How businesses evolve

It’s useful to understand how over the recent years, big businesses have reinvented themselves. I was reading an article recently on the departing Ericsson CEO Carl-Henric Svanberg, which gave an insightful account of the issues facing Ericsson after the dot-com bubble had burst. His model solely focused around consolidation, whilst others in their market either spread themselves extremely thin in looking for new markets to expand into (see Marconi) or acquired rivals to try and quickly expand (see Alcatel-Lucent). What Carl-Henric Svanberg did with Ericsson was to really consolidate, concentrate on their core business of building networks and inevitably cut costs. This worked, and he now leaves Ericsson today in the healthy position of having 40% of all mobile calls made on their network. I think a lot of companies get excited by the profits and market share available to them when they look outside of their domain. 2 large enterprises who are having mixed results are Google and Cisco. Although Google is still king of search, it’s increasingly more lucrative and more prestigious projects such as Google Books are starting to sap resources from it’s search empire. This has had the effect on competitors like Bing taking more market share.

It was also interesting to see how emerging technologies helped to spur growth in the ailing company. Although a large proportion of their spending is still attributed to legacy networks, opportunities increasingly present themselves to expand into so-called next generation networks. 3G networks are fast becoming their bread and butter, with customers such as Three (3) and T-Mobile in the UK having Ericsson infrastructure to power their data networks. Moving forward, with the advance of M2M, Carl-Henric Svanberg thinks that there is the potential for roughly   sim cards to be embedded into devices as seemingly mundane as fridges, microwaves and washing machines. This is where he envisages Ericsson’s next market shift. There’s no doubting the strength of the mobile data market. Whether it hits a natural saturation period or whether advance such as LTE will help it break through it’s glass ceiling are anyone’s guess. However one thing is certain. Due to the requirement for people to be connected on the move, this is definitely a market that will be key for a long time.

Adding value with broadband

Thought I’d include an article that I’ve recently written for the channel. It’s quite easy to read, but any feedback would be appreciated.

Thanks

Broadband has come a long way since it’s inception. For businesses back in the day, it was seen as a key marketing and communication tool as companies paid through the roof to have a static website with 5 pages. Email was revolutionary, and was quickly seen as the main way to communicate with clients, with their permission or without.

Now with the advent of converged or unified systems, it’s not surprising to have a company use their broadband for phone calls, data, video and even an alarm system. The advance of broadband has been the key driver in so many industries, each with their own confusing terms and acronyms. FMC, UC, SIP, Telepresence, VOIP, IPCCTV. The list goes on, but the common factor is IP – Internet Protocol. All the aforementioned use the internet.

On it’s own, its a cost effective method to transfer data, and because of it’s universal acceptance, is widespread across a number of mechanisms. Packaged with an IP application, broadband becomes fundamental for the efficient use of the respective device. For the channel, it provides a number of opportunities for vendors, distributors and system integrators alike to provide a necessary value add to their portfolio, and this is further pushed by the rise of alternative networks to use. This in itself has promoted competition and innovation in product development, and the channel has inevitably benefited from the options available. Now technologies such as Annex-M can help a reseller by going to market with an ISDN alternative, whilst also aggregating two or more to attack the leased line market.

At the top end of the channel, mobile operators have got into bed with Telco’s to have a network of their own. Large system integrators are courting network operators for a primary service. And at enterprise level, the wrath of mergers and acquisitions have left some in the enviable position of being a one stop shop for your every need, budget permitting. At the lower end, traditional resellers and SI’s have forged relationships with mobile and network operators to get the best out of both worlds. This is where the value has been added, as now an integrator has a platform to showcase their primary offering.

Lets look at one industry where this is rife, voice. Hosted voice providers who have been brave in embracing SIP have realised from a very early age that the quality of broadband is key to their offering. Therefore they have been vocal in their search for network operators who have an offering that can allow for a high quality and a high volume of calls.

Enter DSL. In it’s various guises, it’s been able to offer a low cost platform to end users wanting access to the benefits of a hosted voice offering, as now the high upfront costs of an ISDN 30 can be waived for a similar DSL service. In this instance integrators have been quick to partner with network operators to offer their services as part of a package, adding to their bottom line by boosting their margins and increasing that customer ’stickiness’ we all strive for.

The same is now happening in a number of industries. Integrators in the fast developing video sphere are reaching out to networks with a reputation for performance. Digital signage architects are holding hands with networks with good national coverage. And for the end user, this is compelling as they have one port of call for the majority of their IP requirements.

It’s an easy story to tell. To borrow a much used analogy, selling a road is pointless without drooling over the performance of the vehicle that’s on it. And to translate this to the internet, it’s hard to get excited about fibre to the home for example, without thinking about all it’s possible uses.

All these present the opportunity for more convergence, more applications, but over one central pipe, which is where the value is provided, as if you provide the central pipe, there is always the possibility to provide other services based on that. An old director of mine used to term this “The Whirlwind model”, where you provide something small, but essential, and then provide additional services required by that initial item. However you define it, the benefits of this are unparalled for all parts of the channel, as with the technological advances being made in the numerous access methods used to provide broadband, the channel now has a chance to offer a key value add to their IP applications.

BT and O2 join up

Interesting news in the channel recently about how O2 have signed up with BT Wholesale to provide both fixed line data, broadband and consultancy services. On the surface this seems like a good opportunity for O2 to take a giant step into providing their client base with a converged solution based around their primary mobile offering. However one has to wonder why a comapny who has invested at the least £200 million on it’s own network would then make a further investment in providing a similar service based on another network.

The concept is sound. O2 have a massive mobile subscriber base, consisting of both consumers and businesses of all sizes. With their centre of excellences, they have one of the best support networks around for resellers of their products, to underpin their business offering. By offering their clients a unified solution consisting of business broadband seems like a sure fit. However, for one reason or another, this has never happened.

The acquisition of the Bethere network has enabled O2 to be a major player in the comms market. However so far, the market that has benefitted the most has been the residential market. This does not mean that the network cannot be used for businesses, just that so far, there have been few able to use it in this way. However with the advent of the wholesale channel, the network is now being used by business ISP’s as a primary offering to their client base, and is proving extremely successful in providing high bandwidth low latency services. As more exposure is given to this channel, it will be interesting to see how this is viewed by the powers that be in O2.

There’s nothing to say that a Be/O2 offering can’t co-exist with a BT service, as inevitably in the areas where Be don’t have an exchange unbundled, a rebadged BT service will be used. However, for my 2 pence, although BT Wholesale have persuaded O2 to sign a 5 year contract, I firmly believe that O2 will fully realise what an asset they have with the Be network, before we get anywhere near to the expiry date of their new contract with BT.

ADSL2+ Annex-M Comparison

We’ve been working on quite a lot of marketing info in recent weeks, to showcase the properties of Annex-M ADSL2+ compared to services available in the market currently. Seems that quite a lot of the channel either is not aware of either the efficiency, speed or cost to their client base of Annex-M, or is awaiting the arrival EFM. We’ve recently installed a demo suite in our offices to demonstrate our Annex-M in action against that of other carriers. We can also showcase our MLPPP platform in action, and the results we’ve obtained using this. The below graph helps to show not only the price point of AnnexM, but also how well it can perform in optimum conditions.

Annex-M ADSL2+ comparison graph

A large number of our client base who use our Annex-M services do so to underpin bandwidth intensive applications, where traditionally they would have deployed a costly leased line or legacy SDSL circuit. This helps them to decrease their overall cost of ownership, whilst improving on the performance of the applications they run within their network.

The big Twitter debate

Over the last two years, Twitter has taken the Internet by storm. Early adopters (myself included) saw it as just another method by which to communicate to your network, and dismissed it on this basis. However, as celebrities such as Britney Spears and Ashton Kutcher started to jump on board, Twitter slowly started to become more of a mainstream media tool. This was further enhanced by events such as the River Hudson plane crash and the terrorist events in Mumbai. Now Twitter is seen as a fundamental broadcasting medium by many to obtain relevant news.

However, the problem with Twitter is that there doesn’t seem to be any obvious way to monetise their service. They have a massive subscriber base, all of which obtain a free service. Now they even have a large enterprise and corporate client base who use their service not only to promote their brand and products, but also to connect with their client base. Due to the size of Twitter’s user base, the temptation is always there to sell out to a larger player, and there has been a lot of speculation relating to an acquisition by Google. Real time search is the one area within their portfolio that they’ve had problems coming to terms with. However, with Twitter’s real time feed suddenly Google would have specific relevant information about up to date trending topics, of which to target their adverts too. The immediate benefits of this are there for all to see. Google can instantly monetise a service that currently does not have any obvious income stream. Whilst for Twitter, they have direct access to Google’s massive resource pool to be able to compete against the likes of Facebook, who with the acquisition of FriendFeed are slowly encroaching into the space of real time search. Also, Google’s track record of amalgamating newly acquired assets into it’s estate is strong, as is shown by the success of both YouTube and Blogger being able to keep their brand identity and prove successful in their respective markets.

However, Twitter does have an ace up it’s sleeve. With the use of hashtags, Twitter has a direct way of keeping a handle on the latest trends being discussed. They have large investors behind them providing them with the capital to increase their infrastructure. Also, despite the fact I mentioned earlier that their lack of an obvious business model was a problem, it definitely constitutes a nice problem . Currently their valuation is built solely on their subscriber base and their infrastructure. The minute they disclose their intentions, their value would rocket to potential investors, and may well even see them go down the IPO route. Remember that the guys behind Twitter are also the same guys that started Blogger, and sold it successfully to Google.

For my two pence, I think that Twitter would be silly to ignore the threat of Facebook, and sell in a hurry to the likes of Google and Apple. They have an extremely strong brand and an even stronger user base which they can use to their advantage. And just as Google did with the implementation of Adwords, if they can find a way to monetise the mammoth amount of hashtags flying around, I think they would stand a good chance of seeing off the combined Facebook/FriendFeed threat.

What people want

So far, our new wholesale department has been receiving a lot of publicity in relavant publications. This has resulted in a lot of enquiries from other ISP’s looking to have access to Be’s AnnexM services. A number of interesting converastions have been had with various commercial and technical bods, as to the level of service they require for this to fit into their portfolio, and as such, it’s been extremely interesting for me to see what people really want from their carrier.

Having been on the other side of the fence for so long, it’s nice to see how some of these requirements mirror my own image of how a carrier should provide a service. Features such as full visibility and control of the DSLAM for diagnostic purposes shouldn’t only be provided to ‘premier’ partners, but instead should be made available to every partner. Having access to a UK based support team that talk ‘your language’ (instead of the language of BS…) should also be something that is prevalent. Having to raise a ticket and wait for up to 4 hours for a response stating that “our enquiry has been received” in this day and age is not how ANY company should operate. Let alone someone in telecomms.

It’s also interesting to understand how partner’s envisage their client’s usage, and how their requirements change appropriately. For clients who want to provide a redundant tail for resiliency to sit alongside a BT circuit, the fact that there are no ongoing monthly management costs and no central pipe charges sits well with them, as it can offer full visibility of ongoing costs for frugal finance teams . For clients who have a large voice estate, the amount of bandwidth afforded helps them to provide a large number of channels to their client base. For clients who use these within a bonded platform, the ability to look at live DSLAM stats, see error seconds and turn off interleaving means that you can obtain the best performance for your platform.

There are going to be requirements that the channel does not meet. However, in these instances, it is important to keep the lines of communication open between partner and carrier, so that any feedback that is obtained, is seen to be acted upon. This is exactly how I would want to be treated as a partner, and hopefully is the level of service our partners will come to expect as the norm in their dealings with us.

Fluidata/Be Wholesale offering

It’s been an exciting couple of months at Fluidata. We’ve always known the potential of AnnexM as a direct replacement for legacy SDSL. We’ve gauged how popular it’s been within our own client base. And we’ve been successful in aggregating it with services from other carriers. However, my own feeling that there has always been potential to offer a true wholesale platform around AnnexM is now being realised. Over the last few months there has been a lot of discussions between ourselves, Be and O2 regarding the best way to make this viable. Sometimes these conversations have been prolonged, but it’s now a reality. And a unique one at that.

Because initially the Bethere network was deployed specifically for transferring data, they have always made the invesmtent to provide services that allow for high speeds and little contention. By provisioning NTL based 1Gb and 10Gb fibre backhaul at their majority of their DSLAM’s, they’ve limited the possibility of contention arising at these points. Also, backed by O2, they’ve been able to proactively monitor contention throughout their network. This has proved attractive to a consmer audience that regularly uses services such as online gaming and P2P. However, this also has had it’s advantages to businesses who also hold similar values.

Now other ISP’s and service providers can have access to the largest AnnexM ready network in the country. With an ethos of ‘ease of use’, the flexibility afforded allows for maximum control of each tail. From full port functionality to no capacity charges, this offering really does make it easy for partners to fully provision, maintain and support their circuits in a way rarely seen within the industry. By delivering the platform via L2TP, partners now have the ability to compliment their existing centrals with a progressive NGN offering.

For me personally, managing this offering will be a new challenge. After being on the receiving end of a few channel offerings, I have an insight into the levels of service a channel partner may expect. Hopefully this will translate itself into a channel experience beneficial to both ourselves and our partners. If the last few months were exciting, the next few will be even more so!

Margin in Voice and data

I’ve been to a few exhibitions this year and although they have still been busy, they haven’t been as busy as their respective events last year. Events such as Internet World and the IPTV forum proved extremely popular last year, and in this economic climate, I guess it is only natural that there were cut backs in the number of attendees. From my perspective, it’s hard to justify spending a whole day out of the office traipsing from stand to stand to listen to numerous pitches about services that seem to do everything and nothing at the same time.

However, yesterday was different. I haven’t been to a ‘Margin in Voice and Data‘ expo before, but registered to attend a few months ago. However, shortly after registering, I received notice from them that due to economic pressures, they were changing the format of the expo to an invite only affair, and that I should wait patiently to receive my invite. Admittedly I thought this to be a clever ploy, and assumed that they would go ahead and invite everyone who showed an interest. And when I received my invite, I was less than shocked.

I traipsed to Twickenham yesterday morning, to see a lot fewer numbers than I expected, but right from the onset, everyone was very sociable and happy to talk about the challenges they were facing currently, and how they were pulling themselves out of it. The big boys from Opal to BT Wholesale were present. However, the real value to be had was in talking to smaller resellers who maybe didn’t trust those with big shiny stands who talked a lot, but hadn’t delivered for them in the past. This element has been missing from previous events I have been too. And it made it so much more worthwhile. I was put directly in front of prospective clients, and understanding their current issues. I suggest other event organisers take note as the intimate nature of this made this event so much more relevant, and resulted in both myself and my colleague getting extremely well qualified leads to work on.

The shift in working practices

This is a guest post by one of my colleagues Max Stoner.

The rigid 9-5 structure that underpins Britain’s working week is something we’ve probably all questioned from time to time. In truth for most of us this has manifested itself in more of a meek whine or lament than an outright challenge to it, but even  louder and more boisterous voices of  discontent have often been undermined by a lack of belief; not necessarily in their our own powers to change, but in the working week’s capacity for significant change.

Until now that is…As currently the very structure and philosophy of our working week is under greater threat than at any other point in recent times. And if for a second you’re thinking of some recalcitrant movement; all dreadlocks and rotests and other musty wafts of non –conformity, then think again..

Because the role of agent provocateur in this attack on the working week, is in fact fulfilled by government backed initiative WorkWise UK. The organisation comes armed with fairly aggressive rhetoric about “consigning the working week to a thing of the past” and bringing about “change similar to the industrial revolution”. This no doubt conveys a pretty radical impression; although one somewhat tempered by closer inspection of their aims and principles.

In brief their raison d’être Is simply “to encourage the widespread adoption of smarter working practices”, which in actuality would equate to a shift towards more flexible working practices, such as an increase in remote working and greater flexibility over working hours. Their cumulative and ultimate goal; to “have 50% of the UK population working mainly in their own home, or in different places using home as a base within 5 years”

In many respects then their intention is not so much to dismantle the structures of our working week but rather to alleviate the undesirable rigidity that has plagued it for so long. Sort of like administering a very old, arthritic man with a super strength, and potentially destabilising shot of cod liver oil.

But why do we need change in the first place? Well to begin with let’s look at the way many of us begin our working day, with that poor excuse for travel we call the ‘commute’.

I accept that these vary in their nature, for many of us they take place in the squashed, cramped, antisocial and sweaty confines of our nation’s fine trains, tubes or buses. For others perhaps within the comfort of their own vehicle: albeit one stalled along a stretch of polluting, noisy and congested motorway that pulsates with palpable tension and collective raised blood pressure.

As well as being about as conducive to relaxation as holidaying in Baghdad, the commute also places stress on our roads and public transport infrastructure, and contributes significantly to environmental damage, because “a car travelling at crawling speed generates over 500g/km of carbon dioxide as opposed to 175g/km it would generate at 100 kph a hour”.

Furthermore recent sociological research seems to indicate that our work-life balance is out of kilter. The majority of people questioned in the 2008 Work and Family Life Report claimed “work dominated their lives, and family life suffered as a result”. The report also concluded that “working long hours led to increased levels of stress, resulting in irritability, exhaustion and depression”.

And if you’re not one for sentiment in respect to the social side effects of British working life, then take note that last year the CBI calculated over £5 billion was lost as a result of mental health and stress related illnesses. And the ramifications this has on our health and welfare sectors, one can only assume to be detrimental.

Workwise UK seeks to paint a picture of our traditional working week as archaic; a moribund relic, ill-suited to the demands of a complex and diverse 21c, wheezing and coughing it’s last polluting breaths of life towards it’s death bed.

Whether we agree with this diagnosis or not, clearly ways and means for us to function in a smarter more adaptable manner, and help reduce the ill effects of work on our nation’s society, health, economy and environment is not just desirable, but commonsensical.

Of course that’s not to say that a shift towards flexible working comes without it’s own caveats. Logistical and practical pitfalls are a plenty and in my own humble opinion success will rely on changing working culture and psychology as much as any legislative measures. But with government schemes like Work Wise, with the proliferation of flexible working over the last decade*, and with government legislation passed earlier this month; giving employees with children under the age of 16 legal  right to request flexible working; what we should expect is for flexible working to start to emerge as more of a concrete fixture across Britain’s working landscape.

While Workwise and other government initiatives are hoping to engineer this change, the principle catalyst in flexible working becoming viable, is technology, as Workwise chief exec Phil Flaxton acknowledges “technology is the enabler here”.

And if technology enables then technology companies are set to profit. The company I work for Fluidata; provides businesses with the internet, and opportunity in this sector is plentiful.

For any employee to work from home or ‘hotdesk’ a working internet connection is almost a prerequisite these days, and while in some cases existing home user connections can be harnessed for these purposes, the increase in demand of the connection will call for,  in others, something more reliable and business orientated. Remote workers also have a causative effect on the wider connectivity requirements of businesses. For example secure communication between sites will need to be achieved via some kind of wide area network, while head office sites will likely require more robust and reliable connections to cope with the influxes of incoming traffic.

Another potential benefactor of smarter working practices, and of a more general shift towards green friendly business practices, is video conference technology. With the ability to transmit real-time and life size video, this technology reduces work related travel, and as consequence saves on time, money and carbon emissions. Although this technology can be deployed over ISDN channels, in many cases the favoured method of deployment is over the internet. Once more, consideration of what kind of internet connection is required here, with low contented, symmetrical and reliable solutions most suited for the technologies usage requirements and mission critical nature.

With such developments likely to force buyers to pay greater diligence towards the finer points of contention, uptime guarantees and resilience, it’s probable that ISP’s who not only provide such solutions, but who also sell on delivery and reliability over headline speeds, will prove to be the more successful.

Flexible, innovative services, and crucially ones tailored towards flexible working should be particularly popular with disgruntled IT managers wanting to ease logistical headaches.

Discussing the contents of this article with my own boss (Fluidata MD, Piers Daniell) was rather illuminating. While not enamored by my cheeky suggestions of 3 pm Friday finishes, and appalled by office murmurings of ‘duvet days’ he clearly sees not only the business opportunities in such schemes but also the need for innovation and adaptation in our current working climate.

“There is no reason that the way we currently work is the right way, businesses can no longer assume that old fixed corporate practices and methods will be successful. Change and disruption can invoke fear, but in times that are fast looking unprecedented in an economic, political and social sense, more than ever companies need to not only ride with change, but to consciously provoke change and disruption through new technologies, practices and methods of working”

Have we seen the death of the ISP?

The good old days

I must admit, the telecomms sector is a fascinating sector to be involved in. Always changing, always evolving, always innovating. The market is almost unrecognisable to 8 years ago, when BT ruled the roost, and we were all left to pick up their scraps. However, the rise of LLU networks has really provided end users with a plethora of choice in terms of obtaining a service that is more suited to their needs. Now one can choose from a range of acronym-ed services to help them support their business. And that is exactly what these services are doing. With the increased pace traditional businesses have moved to obtain a presence on the web, it has become more and more important for them to assess their WAN, starting at the provision of bandwidth. This means agreeing SLA’s with suppliers, obtaining redundant links and having dedicated support lines to access, as well as other key issues. And service providers have responded. Over the last few years, we’ve seen the rise of traditional ISP’s not only providing connectivity, but also diversifying into providing value-add through applications such as AV software, bandwidth optimisation modules and relevant hardware. But even more importantly, we’ve seen a rise in smaller ISP’s taking multiple feeds from multiple networks to increase their offering to their client base and substantiate upon their skill set.

Within the SME market, this was always going to happen, as clients tend to be more loyal to suppliers and consultants who have intimate knowledge of their business practices. However, within the Mid Market and Enterprise sectors, there was still a lot of scepticism around ‘placing all your eggs in one basket’. This is starting to change. With the rise of converged communications, larger companies especially are realising that placing their business with one supplier has a number of benefits that may outweigh the negatives. These suppliers however do not just provide their own solutions. Through a range of partnerships and arrangements with companies who recently may have been deemed as competitors, they have been able to penetrate their market with a unified solution that has a lot more credence than any offering they may have had previously. Take our Advance solutions. One IP range. One router. Two underlying networks. Should one of the networks fail, then traffic is seamlessley routed via the redundant network. Great for business critical applications. Great for the end user.

The rise of the VNO; who has multiple feeds from multiple carriers, has a VOIP offering through an arrangement with a SIP provider, who can offer video conferencing through one it’s partners and privatise a network by offering CPE through a trusted vendor, is becoming a lot more attractive. The key to this is the consultation that happens prior to any agreement. And this is key. In a market where consultants have always had a negative reputation, it’s interesting to see the role they are playing in driving convergence. Because of their expanding product suites, consultants now have a wide range of themes to discuss with their prospects, and more importantly, a wider range of solutions to offer them.

We’ve come a long way since the start of the noughties. And with issues surrounding convergence and virtualisation still unresolved, have a long way to go. To throw my 2pence into the mix, I still think that there is a lot of mileage yet, as ISP’s start to turn into utilities companies through their offering’s and pricing structures. So much to look forward to!