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Deploying next-gen applications beyond video

Every legacy telecom service will need a next-generation successor. Video consumes a lot of bandwidth, but "fat bit" services like unified communications will help maintain revenue.

The fact that most network operators worldwide are thinking very much about video content when they talk about advanced services is demonstrated not only by the buzz IPTV and other video offerings receive, but by the financial commitments those operators have already made in deployment.

Still, it's clear that while video is an important piece to the services-of-the-future puzzle, it's not the only piece. In fact, all of the "legacy services" now offered have to be supplemented with successor concepts or their revenue stream will inevitably decline to near zero, which would only increase the challenges new services would then face.

Content services have the advantage of consuming large amounts of bandwidth, and with revenue per bit declining sharply (by 50% per year, according to an EU provider) increasing the number of bits consumed is one approach. Unfortunately, content services may be the only credible strategy that can support this simple remedy. Voice calling has long demonstrated virtually no price-demand elasticity, and the same holds true for enterprise networking.

A good bit is a "fat bit"

If increasing traffic isn't the way to create new-age, non-video services, what is? The emerging answer is what has become known as "fat bits." A fat bit is a service that adds features beyond simple connection and transport, and so builds incremental customer value that can justify incremental customer payment. The industry has long known such services. In the 1970s, they emerged as "Custom Local Access Special Services" or CLASS, which include regularly used features like call forwarding and caller ID. The issue today is how to develop successors to this early set of service enhancements for voice and to develop similar enhancements for other services.

Unified communications is the best-known example of a facilitation-based enhanced service.

Tom Nolle
CIMI Corp.

Two general classes of "service enhancements" appear to be available: "facilitation" and "substitution." Facilitation enhancements seek to add value to a service by adding features that facilitate its use. Call forwarding is such an enhancement. It allows a call that would otherwise be "ring-no-answer" and non-billable to be billed. Substitution enhancements seek to transfer some of the cost of using or supporting a service from the user to the provider in return for a fee. Managed services are an example of substitution services, and they have been popular in Europe for decades and are gaining credibility in the U.S.

"Unified communications" is the best-known example of a facilitation-based enhanced service. The essential value proposition is to integrate voice (and video) communications more with collaborative processes and even with applications within an enterprise. This not only drives up value, it also drives network usage. In data services, facilitation enhancements have been used in electronic data interchange (EDI) in the past, and have recently been tried in areas such as the publication of enterprise web services via a UDDI.

Issues in "beyond-content" service enhancement

The common issue for network operators in either form of "beyond-content" service enhancement is the increased reliance on feature hosting and software-based service and operations management, and the need to couple hosted network intelligence with service signaling. Each of these generates its own special issues.

Hosted features introduce IT processes into modern network services, as opposed to device-embedded processes of the type that drove voice service enhancements in the days of Class 5 switches. Five-nines reliability of network hardware is a popular (and almost universally achievable) benchmark, but that same level of reliability is not at all common in the IT world. There are also significant voids in the management of hosted service components, voids that bodies like the Telemanagement Forum (TMF) are working to fill.

Signaling is perhaps the most overlooked requirement of non-content services in all of modern networking. In telephony, the signaling network has always been separated from the data plane (SS7). But in converged IP networks, SIP signaling and other signaling travels in the same network as user data and contends for capacity and priority.

Even architectures that explicitly separate signaling into a layer (such as IMS) don't actually separate the signaling network. In fact, there are no broadly deployed and provably successful strategies for accomplishing signaling separation in IP networks, and that void means that traffic management practices may have to acknowledge the specific needs of signaling traffic by insuring that all traffic meets signaling requirements for delay and loss.

The final issue for non-content services is the issue of dynamism. Building service value by supporting customer behavior in a precise way is financially critical but also requires a highly flexible and responsive service application development process. Initiatives like Google's Android open handset alliance have aimed at making even mobile devices flexible by introducing a platform accessible to a broad development community.

There is no similar process at work in creating flexible processes with fast market response time within the network cloud. Service Delivery Platforms may harden a server for carrier operation, but they don't create a framework to bring web development to carrier infrastructure ... yet. It would be easy to make the argument that non-content advanced services are the most critical piece in the future revenue puzzle, but if that is true, then they are still largely a missing piece.

The path to success in these services is far from clear, and one operator's view was that "there is more action among competitors for the UC space than there is between competitors and their customers." That is likely to change as the market attention given to topics like unified communications raises user awareness and develops a map of requirements that can sustain a real market. Since that could happen literally at any moment, providers must be prepared to play a role in these new services in the near future.

About the Author: Tom Nolle is president of CIMI Corporation, a strategic consulting firm specializing in telecommunications and data communications since 1982. He is a member of the IEEE, ACM, Telemanagement Forum, and the IPsphere Forum, and the publisher of Netwatcher, a journal in advanced telecommunications strategy issues. Tom is actively involved in LAN, MAN and WAN issues for both enterprises and service providers and also provides technical consultation to equipment vendors on standards, markets and emerging technologies. Check out his SearchTelecom networking blog Uncommon Wisdom.

This was last published in May 2008

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