The guessing game

Service providers have a lot to think about these days. The economy is forcing them to refocus and look for new ways to maintain some type of edge. But it's not going to be easy in this faltering telecom industry. In a game where the odds are stacking against them — less staff, less resources, less everything — carriers have to optimize existing systems while keeping an eye on the future.

“There is a tremendous amount of turmoil and change among not only vendors but among the clients,” says Keith Nelson, senior vice president of sales and marketing for Abiliti Solutions.

Service providers need some introspection. They have to take inventory. They have to scrutinize their return on investment. They need to round out their service offerings and look to the back office for support and streamlining. They need to create an end-to-end solution that works for them and subsequently provide customers with quality services, which could help prevent churn and maybe even help reverse the current slump in the telecom market.

And Supercomm 2001 is coming just in time to give carriers some options. Software vendors will be touting solutions that cover all aspects of the back office to help integrate boxes better and make a more efficient operation — from ordering and provisioning services to billing and customer care solutions to network management type solutions.

“The theme is going to be, ‘What are the things that help me operate more efficiently?’” says Dana Brown, vice president of marketing for MetaSolv.

Sue Forbes, Narus' vice president of solutions marketing and business development, concurs. “[This year] people are less focused on just building out their networks. Now they're focused on how to operate them and how to operate them profitably as a key component of that,” she says.

Efficiency seems to be key when improving networks — using resources wisely when finding the right software solution to fit a carrier's particular needs.

“We've started to see that carriers — particularly newer ones — are not looking at significant investments. They're looking at other models like those revenue-sharing models or outsourcing models where they don't have to put as much money into their infrastructure right at the get go,” says Rolando Espinosa, senior vice president of products and strategy at Abiliti.

But skepticism is out there. Vendors are always touting their solutions — that's what they do — but in the rush to the next generation, mistakes have been made. And especially now, service providers are not looking for mistakes.

“Things are a little bit more jaded out there,” says Pete Oliver, president and CEO of Ai Metrix. “People have been burned by software that doesn't work — software that's a nightmare to get deployed and integrated with what they have, so customers are very skeptical. This is actually very good for us. We like to prove our software.”

Supercomm is probably the biggest show around. But with the market in its current state, it begs the question: Who's going to be attending this year?

There are notable absences, including many of the largest billing providers. That could spell opportunity for those who make the trip.

“People who will be at the show will be there to solve real problems,” says Razi Imam, vice president of marketing and business development for CoManage.

Where to now?

The bull market of the past couple of years caused a purchasing frenzy. Carriers bought out other carriers. Mergers, partnerships and buyouts seemed to top all telecom headlines for vendors and carriers alike.

The headlines are different now, but there still are ongoing efforts to consolidate acquisitions and to maximize the embedded base. And consolidation, by most accounts, will continue.

“There's more merging of resources and there is actually a lot more focus to operate businesses vs. grow businesses,” says Abiliti's Nelson.

But can carriers absorbed by other carriers retain some type of autonomy?

Ai Metrix's Oliver doesn't think so. “You will see more liquidation-type consolidation than somebody picking up another person's mess. Unless something is already a well-run business, they're basically going to liquidate it and take the subscribers, take the network, use their own systems and move on.”

Despite the economy and in addition to the back office, well-positioned service providers are looking to the future.

“Qwest is always evaluating new technology,” says Rob Sigmundik, DSL product development manager for Qwest Communications.

Qwest will use Supercomm to measure the progress of broadband voice. “The future integration of high-quality voice service with broadband access is something we see great potential value in for our customers — both business and consumer,” Sigmundik says.

But, the future may be a little more distant than June in Atlanta. “The technology still needs to mature. What we're looking for now is equipment with a clear migration path from the VoDSL GR-303 gateway of today to a VoDSL gateway under control of a “softswitch” within a couple of years,” he says.

Now that the economy has brought a halt to network buildout, service providers will be shopping for revenue generators.

NewSouth Communications recently completed its 41-market, nine-state network and will be looking for ways to add customers to it. With $85 million in new financing, the Southeast service provider has some cash to spread around, but needs to spend it wisely.

“The build-it-and-they-will-come phase is over,” says James Akerheilm, CEO at NewSouth. “Now it is time to focus more exclusively on execution, selling, installation, and customer care. The financing is in the form of capex and is based on acquiring customers, so we are really targeting customer acquisition.”

Step right up

For those with more immediate needs, software vendors will roll up their sleeves and flex the biceps on their latest and greatest releases. They will try to lure carriers from all walks of life, be they incumbent local exchange carriers (ILECs) or even enterprise networks.

And though the CLEC market seems to be the most tenuous at the moment, CLEC business is not being disregarded — yet.

“We will continue to address that market segment but maybe more selectively than we have in the past,” says Mark Effinger, managing director of Telcordia Technologies. “Certainly, those with a little more maturity and a little more mass — we think we have greater value to add to their operations.”

Though practically a start-up itself, Narus predominately focuses on Tier 1 carriers. “The shift in the market has kind of reiterated that focus for us,” Forbes says. “We don't focus on Tier 1 [at the] exclusion of other players, but when we look at other players we are careful to look at their financial scenario as well.”

MetaSolv is expanding into a new direction altogether: the enterprise market. The company is launching software that lets enterprises manage their communications networks and includes the ability to tie together the service provider and their large enterprise customers. “We are creating solutions that enable [service providers] to extend self-care to the enterprise,” Brown says.

For vendors, getting the right message to providers is always a bit of a guessing game. But with the stakes being raised higher this year, it's important they make the right bet. Here is where some vendors are laying down their chips.

“ILECs are motivated right now to roll broadband out because they can get equipment fairly cheap,” says Ai Metrix's Oliver. “What they are looking for is the software that will allow them to exploit all the cheap hardware that they can get.”

Ai Metrix has been focusing on digital access to the subscriber, which includes DSL and cable modems, and optical core transition. Ai Metrix will demonstrate its DSL and optical broadband solutions at this year's show.

Ai Metrix's NeuralStar suite of network management applications includes the NetIntegrator for OSS system integration, NetActivator for service activation, NetAdvisor service assurance solution and NetAuditor inventory management application.

Live demos will be run of the DSL and optical solutions. The DSL provisioning demo will use Portal Software's Infranet billing and customer management system to drive it. Information will be passed off to the NeuralStar system via XML, filter through the network and activate service so that a subscriber can make IP telephony calls and then look at their billing over the Internet in real time, Oliver says.

The optical demo is a little bit different, Oliver says. A circuit-design program will be at the show that allows a variety of different types of circuits to be created such as DS-3s, DS-1s or gigabit Ethernet. Ai Metrix will demo a Cisco ONS 14454 along with the 6100 series DSL gear.

Abiliti plans on touting its billing and event-rating platform and its BillingCentral ASP services along with its new name (the company was formerly called Intertec Management Group).

The EventProcessor is a rating engine for billing that works in real time; BillingCentral is a billing ASP that allows users to outsource billing needs to Abiliti.

Bargains galore

Service providers can see an end-to-end solution that works with various business models at the CoManage booth. The company is unveiling a new customer-aware solution for voice over broadband and virtual private networks as well as multivendor, multiservice environments. The solution is built around CoManage's Integrated Service Manager product, which delivers customer-aware service management. Telution will provide some of the customer-care functions for the demo (Figure 1).

“It really simplifies what the service providers need to contend with when they're signing customers up on their network or even when they're planning out their network,” says Kent Steffen, president and CEO of Telution.

MetaSolv is creating targeted messages for carrier customers. “You've got to hit them hard and understand right away what their business problem is and say ‘here is our solution for XYZ, come over and take a look at it,’” says MetaSolv's Brown. “That's different for us, to be very targeted in that respect.”

In addition to moving into the enterprise space, the company will continue its push into foreign markets. The company recently announced MetaSolv Solution 5.0. The M/5 completes activities such as inventory management, order management and workflows but supports international standards. M/5 will be generally available by Supercomm.

“We're not about reinventing MetaSolv,” Brown says. “We are about showing [carriers] very tangible results about why operating efficiencies are so critical at this juncture.”

Narus is touting specific solutions for specific market segments. “We have launched a series of solutions that really help customers with particular pain points,” Forbes says.

The Narus Solutions Packages are based on the Narus Internet Business Infrastructure Platform. The company will display solutions for four target areas: the broadband marketplace, the IXC marketplace, the hosting marketplace and the mobile Internet arena.

“We have this end-to-end capability, and what we're doing now is focusing on the end-to-end solutions that our customer base can see immediately in terms of the resolution of an immediate pain point that they're feeling,” Forbes says.

Narus will participate in the IPDR Interoperability Pavilion, demonstrating implementations of the network data management-usage specification. Narus also will demonstrate video on demand and voice-over-IP services using the IPDR standard (Figure 2).

Telcordia is announcing an operations solution to solve industry problems associated with today's “best-of-breed” solutions for network operators.

“Carriers will be looking for more streamlined and fully integrated solutions to meet their business needs and goals,” says Telcordia's Effinger. “As the telecommunications market continues to mature, there is tremendous focus on profitability, and as a result, we expect to see increased attention on operational efficiency.”

It is clear that service providers have two priorities at this year's Supercomm: To find solutions that can help them make money today and to keep an open mind about technologies that will help them make money tomorrow.

Vendors have a more singular mission: To be the ones who help them.