you?
MNOs are making business decisions at that level about where to be proprietary or not. Virtualisation can fragment markets from the inside – look at what Skype did globally – and if I were the CEO of an MNO, my worry regarding investment in a proprietary stack would be that if I put your chips on the wrong roulette colour, I’d be in big trouble. We’ve seen how easy it is to lose a market – particularly in places such as East Africa, where the VAS layer is so important. If users get a hint of something that’s better than their current service, they’ll flee without a second thought, so being agile is incredibly important for MNOs. My contention about open source is more on the service layer than on the back-end control technology layer. Developing new user-facing services provides the most compelling reasons for being open source – you can tap into that rich local environment of software developers and VAS providers. From this angle, it’s easy to make an argument for open source solutions that can tie into proprietary backends, but the lean development time means that you can try something in multiple different markets at the same time and see what works. Then, you can pick the best of those open solutions and develop a community around it that sustains it.
The full version of this interview can be read in our Connected Citizens Report –click here to download it for free.