The Future of BSS– Clear Minds or Clouded Thinking?February 2016

1. Introduction

Based on a global survey conducted by Telecoms.com Intelligence 1, AsiaInfo carried out an analysis of operator views on the future of business support systems (BSS). We wanted to know whether operators were ready to deploy cloud-based BSS and what they thought the benefits were. We also wanted to gauge operator perspectives on the need for BSS trans-formation, their preferred approaches to BSS upgrades, and current levels of innovation in BSS-related areas such as pricing.

We analyzed the data from around 300 qualified operator respondents to discern varia-tions by geographic region as well as by operator type. The survey respondents represent-ed five distinct groups: mobile network operators, service providers, multi-play integrated operators, fixed-line operators, and cable and satellite operators. Our analysis revealed some intriguing insights into current industry thinking on IT transformation and, in particu-lar, cloud-based BSS.

Survey Results Highlights

• 73% of operators agreed that all telco business IT systems will be cloud based in the future• 71% of operators are ready to deploy cloud-based BSS services• Operators said cost reduction in IT infrastructure and operating expenses is the most compelling benefit of cloud-based BSS• Concerns about security and data privacy ranked highest among the barriers to moving BSS to the public cloud• The top drivers for IT/BSS transformation are pricing innovation and competitive differentiation• Nearly all operators agreed that flexible BSS systems are critically important for delivering an optimal customer experience• Operators in Africa and the Asia Pacific had the most innovative pricing strategies, while operators in North America were the least innovative

1 Telecoms.com Intelligence Annual Industry Survey 2016: http://telecoms.com/intelligence/annual-industry-survey-2016/

© AsiaInfo 2016

2. Detailed Findings

2.1. Operators are ready to deploy cloud-based BSS

© AsiaInfo 2016

Figure 1: When are you planning to deploy a cloud-based BSS service? (246 responses)

Most operators and service providers are ready to deploy cloud-based BSS services, with the majority of respondents saying they are already doing so or plan to do so in the next two years (see Figure 1).

It may seem surprising that the majority of operators said they already have cloud-based BSS or plan to complete a deployment in the next few years. However, the results are in line with the current industry trend for operators to deploy overlay projects, implementing specific BSS applications in their own private cloud infrastructure to support new services or enable new digital channels. Operators are introducing virtualization and other technol-ogies associated with cloud computing into their own data centers, and adopting public cloud-based BSS for some specific activities. Therefore a positive response to this question does not necessarily imply that they are shifting the entire IT stack to the public cloud (at least, not yet).

The results also provide a good measure of cloud readiness among different types of oper-ators and across different regions (see Figure 2). The regions with the highest cloud readi-ness scores were Africa, Asia Pacific, Europe and North America, where most operators said they plan to deploy cloud-based BSS by the end of 2016 or by the end of 2017. Trail-ing behind the leading regions, the least cloud ready areas were South America and the Middle East.

© AsiaInfo 2016

Among the different types of operators and service providers, there was little variation in cloud readiness score. The results clearly show that operators of all types share similar high levels of interest, enthusiasm and willingness to pursue cloud-based BSS.

© AsiaInfo 2016

Figure 2: Regional ‘Cloud Readiness Scores’ 2

2 Cloud Readiness Score is based on when operators said they planned to deploy cloud-based BSS: 7 points for ‘Already Have’; 5 points for ‘Currently Implementing’ or ‘Before End 2016’; 3 points for ‘Before End 2017’ and -5 points for ‘Never’.

2.2. Cost reduction drives operator interest in cloud-based BSS

The primary motivation for pursuing cloud-based BSS is cost reduction, particularly IT operating costs, according to the survey results (see Figure 3). Nearly half of respondents named lower costs as the most compelling benefit, which included IT infrastructure and operating costs. After cost reductions, respondents were most interested in the benefit of on-demand scalability of IT infrastructure. Meanwhile, a substantial proportion of respondents said the main benefit was the rapid introduction of a new BSS system, and a minority said it was the consolidation of the BSS environment.

While cost reduction was seen as the biggest benefit by the largest proportion of opera-tors, there were some interesting regional variations. For example, operators in Asia and Europe were more interested in the ability of cloud-based BSS to scale up or down on demand (see Figure 4). In the Asia Pacific region, although comprised of both mature and developing markets, there is much room to grow subscribers and service revenues in many countries. It makes sense that operators in this region would want more flexible scalability of back office IT systems that can expand with the introduction of new subscribers, services and tariffs as needed. In Europe, where most markets are mature, operator interest in on-demand scalability may be due to the anticipation of having to process a variety of new connections with the expected growth of the Internet of Things (IoT) market.

© AsiaInfo 2016

© AsiaInfo 2016

It is also worth noting that different types of operators see different advantages of cloud-based BSS. For example, fixed-line operators had the highest interest in consolidat-ing the BSS environment, possibly reflecting a larger amount of legacy back office systems compared to other types of operators. Similarly, cable and satellite operators are most interested in being able to introduce a new BSS system quickly, as well as lower IT infra-structure costs. This could also indicate a prevalence of legacy systems as faster deploy-ment times and lower infrastructure costs would improve the inefficiencies of older back office systems.

Figure 3: Which is the most compelling benefit of implementing a cloud-based BSS solution? (284 responses)

Overall, there is strong operator belief in the ability of cloud-based BSS to reduce IT operat-ing and infrastructure costs as well as scale flexibly according to demand.

Figure 4: Regional breakdown of perceived benefits of cloud BSS

© AsiaInfo 2016

2.3. Operators are concerned about data privacy and security of public cloud

Concerns about security and data privacy are universally perceived to be the biggest barri-er to moving BSS to the public cloud across all geographic regions and all operator types (see Figure 5). North American operators were the most concerned about security and data privacy with 71% citing this as the most significant barrier for public cloud BSS, while South American operators showed the least concern, although there was not a wide varia-tion among regions.

It is not surprising that data privacy and security are top of mind for network operators and service providers worldwide. Tough data privacy laws make operators reluctant to move back office IT systems to the public cloud, and recent high-profile data breaches have cre-ated a perception among consumers that their data is not safe with any kind of large com-pany. With heightened customer sensitivity, it is understandable that operators and service providers would adopt a cautious approach to moving IT systems that process customers’ personal data.

A smaller proportion of respondents cited other hurdles to moving BSS to the public cloud (see Figure 5), including the availability and reliability of public cloud platforms, local data regulation issues, and internal hesitancy towards change. Concerns about network latency were highest among operators in South America and Africa, which is perhaps due to less developed infrastructure in these regions. Also, operators in the Middle East and North America appear to be the most conservative and least likely to overcome internal resist-ance to change. Another noteworthy result is that 36% of fixed-line operators said that internal hesitancy to change is the biggest barrier to taking BSS to the public cloud.

© AsiaInfo 2016

Figure 5: Which of the following is the biggest barrier to moving BSS to the public cloud? (291 responses)

2.3. Operators are concerned about data privacy and security of public cloud

Concerns about security and data privacy are universally perceived to be the biggest barri-er to moving BSS to the public cloud across all geographic regions and all operator types (see Figure 5). North American operators were the most concerned about security and data privacy with 71% citing this as the most significant barrier for public cloud BSS, while South American operators showed the least concern, although there was not a wide varia-tion among regions.

It is not surprising that data privacy and security are top of mind for network operators and service providers worldwide. Tough data privacy laws make operators reluctant to move back office IT systems to the public cloud, and recent high-profile data breaches have cre-ated a perception among consumers that their data is not safe with any kind of large com-pany. With heightened customer sensitivity, it is understandable that operators and service providers would adopt a cautious approach to moving IT systems that process customers’ personal data.

A smaller proportion of respondents cited other hurdles to moving BSS to the public cloud (see Figure 5), including the availability and reliability of public cloud platforms, local data regulation issues, and internal hesitancy towards change. Concerns about network latency were highest among operators in South America and Africa, which is perhaps due to less developed infrastructure in these regions. Also, operators in the Middle East and North America appear to be the most conservative and least likely to overcome internal resist-ance to change. Another noteworthy result is that 36% of fixed-line operators said that internal hesitancy to change is the biggest barrier to taking BSS to the public cloud.

© AsiaInfo 2016

2.4. Operators have confidence in the public cloud for mission-critical IT

Despite the concerns expressed in section 2.3 above, there is clearly a strong belief in cloud BSS among all types of operators and service providers and across geographical regions. 73% of qualified operator respondents agree or strongly agree that all telco busi-ness IT systems will be cloud-based in the future (see Figure 6), although opinions were mixed among respondents about the opportunities and risks for using public cloud.

Most respondents agreed or strongly agreed that it was riskier for telcos than for other industries to use public cloud for mission-critical IT systems. This suggests that operators perceive themselves to be different compared to other enterprises or to have extra telco-specific considerations to factor in to decisions about using the public cloud, particu-larly for mission critical IT applications. Operators in the Asia Pacific region most strongly agreed that the public cloud presented greater risks for mission critical IT systems for telcos than for other industries.

Respondents were split on whether the public cloud was secure and robust enough to deploy mission-critical IT systems today. Nearly half of respondents agreed that the public cloud was indeed reliable enough for mission-critical IT systems, although the remainder were not yet convinced. This level of agreement is a sign of confidence in the robustness and security of today’s public cloud infrastructure.

Figure 7: Regional response to “Public cloud is now robust and secure enough for deploying

mission-critical telco IT systems” – chart shows comparison to average score

Among those operators that did not trust the reliability and security of the public cloud, the highest proportion was from North America (see Figure 7). This seems unusual consid-ering that the US in particular has a very mature cloud market, but it could reflect the country’s heightened sensitivity to cybersecurity issues since a handful of high profile data breaches have recently generated strong public reaction.

Respondents were also divided on whether BSS-as-a-Service is only suitable for smaller operators with simple services. Nearly half of respondents believed that BSS-as-a-Service is now capable of going beyond simple services for small operators, while the remainder said the model was not there yet.

At first sight these results appear to contradict responses to the first survey question, which indicated that most operators had already deployed or had plans to deploy cloud-based BSS by the end of 2017. However, it is likely that most current cloud-based BSS deployments are either in private cloud environments or else are not being used for mission-critical telco IT applications.

Overall, while opinions are mixed, there is strong confidence in the robustness, security and the ability to handle large-scale projects in the public cloud amongst a large number of operators, which suggests industry momentum is moving in the direction of BSS deployed in the public cloud.

2.5. Operators consider radical approaches to upgrading BSS platforms

As one might expect, operators are generally conservative in their approach to major IT system upgrades, but a significant minority of operators are interested in more radical approaches to upgrading BSS platforms (see Figure 8).

Figure 8: Which statement most accurately reflects your views about the

best approach to upgrading BSS platforms (323 responses)?

There are a number of ways to upgrade BSS platforms. Most operators and service provid-ers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or customer relationship management (CRM) system. The majority of respondents said that a gradual or ‘digital overlay’ approach, or a green-field migration of customers to a new system, are the best ways to upgrade telco IT systems.

But, in practice, introducing one new part and integrating it with the rest of the old IT system can be quite complex and challenging. More radical approaches, such as a com-plete IT system overhaul, or adopting cloud-based BSS-as-a-Service, can ultimately be more efficient ways of upgrading BSS. Nearly a quarter of respondents were in favor of these more radical approaches to IT transformation. Operators in emerging markets were most interested in this approach, while operators in North America were the least interested. 21% of Asia Pacific operators favored a shift to cloud-based BSS-as-a-Service, which was more than twice the global average of 10%. Among operator types, cable and satellite operators were the most in favor of radical approaches.

There is relatively little support for dumbing down the IT stack; only 10% of operators said that traditional telco BSS is too complex and stressed the need for simpler, cheaper, more standardized systems, but support for this view was highest in North America (16% of respondents).

2.6. Service pricing innovation: leaders and laggards

BSS is key to enabling operators to develop innovative and differentiated pricing strategies. We asked operators to select which BSS-related pricing approaches they would adopt by the end of 2016 (see Figure 9).

Figure 9: Which of the following BSS-related services will your company

support by the end of 2016? (268 responses)

Figure 6: Please state your level of agreement with the given statements (373 responses)

© AsiaInfo 2016

2.4. Operators have confidence in the public cloud for mission-critical IT

Despite the concerns expressed in section 2.3 above, there is clearly a strong belief in cloud BSS among all types of operators and service providers and across geographical regions. 73% of qualified operator respondents agree or strongly agree that all telco busi-ness IT systems will be cloud-based in the future (see Figure 6), although opinions were mixed among respondents about the opportunities and risks for using public cloud.

Most respondents agreed or strongly agreed that it was riskier for telcos than for other industries to use public cloud for mission-critical IT systems. This suggests that operators perceive themselves to be different compared to other enterprises or to have extra telco-specific considerations to factor in to decisions about using the public cloud, particu-larly for mission critical IT applications. Operators in the Asia Pacific region most strongly agreed that the public cloud presented greater risks for mission critical IT systems for telcos than for other industries.

Respondents were split on whether the public cloud was secure and robust enough to deploy mission-critical IT systems today. Nearly half of respondents agreed that the public cloud was indeed reliable enough for mission-critical IT systems, although the remainder were not yet convinced. This level of agreement is a sign of confidence in the robustness and security of today’s public cloud infrastructure.

Figure 7: Regional response to “Public cloud is now robust and secure enough for deploying

mission-critical telco IT systems” – chart shows comparison to average score

Among those operators that did not trust the reliability and security of the public cloud, the highest proportion was from North America (see Figure 7). This seems unusual consid-ering that the US in particular has a very mature cloud market, but it could reflect the country’s heightened sensitivity to cybersecurity issues since a handful of high profile data breaches have recently generated strong public reaction.

Respondents were also divided on whether BSS-as-a-Service is only suitable for smaller operators with simple services. Nearly half of respondents believed that BSS-as-a-Service is now capable of going beyond simple services for small operators, while the remainder said the model was not there yet.

At first sight these results appear to contradict responses to the first survey question, which indicated that most operators had already deployed or had plans to deploy cloud-based BSS by the end of 2017. However, it is likely that most current cloud-based BSS deployments are either in private cloud environments or else are not being used for mission-critical telco IT applications.

Overall, while opinions are mixed, there is strong confidence in the robustness, security and the ability to handle large-scale projects in the public cloud amongst a large number of operators, which suggests industry momentum is moving in the direction of BSS deployed in the public cloud.

2.5. Operators consider radical approaches to upgrading BSS platforms

As one might expect, operators are generally conservative in their approach to major IT system upgrades, but a significant minority of operators are interested in more radical approaches to upgrading BSS platforms (see Figure 8).

Figure 8: Which statement most accurately reflects your views about the

best approach to upgrading BSS platforms (323 responses)?

There are a number of ways to upgrade BSS platforms. Most operators and service provid-ers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or customer relationship management (CRM) system. The majority of respondents said that a gradual or ‘digital overlay’ approach, or a green-field migration of customers to a new system, are the best ways to upgrade telco IT systems.

But, in practice, introducing one new part and integrating it with the rest of the old IT system can be quite complex and challenging. More radical approaches, such as a com-plete IT system overhaul, or adopting cloud-based BSS-as-a-Service, can ultimately be more efficient ways of upgrading BSS. Nearly a quarter of respondents were in favor of these more radical approaches to IT transformation. Operators in emerging markets were most interested in this approach, while operators in North America were the least interested. 21% of Asia Pacific operators favored a shift to cloud-based BSS-as-a-Service, which was more than twice the global average of 10%. Among operator types, cable and satellite operators were the most in favor of radical approaches.

There is relatively little support for dumbing down the IT stack; only 10% of operators said that traditional telco BSS is too complex and stressed the need for simpler, cheaper, more standardized systems, but support for this view was highest in North America (16% of respondents).

2.6. Service pricing innovation: leaders and laggards

BSS is key to enabling operators to develop innovative and differentiated pricing strategies. We asked operators to select which BSS-related pricing approaches they would adopt by the end of 2016 (see Figure 9).

Figure 9: Which of the following BSS-related services will your company

support by the end of 2016? (268 responses)

© AsiaInfo 2016

2.4. Operators have confidence in the public cloud for mission-critical IT

Despite the concerns expressed in section 2.3 above, there is clearly a strong belief in cloud BSS among all types of operators and service providers and across geographical regions. 73% of qualified operator respondents agree or strongly agree that all telco busi-ness IT systems will be cloud-based in the future (see Figure 6), although opinions were mixed among respondents about the opportunities and risks for using public cloud.

Most respondents agreed or strongly agreed that it was riskier for telcos than for other industries to use public cloud for mission-critical IT systems. This suggests that operators perceive themselves to be different compared to other enterprises or to have extra telco-specific considerations to factor in to decisions about using the public cloud, particu-larly for mission critical IT applications. Operators in the Asia Pacific region most strongly agreed that the public cloud presented greater risks for mission critical IT systems for telcos than for other industries.

Respondents were split on whether the public cloud was secure and robust enough to deploy mission-critical IT systems today. Nearly half of respondents agreed that the public cloud was indeed reliable enough for mission-critical IT systems, although the remainder were not yet convinced. This level of agreement is a sign of confidence in the robustness and security of today’s public cloud infrastructure.

Figure 7: Regional response to “Public cloud is now robust and secure enough for deploying

mission-critical telco IT systems” – chart shows comparison to average score

Among those operators that did not trust the reliability and security of the public cloud, the highest proportion was from North America (see Figure 7). This seems unusual consid-ering that the US in particular has a very mature cloud market, but it could reflect the country’s heightened sensitivity to cybersecurity issues since a handful of high profile data breaches have recently generated strong public reaction.

Respondents were also divided on whether BSS-as-a-Service is only suitable for smaller operators with simple services. Nearly half of respondents believed that BSS-as-a-Service is now capable of going beyond simple services for small operators, while the remainder said the model was not there yet.

At first sight these results appear to contradict responses to the first survey question, which indicated that most operators had already deployed or had plans to deploy cloud-based BSS by the end of 2017. However, it is likely that most current cloud-based BSS deployments are either in private cloud environments or else are not being used for mission-critical telco IT applications.

Overall, while opinions are mixed, there is strong confidence in the robustness, security and the ability to handle large-scale projects in the public cloud amongst a large number of operators, which suggests industry momentum is moving in the direction of BSS deployed in the public cloud.

2.5. Operators consider radical approaches to upgrading BSS platforms

As one might expect, operators are generally conservative in their approach to major IT system upgrades, but a significant minority of operators are interested in more radical approaches to upgrading BSS platforms (see Figure 8).

Figure 8: Which statement most accurately reflects your views about the

best approach to upgrading BSS platforms (323 responses)?

There are a number of ways to upgrade BSS platforms. Most operators and service provid-ers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or customer relationship management (CRM) system. The majority of respondents said that a gradual or ‘digital overlay’ approach, or a green-field migration of customers to a new system, are the best ways to upgrade telco IT systems.

But, in practice, introducing one new part and integrating it with the rest of the old IT system can be quite complex and challenging. More radical approaches, such as a com-plete IT system overhaul, or adopting cloud-based BSS-as-a-Service, can ultimately be more efficient ways of upgrading BSS. Nearly a quarter of respondents were in favor of these more radical approaches to IT transformation. Operators in emerging markets were most interested in this approach, while operators in North America were the least interested. 21% of Asia Pacific operators favored a shift to cloud-based BSS-as-a-Service, which was more than twice the global average of 10%. Among operator types, cable and satellite operators were the most in favor of radical approaches.

There is relatively little support for dumbing down the IT stack; only 10% of operators said that traditional telco BSS is too complex and stressed the need for simpler, cheaper, more standardized systems, but support for this view was highest in North America (16% of respondents).

2.6. Service pricing innovation: leaders and laggards

BSS is key to enabling operators to develop innovative and differentiated pricing strategies. We asked operators to select which BSS-related pricing approaches they would adopt by the end of 2016 (see Figure 9).

Figure 9: Which of the following BSS-related services will your company

support by the end of 2016? (268 responses)

© AsiaInfo 2016

2.4. Operators have confidence in the public cloud for mission-critical IT

Despite the concerns expressed in section 2.3 above, there is clearly a strong belief in cloud BSS among all types of operators and service providers and across geographical regions. 73% of qualified operator respondents agree or strongly agree that all telco busi-ness IT systems will be cloud-based in the future (see Figure 6), although opinions were mixed among respondents about the opportunities and risks for using public cloud.

Most respondents agreed or strongly agreed that it was riskier for telcos than for other industries to use public cloud for mission-critical IT systems. This suggests that operators perceive themselves to be different compared to other enterprises or to have extra telco-specific considerations to factor in to decisions about using the public cloud, particu-larly for mission critical IT applications. Operators in the Asia Pacific region most strongly agreed that the public cloud presented greater risks for mission critical IT systems for telcos than for other industries.

Respondents were split on whether the public cloud was secure and robust enough to deploy mission-critical IT systems today. Nearly half of respondents agreed that the public cloud was indeed reliable enough for mission-critical IT systems, although the remainder were not yet convinced. This level of agreement is a sign of confidence in the robustness and security of today’s public cloud infrastructure.

Figure 7: Regional response to “Public cloud is now robust and secure enough for deploying

mission-critical telco IT systems” – chart shows comparison to average score

Among those operators that did not trust the reliability and security of the public cloud, the highest proportion was from North America (see Figure 7). This seems unusual consid-ering that the US in particular has a very mature cloud market, but it could reflect the country’s heightened sensitivity to cybersecurity issues since a handful of high profile data breaches have recently generated strong public reaction.

Respondents were also divided on whether BSS-as-a-Service is only suitable for smaller operators with simple services. Nearly half of respondents believed that BSS-as-a-Service is now capable of going beyond simple services for small operators, while the remainder said the model was not there yet.

At first sight these results appear to contradict responses to the first survey question, which indicated that most operators had already deployed or had plans to deploy cloud-based BSS by the end of 2017. However, it is likely that most current cloud-based BSS deployments are either in private cloud environments or else are not being used for mission-critical telco IT applications.

Overall, while opinions are mixed, there is strong confidence in the robustness, security and the ability to handle large-scale projects in the public cloud amongst a large number of operators, which suggests industry momentum is moving in the direction of BSS deployed in the public cloud.

2.5. Operators consider radical approaches to upgrading BSS platforms

As one might expect, operators are generally conservative in their approach to major IT system upgrades, but a significant minority of operators are interested in more radical approaches to upgrading BSS platforms (see Figure 8).

Figure 8: Which statement most accurately reflects your views about the

best approach to upgrading BSS platforms (323 responses)?

There are a number of ways to upgrade BSS platforms. Most operators and service provid-ers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or customer relationship management (CRM) system. The majority of respondents said that a gradual or ‘digital overlay’ approach, or a green-field migration of customers to a new system, are the best ways to upgrade telco IT systems.

But, in practice, introducing one new part and integrating it with the rest of the old IT system can be quite complex and challenging. More radical approaches, such as a com-plete IT system overhaul, or adopting cloud-based BSS-as-a-Service, can ultimately be more efficient ways of upgrading BSS. Nearly a quarter of respondents were in favor of these more radical approaches to IT transformation. Operators in emerging markets were most interested in this approach, while operators in North America were the least interested. 21% of Asia Pacific operators favored a shift to cloud-based BSS-as-a-Service, which was more than twice the global average of 10%. Among operator types, cable and satellite operators were the most in favor of radical approaches.

There is relatively little support for dumbing down the IT stack; only 10% of operators said that traditional telco BSS is too complex and stressed the need for simpler, cheaper, more standardized systems, but support for this view was highest in North America (16% of respondents).

2.6. Service pricing innovation: leaders and laggards

BSS is key to enabling operators to develop innovative and differentiated pricing strategies. We asked operators to select which BSS-related pricing approaches they would adopt by the end of 2016 (see Figure 9).

Figure 9: Which of the following BSS-related services will your company

support by the end of 2016? (268 responses)

© AsiaInfo 2016

2.4. Operators have confidence in the public cloud for mission-critical IT

Despite the concerns expressed in section 2.3 above, there is clearly a strong belief in cloud BSS among all types of operators and service providers and across geographical regions. 73% of qualified operator respondents agree or strongly agree that all telco busi-ness IT systems will be cloud-based in the future (see Figure 6), although opinions were mixed among respondents about the opportunities and risks for using public cloud.

Most respondents agreed or strongly agreed that it was riskier for telcos than for other industries to use public cloud for mission-critical IT systems. This suggests that operators perceive themselves to be different compared to other enterprises or to have extra telco-specific considerations to factor in to decisions about using the public cloud, particu-larly for mission critical IT applications. Operators in the Asia Pacific region most strongly agreed that the public cloud presented greater risks for mission critical IT systems for telcos than for other industries.

Respondents were split on whether the public cloud was secure and robust enough to deploy mission-critical IT systems today. Nearly half of respondents agreed that the public cloud was indeed reliable enough for mission-critical IT systems, although the remainder were not yet convinced. This level of agreement is a sign of confidence in the robustness and security of today’s public cloud infrastructure.

Figure 7: Regional response to “Public cloud is now robust and secure enough for deploying

mission-critical telco IT systems” – chart shows comparison to average score

Among those operators that did not trust the reliability and security of the public cloud, the highest proportion was from North America (see Figure 7). This seems unusual consid-ering that the US in particular has a very mature cloud market, but it could reflect the country’s heightened sensitivity to cybersecurity issues since a handful of high profile data breaches have recently generated strong public reaction.

Respondents were also divided on whether BSS-as-a-Service is only suitable for smaller operators with simple services. Nearly half of respondents believed that BSS-as-a-Service is now capable of going beyond simple services for small operators, while the remainder said the model was not there yet.

At first sight these results appear to contradict responses to the first survey question, which indicated that most operators had already deployed or had plans to deploy cloud-based BSS by the end of 2017. However, it is likely that most current cloud-based BSS deployments are either in private cloud environments or else are not being used for mission-critical telco IT applications.

Overall, while opinions are mixed, there is strong confidence in the robustness, security and the ability to handle large-scale projects in the public cloud amongst a large number of operators, which suggests industry momentum is moving in the direction of BSS deployed in the public cloud.

2.5. Operators consider radical approaches to upgrading BSS platforms

As one might expect, operators are generally conservative in their approach to major IT system upgrades, but a significant minority of operators are interested in more radical approaches to upgrading BSS platforms (see Figure 8).

Figure 8: Which statement most accurately reflects your views about the

best approach to upgrading BSS platforms (323 responses)?

There are a number of ways to upgrade BSS platforms. Most operators and service provid-ers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or customer relationship management (CRM) system. The majority of respondents said that a gradual or ‘digital overlay’ approach, or a green-field migration of customers to a new system, are the best ways to upgrade telco IT systems.

But, in practice, introducing one new part and integrating it with the rest of the old IT system can be quite complex and challenging. More radical approaches, such as a com-plete IT system overhaul, or adopting cloud-based BSS-as-a-Service, can ultimately be more efficient ways of upgrading BSS. Nearly a quarter of respondents were in favor of these more radical approaches to IT transformation. Operators in emerging markets were most interested in this approach, while operators in North America were the least interested. 21% of Asia Pacific operators favored a shift to cloud-based BSS-as-a-Service, which was more than twice the global average of 10%. Among operator types, cable and satellite operators were the most in favor of radical approaches.

There is relatively little support for dumbing down the IT stack; only 10% of operators said that traditional telco BSS is too complex and stressed the need for simpler, cheaper, more standardized systems, but support for this view was highest in North America (16% of respondents).

2.6. Service pricing innovation: leaders and laggards

BSS is key to enabling operators to develop innovative and differentiated pricing strategies. We asked operators to select which BSS-related pricing approaches they would adopt by the end of 2016 (see Figure 9).

Figure 9: Which of the following BSS-related services will your company

support by the end of 2016? (268 responses)

© AsiaInfo 2016

We also gave each operator a Pricing Innovation Score based on based on the number of innovative pricing approaches they said they currently offer, and then aggregated these scores across each region (see Figure 10). The results clearly show pricing leaders and laggards.

Figure 10: Pricing Innovation Score by region

Operators in Africa and the Asia Pacific regions emerged as the leaders with most innova-tive pricing strategies, while operators in North America were the least innovative by quite a wide margin.

In Africa and the Asia Pacific, the majority of operators said that they offer differentiated pricing based on data speed or Quality of Service (QoS) as well as personalized, con-text-aware marketing offers. Also in Africa, a significant proportion of operators offer personalized pricing for consumer tariff plans and fixed-price access to specific apps, while in Asia a big proportion of operators offer time-limited data pricing.Looking at different operator types, integrated multi-play operators and mobile operators were the pricing innovation leaders while cable and satellite operators were the pricing laggards.

The majority of mobile operators said they had adopted context-aware marketing offers and pricing based on data speed or QoS. Multi-play operators, meanwhile, were big on time-limited data offers and speed-based pricing as well as personalized consumer plans and fixed-price access to selected apps.

2.7. Pricing and competitive differentiation drives IT/BSS transformation

Figure 11: How important are these considerations as drivers for IT/BSS transformation?

(351 responses)

Operators rated many considerations as important drivers for IT/BSS transformation, but the survey revealed that the most important consideration across all regions was pricing innovation and competitive differentiation (see Figure 11).

After pricing innovation, operators said the next most important drivers for transforming IT systems were improving the omni-channel customer experience and enabling customer analytics and insight monetization.

One interesting regional variation was that creating new business models and adding value to digital service partners was considered 25% more important to operators in the Asia Pacific region than elsewhere.

The results indicate that operators perceive the value of BSS transformation in differentiat-ing service offerings, developing new services based on data analytics as well as improving customer relationships and interactions.

2.8. Flexible BSS systems are critical to delivering best customer experience

Figure 12: To what extent do you agree or disagree with these statements? (324 responses)

The majority of respondents (60%) said that most existing BSS platforms are not capable of supporting future telco business models, underlying the need for IT transformation (see Figure 12).

Nearly all operators and service providers agreed that flexible BSS systems are critically important for delivering an optimal customer experience, and most also said that flexible BSS is essential to competitive differentiation and to enabling future business strategies.

The survey results revealed some interesting regional differences. European operators were 15% less convinced that BSS transformation is important for enabling future business strategies than their counterparts in North America, while operators in South America were 15% less persuaded of the impact of BSS on customer experience than their counter-parts in the Middle East. Interestingly, despite their strong position as pricing innovators (see section 2.6 above) operators in Asia Pacific were the least enthusiastic about the ability of BSS to deliver competitive differentiation.

3. Conclusion

Most operators believe existing BSS platforms are not fit to support future business models, so the need for change is clear. IT transformation is essential to support this busi-ness transformation. While the industry is traditionally conservative, new options such as cloud-based BSS are becoming increasingly attractive as important agents of change for operators. Indeed, there is increasing confidence that the public cloud may be ready for mission critical telco IT applications and nearly all operators already agree that the future of telco IT is in the cloud. Whether motivated by cost savings, IT infrastructure scalability or the streamlining of back office environments, operators recognize the advantages of cloud-based BSS. In future, flexible cloud-based BSS systems will be a key enabler for operators to achieve competitive differentiation and deliver the best experience to their customers.

© AsiaInfo 2016

We also gave each operator a Pricing Innovation Score based on based on the number of innovative pricing approaches they said they currently offer, and then aggregated these scores across each region (see Figure 10). The results clearly show pricing leaders and laggards.

Figure 10: Pricing Innovation Score by region

Operators in Africa and the Asia Pacific regions emerged as the leaders with most innova-tive pricing strategies, while operators in North America were the least innovative by quite a wide margin.

In Africa and the Asia Pacific, the majority of operators said that they offer differentiated pricing based on data speed or Quality of Service (QoS) as well as personalized, con-text-aware marketing offers. Also in Africa, a significant proportion of operators offer personalized pricing for consumer tariff plans and fixed-price access to specific apps, while in Asia a big proportion of operators offer time-limited data pricing.Looking at different operator types, integrated multi-play operators and mobile operators were the pricing innovation leaders while cable and satellite operators were the pricing laggards.

The majority of mobile operators said they had adopted context-aware marketing offers and pricing based on data speed or QoS. Multi-play operators, meanwhile, were big on time-limited data offers and speed-based pricing as well as personalized consumer plans and fixed-price access to selected apps.

2.7. Pricing and competitive differentiation drives IT/BSS transformation

Figure 11: How important are these considerations as drivers for IT/BSS transformation?

(351 responses)

Operators rated many considerations as important drivers for IT/BSS transformation, but the survey revealed that the most important consideration across all regions was pricing innovation and competitive differentiation (see Figure 11).

After pricing innovation, operators said the next most important drivers for transforming IT systems were improving the omni-channel customer experience and enabling customer analytics and insight monetization.

One interesting regional variation was that creating new business models and adding value to digital service partners was considered 25% more important to operators in the Asia Pacific region than elsewhere.

The results indicate that operators perceive the value of BSS transformation in differentiat-ing service offerings, developing new services based on data analytics as well as improving customer relationships and interactions.

2.8. Flexible BSS systems are critical to delivering best customer experience

Figure 12: To what extent do you agree or disagree with these statements? (324 responses)

The majority of respondents (60%) said that most existing BSS platforms are not capable of supporting future telco business models, underlying the need for IT transformation (see Figure 12).

Nearly all operators and service providers agreed that flexible BSS systems are critically important for delivering an optimal customer experience, and most also said that flexible BSS is essential to competitive differentiation and to enabling future business strategies.

The survey results revealed some interesting regional differences. European operators were 15% less convinced that BSS transformation is important for enabling future business strategies than their counterparts in North America, while operators in South America were 15% less persuaded of the impact of BSS on customer experience than their counter-parts in the Middle East. Interestingly, despite their strong position as pricing innovators (see section 2.6 above) operators in Asia Pacific were the least enthusiastic about the ability of BSS to deliver competitive differentiation.

3. Conclusion

Most operators believe existing BSS platforms are not fit to support future business models, so the need for change is clear. IT transformation is essential to support this busi-ness transformation. While the industry is traditionally conservative, new options such as cloud-based BSS are becoming increasingly attractive as important agents of change for operators. Indeed, there is increasing confidence that the public cloud may be ready for mission critical telco IT applications and nearly all operators already agree that the future of telco IT is in the cloud. Whether motivated by cost savings, IT infrastructure scalability or the streamlining of back office environments, operators recognize the advantages of cloud-based BSS. In future, flexible cloud-based BSS systems will be a key enabler for operators to achieve competitive differentiation and deliver the best experience to their customers.

© AsiaInfo 2016

We also gave each operator a Pricing Innovation Score based on based on the number of innovative pricing approaches they said they currently offer, and then aggregated these scores across each region (see Figure 10). The results clearly show pricing leaders and laggards.

Figure 10: Pricing Innovation Score by region

Operators in Africa and the Asia Pacific regions emerged as the leaders with most innova-tive pricing strategies, while operators in North America were the least innovative by quite a wide margin.

In Africa and the Asia Pacific, the majority of operators said that they offer differentiated pricing based on data speed or Quality of Service (QoS) as well as personalized, con-text-aware marketing offers. Also in Africa, a significant proportion of operators offer personalized pricing for consumer tariff plans and fixed-price access to specific apps, while in Asia a big proportion of operators offer time-limited data pricing.Looking at different operator types, integrated multi-play operators and mobile operators were the pricing innovation leaders while cable and satellite operators were the pricing laggards.

The majority of mobile operators said they had adopted context-aware marketing offers and pricing based on data speed or QoS. Multi-play operators, meanwhile, were big on time-limited data offers and speed-based pricing as well as personalized consumer plans and fixed-price access to selected apps.

2.7. Pricing and competitive differentiation drives IT/BSS transformation

Figure 11: How important are these considerations as drivers for IT/BSS transformation?

(351 responses)

Operators rated many considerations as important drivers for IT/BSS transformation, but the survey revealed that the most important consideration across all regions was pricing innovation and competitive differentiation (see Figure 11).

After pricing innovation, operators said the next most important drivers for transforming IT systems were improving the omni-channel customer experience and enabling customer analytics and insight monetization.

One interesting regional variation was that creating new business models and adding value to digital service partners was considered 25% more important to operators in the Asia Pacific region than elsewhere.

The results indicate that operators perceive the value of BSS transformation in differentiat-ing service offerings, developing new services based on data analytics as well as improving customer relationships and interactions.

2.8. Flexible BSS systems are critical to delivering best customer experience

Figure 12: To what extent do you agree or disagree with these statements? (324 responses)

The majority of respondents (60%) said that most existing BSS platforms are not capable of supporting future telco business models, underlying the need for IT transformation (see Figure 12).

Nearly all operators and service providers agreed that flexible BSS systems are critically important for delivering an optimal customer experience, and most also said that flexible BSS is essential to competitive differentiation and to enabling future business strategies.

The survey results revealed some interesting regional differences. European operators were 15% less convinced that BSS transformation is important for enabling future business strategies than their counterparts in North America, while operators in South America were 15% less persuaded of the impact of BSS on customer experience than their counter-parts in the Middle East. Interestingly, despite their strong position as pricing innovators (see section 2.6 above) operators in Asia Pacific were the least enthusiastic about the ability of BSS to deliver competitive differentiation.

3. Conclusion

Most operators believe existing BSS platforms are not fit to support future business models, so the need for change is clear. IT transformation is essential to support this busi-ness transformation. While the industry is traditionally conservative, new options such as cloud-based BSS are becoming increasingly attractive as important agents of change for operators. Indeed, there is increasing confidence that the public cloud may be ready for mission critical telco IT applications and nearly all operators already agree that the future of telco IT is in the cloud. Whether motivated by cost savings, IT infrastructure scalability or the streamlining of back office environments, operators recognize the advantages of cloud-based BSS. In future, flexible cloud-based BSS systems will be a key enabler for operators to achieve competitive differentiation and deliver the best experience to their customers.

© AsiaInfo 2016

We also gave each operator a Pricing Innovation Score based on based on the number of innovative pricing approaches they said they currently offer, and then aggregated these scores across each region (see Figure 10). The results clearly show pricing leaders and laggards.

Figure 10: Pricing Innovation Score by region

Operators in Africa and the Asia Pacific regions emerged as the leaders with most innova-tive pricing strategies, while operators in North America were the least innovative by quite a wide margin.

In Africa and the Asia Pacific, the majority of operators said that they offer differentiated pricing based on data speed or Quality of Service (QoS) as well as personalized, con-text-aware marketing offers. Also in Africa, a significant proportion of operators offer personalized pricing for consumer tariff plans and fixed-price access to specific apps, while in Asia a big proportion of operators offer time-limited data pricing.Looking at different operator types, integrated multi-play operators and mobile operators were the pricing innovation leaders while cable and satellite operators were the pricing laggards.

The majority of mobile operators said they had adopted context-aware marketing offers and pricing based on data speed or QoS. Multi-play operators, meanwhile, were big on time-limited data offers and speed-based pricing as well as personalized consumer plans and fixed-price access to selected apps.

2.7. Pricing and competitive differentiation drives IT/BSS transformation

Figure 11: How important are these considerations as drivers for IT/BSS transformation?

(351 responses)

Operators rated many considerations as important drivers for IT/BSS transformation, but the survey revealed that the most important consideration across all regions was pricing innovation and competitive differentiation (see Figure 11).

After pricing innovation, operators said the next most important drivers for transforming IT systems were improving the omni-channel customer experience and enabling customer analytics and insight monetization.

One interesting regional variation was that creating new business models and adding value to digital service partners was considered 25% more important to operators in the Asia Pacific region than elsewhere.

The results indicate that operators perceive the value of BSS transformation in differentiat-ing service offerings, developing new services based on data analytics as well as improving customer relationships and interactions.

2.8. Flexible BSS systems are critical to delivering best customer experience

Figure 12: To what extent do you agree or disagree with these statements? (324 responses)

The majority of respondents (60%) said that most existing BSS platforms are not capable of supporting future telco business models, underlying the need for IT transformation (see Figure 12).

Nearly all operators and service providers agreed that flexible BSS systems are critically important for delivering an optimal customer experience, and most also said that flexible BSS is essential to competitive differentiation and to enabling future business strategies.

The survey results revealed some interesting regional differences. European operators were 15% less convinced that BSS transformation is important for enabling future business strategies than their counterparts in North America, while operators in South America were 15% less persuaded of the impact of BSS on customer experience than their counter-parts in the Middle East. Interestingly, despite their strong position as pricing innovators (see section 2.6 above) operators in Asia Pacific were the least enthusiastic about the ability of BSS to deliver competitive differentiation.

3. Conclusion

Most operators believe existing BSS platforms are not fit to support future business models, so the need for change is clear. IT transformation is essential to support this busi-ness transformation. While the industry is traditionally conservative, new options such as cloud-based BSS are becoming increasingly attractive as important agents of change for operators. Indeed, there is increasing confidence that the public cloud may be ready for mission critical telco IT applications and nearly all operators already agree that the future of telco IT is in the cloud. Whether motivated by cost savings, IT infrastructure scalability or the streamlining of back office environments, operators recognize the advantages of cloud-based BSS. In future, flexible cloud-based BSS systems will be a key enabler for operators to achieve competitive differentiation and deliver the best experience to their customers.

© AsiaInfo 2016

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