Chris Buist, Coleago Director, chaired the second day of Informa’s Managed Services for Growth Markets conference in Istanbul on 25-26 May. These are his key takeaways from the event:
Cost reduction will nearly always be the overriding driver for Managed Services (MS). It is particularly the case for low-revenue, CapEx-constrained operators in growth markets who need to invest in their networks to cope with rapidly-increasing data traffic and deep-pocketed competitors. However, most operators now recognise and demand other value-adding benefits such as resource flexibility, access to special expertise, customer experience improvement, and more. Surveys show that many MS Providers (MSPs) are not great at communicating their value-add capabilities or delivering it – though the latter may be due to operators having unrealistic expectations, for whatever reason.
Network virtualisation using NFV and SDN is garnering considerable interest from growth-market operators but most are watching the tier 1 operators’ pilot projects to hear what the benefits and pitfalls might be before deciding what to do themselves. Some think that it might take a decade to take off in their markets although there are many cases nowadays of growth-market operators leapfrogging their developed-market counterparts. It certainly looks as though it will have a significant impact on MS as operators will need experienced MSPs to help them plan and execute the transformation. The more recent trend from single sourcing to multi-sourcing might even be reversed as a consequence.
Regardless of one’s views on the time-frame for network virtualisation, almost everyone agrees that network-IT convergence is happening anyway and that a key enabler is the organisational merger of the network and IT departments. Some developed- and growth-market operators have already embarked on the journey but, as many people know from painful experience, organisational change is often far more difficult than technology transformation. Best-practice change management is the only way to address the challenges and mitigate the risks with particular attention to the “softer factors” such as culture, leadership, recruitment, training and development.
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