Adding Mobile, From The Ground Up
Charlie Elliott never got his engineering degree. He fell in love, he says, got married,
and needed to get a job. The one he got was building electric harnesses for
a company that made coin-change slot machines.
An operations support system (OSS) and a business support system (BSS), in combination with other back office software, is the foundation that a service provider builds a new product upon. After all, there’s no point in having a product you can’t provision, or bill for, or manage.
Historically, each successively added service has been built on its own dedicated OSS/BSS, possibly but not necessarily integrated with extant OSS/BSS systems deployed for services offered earlier.
Minimal or no integration – the silo approach – is understandable. Melding enormous databases is an endeavor even pros quail to attempt lacking a compelling reason.
But business models have a significant bearing on the form and function of OSS/BSS systems, and cable will have to first figure out the business model for cellular service.
The introduction of VoIP is a relevant precedent. VoIP was introduced as a flat-fee service, and there were business advantages to that. Pricing in traditional telephony began eroding rapidly long before the cable industry got into the phone business. That the price of a call was already being inexorably driven down to fractions of a cent was a disincentive to charging per call. Furthermore, customers saw a value in flat fees.
Meanwhile, the OSS/BSS for a service based on flat-fee payment, such as video, differs from an OSS/BSS for a transaction-based model, such as wireless telephony. From an OSS/BSS standpoint, a flat-fee model is a simpler implementation.
Video and VoIP can be bundled and the charges can go on a single bill even if the OSS/BSS systems remain in their separate silos, but an OSS/BSS system for one flat-fee service is generally easier to integrate with another built for another flat-fee service. That is certainly easier than integrating a flat-fee OSS/BSS and a transaction-based OSS/BSS.
So there are some good arguments to be made for introducing cellular also as a flat-fee service. If an MSO were to make a move in mobile right now, flat fees would be attractive.
But none of the majors appear ready to do so.
“Cable is looking for the next big lump of money, and that’s commercial services,” noted JacobsRimell CTO Dave Jacobs.
That plus DOCSIS 3.0, PacketCable 2.0, and the addressable advertising thrust (Project Canoe), all combined with limited engineering resources means that cellular telephony, as important as it may be, is naturally a lower priority.
It’s comparatively easy to become a mobile virtual network operator (MVNO), a company that provides mobile services using the assets and infrastructure of a company that has the spectrum licenses, cell towers, switching centers, etc. This is essentially the path taken by some of the largest cable operators, including Comcast, Cox, and Time Warner Cable, to provide the Pivot mobile service, with partner Sprint. Sprint, not coincidentally, took care of developing the bulk of the new back-office software necessary.
But Pivot has largely failed. It is possible Pivot could be reinvigorated, but given the level of dissatisfaction among the partners, that’s unlikely.
Nonetheless, there are other options, notably T-Mobile and the Sprint-Clearpoint WiMAX venture.
Still, few expect cable to do much more in mobile services anytime in 2008, and probably not until well into 2009.
Sharing that view are OSS/BSS vendors, who say they are preparing for anything that MSOs decide – the implication being that few if any MSOs have made any such decision.
Meanwhile, several cellular carriers are already offering flat fees. By 2009, flat-fee price plans are liable to be even more widespread. Cable is going to have to think of some other value proposition.
One possibility is not just bundling cellular with a flat fee, but enabling fixed-mobile convergence (FMC). The scheme depends on a dual mode handset that can connect to both a cellular network and to an IP network – in this case cable broadband, via a wireless link (Wi-Fi, or some other standard in the 802.11 family).
The value to consumers would be the ability to use a single handset at home and while mobile, all on a single service plan. That many are canceling their traditional phone service in favor of mobile service only is indicative that the approach could be successful.
Operationally, enabling that sort of thing will take some doing, and it’s not all tied up with the OSS/BSS. In fact, business arrangements and communications standards will probably be the more prominent issues.
But people are going to expect to be able to start a call at home, walk out the door, jump in the car and go, without losing the call. If a dual-mode handset is going to be truly useful, it should be able to seamlessly hand off a call from one network to another.
While that example features the consumer, the capability is more likely to be attractive to business users. But whether for commercial or residential, MSOs must be able to have access to, and some operational control of, their wireless partners’ mobile switching centers. For that, they will have to set up SS7 (Signaling System 7) triggers with their wireless partners.
In the office (or home) the dual-mode phone becomes a client of the PC. The handset operator can send a text message to any other mobile handset. If the person receiving that text message replies, the reply will go back to the original caller’s PC, not to his handset – unless the MSO negotiated the handoffs with its wireless partner first, according to Randy Waters, VP Market Development, Comverse CIPC Americas.
Another protocol cable will have to familiarize itself with is ENUM (which, improbably, stands for telephone number mapping – don’t ask). ENUM is a set of protocols to map the telephone numbering system with the DNS numbering system used by IP networks.
Cable has its own standards that will have bearing on how they introduce mobile services: PacketCable 2.0.
So that’s bundling and pricing, but what if a cable operator wants to get fancy with services?
Cable’s forte is video, but implementing video on mobile would be technologically difficult, billing and provisioning it would be difficult, and given restrictions on current wireless broadband networks, it would be hard to provide a quality product that could be demonstrably better than, say, Verizon’s VCast.
It might not be worth it anyway.
“To me, TV on mobile is a novelty, not a successful business model,” said Fran Heeran, CTO of Valista. He was one of several to point out that Disney and ESPN tried to market mobile phones and phone services that came with (presumably) value-added services, and they both failed.
But the integration of multiple services – convergence – could make a difference for service operators.
For example, say a customer orders “Enchanted” through VOD, and the operator wants to tag on an ad at the end of the film that gives the viewer the opportunity to immediately buy and download a ringtone of one of the songs from the movie.
Or what about simply programming one’s PVR from one’s mobile.
Some people argue that consumer expectation will force service providers to get that fancy, and the first service providers to do it will win.
It’s simply the dynamics of the Internet, says Steve Menear, assistant vice president of business and market strategy for Comverse Intelligent Networks. It happened in the travel business (e.g., Expedia, Travelocity), in the auction business (eBay), the classified ads business (Craig’s List), and in the education business (the University of Phoenix).
“It’s all events-based,” he said. “As a consumer, I want to know instantly what I’ve spent, what I’ve been charged.”
That type of capability could become an important element of supporting customers.
Rick Baca, Convergys’ vice president, cable program management, said, “Customer service will be the key. It’s easier to maintain a customer than to go out and get a new one.”
If all that plays out, the OSS/BSS will be absolutely critical, and it has to be open, and if not monolithic, it will have to behave as if it were. Different vendors are at different stages of enabling all that, and they all vow to have products ready should MSOs decide to go that way.
Another bit of integration that OSS/BSS vendors are working on is that of prepaid and postpaid systems. Wireless service providers have tended to start as one or the other, and if they do both, the back office systems are in separate silos.
If the two were integrated, suggested Convergys’ Baca, a service provider could offer a potentially valuable service. What if a provider offered a plan where the phones used by the adults in a household were postpaid, but the phones of their children were treated as prepaid so that phone privileges couldn’t be abused?
Under these circumstances, Menear points out, OSS/BSS won’t be just a necessary evil, it will become a services engine.
If an MSO expects to get creative with services and applications, it is going to have more than just a new OSS/BSS silo to bolt on to the ones it already has.
OSS/BSS companies are anticipating that, and are doing their best to be prepared. The trend appears to be setting up the software so that the customer (the service provider) can specify the service and implement it, without having to get the OSS/BSS vendor involved – a very recent approach in the OSS/BSS world.
The new applications that come out of the convergence of communications, computing, and consumer products may also come from third parties. There’s no way any service provider is going to be able to keep up with all the possibilities.
The only option is to give third-party partners access to the OSS system. OSS, said Sigma Systems’ CTO Brian Cappellani, is going to get pushed to the edge of the network.
OSS at the edge is where security, entitlements, permissions and policies are managed end-to-end. Cappellani described the idea in detail at ET ’08, in a paper with the fanciful title, “OSS at the Edge for Service and Application Enablement.”
Cappellani said that where MSOs now have network policy, convergence is going to force a shift to session policy.
OSS at the edge will have to be a new layer in the network, abstract enough to be dealt with by third parties who may know nothing about cable networks. The ramification is that billing, credit checks, and the sharing of demographic information will all have to be conducted on the fly.
Any single OSS/BSS vendor should be able to enable all that. The problem is that every provider would get a custom solution, which is exactly the opposite of what is necessary to make convergence work at all, let alone work well.
In the past, service providers could perhaps get away with relying on OSS/BSS providers to come up with all the answers for OSS/BSS systems, but convergence is going to make that impossible.
Convergence might be two years off, more or less, Cappellani said, but the entire industry ought to be putting thought into this now.
Most operators will, by necessity, be MVNOs. But in the recent 700 MHz spectrum auction, Cox, Bresnan, and Paul Allen’s Vulcan Ventures all won licenses. That could put them in direct conflict with wireless companies they might have to do business with, so it will be interesting to see how that plays out.