Amdocs: Telco opportunity in supporting a 'trillion' devices

More open mobile apps and devices may seem to point to a dire future in which telecom operators lose control over the customer experience – bleeding revenues in the process.

But a future of a “trillion” devices – some consumer-oriented but exponentially more communicating over machine-to-machine links – actually offers service providers a much larger opportunity to serve as bullet-proof network provider and single-point-of-contact helping customers manage this new hyper-connected world.

That’s the story that Bill Guinn, CTO of Amdocs’ product business group has been delivering as part of his travels visiting telecom service providers around the world. Amdocs sells back-office systems to help operators manage their networks, subscribers and partners and has been pitching this larger vision (which it dubs “Tera-Play,” first detailed last summer) to shift telco thinking on how to succeed in this new environment. Late last month, Amdocs acquired service delivery platform (SDP) vendor JNetx, in large part to improve its service delivery capabilities.

While the telecom industry feels like it’s been on hold during the recession, global trends like mobile data growth and connected device proliferation aren’t slowing down. In its recent earnings report, Amdocs seemed to turn its ship around and projected a solid first quarter of next year, in large part aiming to take advantage of such opportunities.

“There will be a trillion connected devices on this planet in a couple of years,” Guinn said in an interview. “That opens up a tremendous opportunity for the telecom industry. For CSPs operating in today’s commoditized work, competing on minutes and bytes, it’s extremely cut-throat these days. Instead, service providers need to be thinking about how to create new business models that capitalize on emerging mobile technologies.”

Such an approach must take into account and help to enable emerging new vertical applications, said Guinn, such as smart grids in energy and telemedicine in the health care industry. That focus on mission-critical – in some cases life-and-death—vertical solutions requires the guaranteed network availability that service providers are known for, not the “best-effort” network services of Google and other Web-style service companies.

“We see the industry focus moving away from just using mobile technology for communications and data transport to using it to support specific value-added services, things like a health-care provider using a mobile network to monitor a patients glucose levels,” Guinn said. “Those are life-saving type services. You need a carrier-grade network for that; Google can’t do it. When’s the last time you called Google for support?”

Indeed, while vertical industries will be relying on communications networks and services to enable these new services, “They aren’t going to onboard themselves into these new business models. They’re going to look at carriers as the hub.”

Telecom service providers have important capabilities to support such connected applications: bullet-proof and highly-monitored networks, the ability to track and trace trouble spots and customer call centers that can be leveraged to solve problems and help customers, Guinn said. “Providers have decades of experience doing this, it’s a natural extension of where they are today. Consumers are going to have dozens if not hundreds of devices and services working intelligently – or in some cases unintelligently – on their behalf. It’s not going to be practical to expect them to understand how that technology works or even who is providing those devices.

“If something goes wrong, you want to call a service provider for help – that will be the telecom providers,” Guinn said. “The business opportunity is not just to create a network platform to run those services but to really support them as well. If they do it well, their brand equity will improve dramatically as well – [CSPs] will be someone you can trust.”