Mixed results

Web 2.0-style telephony development is off to a slow start, but the challenges are less about technology than changing mind-sets -- and business models

No one said Web-style development was going to come to the world of telephony at, well, Internet speed.

But even as vendors and service providers have advocated this new, more rapid and open approach to telecom service creation, market realities — and carrier fears — have left carrier Web 2.0 mostly stalled at takeoff. Even pioneering efforts such as BT's Web21C remain in a very early stage, admitted Joe Black, head of business development for BT's software development kit (SDK) team. “This is an iterative process for us; we're still figuring out where we're at and where we need to be going,” he said.

That telephony mashups can be built is no longer the question — there are enough telecom-enabled Salesforce.com mashups to keep an army of salespeople click-to-calling for days. Rather, the challenges center around “softer” but harder-to-solve problems such as how to fit into a software ecosystem and, most crucially, how to make money.

“Carriers want to maintain a revenue relationship that is service- or transaction-based,” said Ty Wang, senior director of product marketing for Oracle's communications group. Web 2.0 developers, by comparison, want to launch with as little overhead as possible and typically generate all the revenue they need via advertising, he said.

“Carriers need to shift their thinking from delivering services to enabling services,” said Geoff Parkins, manager of service provider solutions for IBM's telecom industry division. “It sounds like the same thing, but it's a totally different way of doing business.”

Carriers also need to shift their thinking about exactly how they fit into the Web 2.0 universe. The idea that a telco would deliver a set of APIs that would be universally adopted by the public Internet Web 2.0 crowd seems increasingly unlikely. The Web is globally horizontal; telecom is geographically fragmented. It seems more likely that some start-up or Google itself will build those APIs — essentially competing with, rather than partnering with, carriers.

“There's no sense for a telco to go after the [consumer Web] mashup business; that ship has sailed,” Parkins said. “But it's important for carriers to try to understand how the assets they do have, things like presence and context, can provide real value.”

That doesn't mean that telco mashups can't or won't find an audience. The enterprise remains a huge opportunity, with so-called “communications-enabled business processes” still a hot buzzword in IT circles. And Web 2.0 as a development style still holds tremendous promise to help carriers speed new service creation out to existing customers.

For carriers, it's still about joining the game or getting left behind. “When I talk to our customers, it's not about how to ‘dominate’ Web 2.0,” Oracle's Wang said. “It's about how do you become relevant in the Web 2.0 world? That's the question.”

WEB 2.0 HURDLES

Service providers are navigating several challenges as they put their Web 2.0 development strategies into place:

Making Money

Revenue models aren't coming easily for telcos, which typically count on transaction or subscriber revenue. Web 2.0 is about “two-sided” revenue models such as advertising or value added by third parties.

The Path to Customers

Google is a horizontal, global company; telcos are a global and fragmented bunch. That different model requires different ways of reaching both consumers with Web 2.0 services and developers with Web 2.0 APIs.

Courting Developers

Most telcos have few developers in-house and limited relationships with third-party developers.

Network Concerns

Opening up access to the network and BSS/OSS core requires new systems to ensure security, enable policy management, and simplify and accelerate service/API exposure.