Is the Telecoms Industry on the Cusp of a New Horizontal Chain of Command for Value Creation?

In telecoms, the bulk of commercial engagements revolve around consumers and generic, connectivity-driven use cases. With the advent of 5G, an agile delivery mode whereby customized and even personalized (consumer and enterprise) use cases take center stage is bound to prevail. The large-scale commercialization of bespoke use cases calls for an overarching telco Artificial Intelligence (AI) ecosystem to support existing telco operations. But, for an industry anchored on physical and inflexible networks, widespread utilization of AI will come with challenges. The complexity is intensified by the arrival of 5G, with which network parameters, processing algorithms, and the number of alarms are all expected to grow. Furthermore, 5G will be a composition of several network layers that leverage heterogeneous technology with varied maturity levels, including physical and virtual network components and private, public, and hybrid cloud infrastructures. For example, on the Radio Access Network (RAN) side, AI and cloud technology have yet to reach the maturity levels found in other parts of the ecosystem.

Given telco ecosystems’ complexity, Communications Service Providers (CSPs) are showing a strong interest in understanding the nature and provenance of network anomalies which, in the current vertical and siloed operational environment, is not easy to accomplish with accuracy and efficiency. A select group of CSPs (e.g., AT&T, Telefonica, SK Telecom, and Elisa) are already leveraging solutions that combine cloud, AI, and Machine Learning (ML) to transform their businesses. But, for the wider CSP community, the question is how to democratize AI and cloud so that these technologies are sufficiently impactful and not disruptive to existing operations.

Nokia’s Cognitive Collaboration Hubs (C-Hubs) aim to blend telecoms, AI, and cloud tools into a coherent offering. The foundation rests with Nokia AVA, a cognitive cloud-based framework that helps CSPs better manage their disparate sets of tooling in their operations. Nokia’s C-Hubs builds on Nokia AVA but with a broader scope and scale. Specifically, Nokia focuses on four strands: helping CSPs improve subscriber Quality of Experience (QoE); transforming operations, i.e., alleviating operational complexity and reducing costs; balancing Capital Expenditures (CAPEX) and performance; and pursuing data monetization use cases and unlocking additional value for CSPs that sit on vast pools of mostly network related data that remains unexploited. Nokia aims to bolster its C-Hubs undertaking and further augment its ecosystem that revolves around AI and data-driven processes, which will enable CSPs to optimize and streamline a broad array of processes and systems spanning RAN, core, and transport (scope) across a wider geographic and technological footprint (scale).

Nokia claims that C-Hubs is predicated on open thinking, the right mix of skills, a collaborative approach, and leveraging best practice. These pillars bode well for CSPs’ quest to embrace software-centric networks. On the other hand, however, they touch on variables that fall outside of a vendor’s boundary anchored to mission-critical networking. For example, building a cloud-native platform is an aspect that calls for a different set of capabilities. To that end, Nokia’s recent collaboration with Microsoft is a partnership example that offers CSPs a combination of deep telco networking expertise and hyperscale intelligent cloud best practices. Further, achieving the right mix of skills and human capital to operate these ‘“intelligent” platforms is another key piece of the puzzle. It is not so much about products and associated features as it is about establishing the right operational context, a fitting AI-plus-human model for both Nokia and its customer base.

Nokia’s AI ecosystem aims to democratize “intelligence” by making the upper layers of analytics as reusable as possible. This is a departure from bespoke implementations of the past. For example, Nokia’s collaboration with StarHub is a joint endeavor to institute new and reusable AI assets (e.g., crowd insights on public transport). This AI fabric enables CSPs to shift their operations from reactive to AI-assisted and, eventually, to closed-loop operations in multi-vendor environments. This is a starting point for new “horizontal” growth forays into enterprise verticals. Increasingly, the ability to think horizontally by connecting disparate tools using a cognitive platform will be a priority for CSPs, and one Nokia is addressing.

At present, no vendor commands the telco AI market. Market dominance is contingent on vendor positioning, the size of the opportunity at stake, and CSPs’ appetite for cognitive platforms. Nokia is putting a stake in the ground with C-Hubs and its recent partnership with Microsoft. It is rational to assert that vendors’ relationships with CSPs are taking a different form, and one that Nokia seems to have grasped. CSPs are seeking partnerships in which the cognitive layer is provided by vendors, but vendors’ challenge is to combine their telco expertise with disciplines like data science, DevOps, and software engineering. This is precisely what Nokia—like few other vendors—is prioritizing as part of its cognitive C-Hubs endeavor. When that is a priority, then we start to think of a horizontal chain of command for value creation that rests on a common software and cognitive platform.

The industry’s quest to fuse AI with cloud-native platforms represents a new naturally horizontal play. There is, therefore, a steep learning curve to conquer before these “intelligent” platforms are widely deployed into the wider telco ecosystem. For vendors, the impending “flattened” landscape constitutes an opportunity to redirect investment and energy toward creating products that are easy to consume. Furthermore, vendors should seek new partnerships and value chains that leverage cloud tools to horizontally piggyback on a telco AI ecosystem. Speed is the engine of digital transformation and complexity remains the anchor. The challenge lies not in knowing where to go but rather in how to get there. The wider vendor community should take the lead by addressing the “how” piece of the puzzle and the AI ecosystem that Nokia advocates is a first step in that direction.

For CSPs, an AI ecosystem is going to be at the center of new commercial forays, particularly enterprise 5G, which inherently constitutes a horizontal value creation. CSPs will capture growth if they get three strands right: the intelligent connectivity to connect with cognitive platforms; the education to get their workforce innovating on, working off of, and tapping into the telco AI ecosystem; and finally, the governance to get the best out of this ecosystem and cushion its side effects. It will take time for this “flatter” playing field and new business practices to be fully aligned, but when full alignment is in place, CSPs will be able to source the best cognitive offering (i.e., product, service, capacity, or competency) to accelerate transformation and commercialize new use cases indiscriminate of verticalized country- or region-specific deployments.