How blockchain is revolutionising telecom business support systems

James is editor in chief of TechForge Media, with a passion for how technologies influence business and several Mobile World Congress events under his belt. James has interviewed a variety of leading figures in his career, from former Mafia boss Michael Franzese, to Steve Wozniak, and Jean Michel Jarre. James can be found tweeting at @James_T_Bourne.

Sponsored The business support system (BSS) remains the lifeblood of any communications provider. You can spend all you want on the network, but if you want to get that fast speed to a customer and make it useable, you cannot neglect the back office.

If you have an ageing BSS, your very survival could be at stake. These warnings have been concerning telecom operators for some time. Take a report from PwC in 2014 which warned about the consequences of not delivering a seamless customer experience. On the other hand, operators need to fulfil the objectives of cost, efficiency and agility if they want to get their upgrade right.

“With BSS at the heart of a business, transforming them means both big opportunities and major risks for any operator,” the report noted. “Poorly implemented transformations have negatively affected what customers experience – including unexpected changes in products or bills and disrupted service – and have led to substantial customer churn. Yet for those that get it right, the upside is equally dramatic.”

This two-way street can be seen with regards to the swathe of emerging technologies entering the telecoms landscape. Customers want the future now, whether it is 5G, artificial intelligence, or M2M technologies. But can operators benefit from these?

With blockchain – cited by an analyst earlier this year as the biggest technology since the Internet –  the answer may well be yes.

In 2016, Deloitte noted that blockchain could help CSPs when it came to financials. “In an environment of heightened competition in an increasingly digital world from infrastructure-light OTT players, together with decreasing revenues from voice and increasing costs due to high bandwidth demands,” the consultancy wrote, “there is a need to both reduce costs and find new sources of revenue.”

Today, the potential of blockchain in telecom can be located in four silos; three inside the telco ecosystem and one outside. These focus around security and fraud prevention, cost optimisation, new revenue streams, and – outside telco – vertical opportunities. The latter is important to note; while there are challenges unique to industries such as healthcare and transportation, blockchain links them through revolutionising the supply chain.

Supporting OSS and BSS processes, however, sits firmly in the cost optimisation silo – and this is where an interesting collaboration comes in. Nexign, a BSS provider for operators, is working with Bubbletone, a company focused on blockchain solutions in the telecom space, to develop an industry-first combined solution, modernising BSS systems, giving CSPs the ability to collaborate with each other  and enabling new monetisation streams.

There are various benefits to the combined solution, including joint software development and marketing activities, as well as sales co-operation. As it is based around blockchain technologies, it shares its most important principles, from high availability to an open and transparent environment.

Take roaming as a key example on the cost optimisation side. A typical structure for many North European operators is up to 90% of its revenue to be local traffic, with only 10% being based around international roaming. Of that 10%, more than half belongs to high season peaks. As a result, there is a sizeable disparity between demand level and revenue coverage – and there is a very low level of flexibility for discounts inside current roaming agreements.

Big players in the market seldom trust each other – and it is a similar case with telecoms. But with a blockchain owned and controlled by mobile operators, a visiting operator can offer a product, a home operator can buy it, and then sell it to a subscriber.

In a wider context, this is focused around creating a new global marketplace for digital identities. Whether it is through eSIM profiles, IoT tokens or ASP subscriptions, blockchain technology can help validate an authentication service bundle provided by operators. Keys and sequences can be generated, and then the offering can be sold to partners.

For telcos, this is a clear call to action. According to a report issued by ResearchandMarkets in July, the marriage of blockchain technologies to telecoms will generate a market cap of $993 million (£762m) by 2023. Other research suggests that this figure may be a conservative estimate.

It is therefore vitally important for telcos to understand that they can become the backbone for the blockchain economy. They can be first to market, forge new business models, both B2B and B2C, and work with organisations of all sizes. Operators need to create a strategic view and a strong, long-term roadmap, in order to secure this opportunity, realising cases inside telecoms as well as in different verticals.

To do this, collaboration is vital. Communication service providers have authority when it comes to large customer bases and regulatory environments; however innovation is more of a weaker area. Nexign’s partnership with Bubbletone shows how a BSS provider and a blockchain company are working together to create new opportunities for operators – it is up to them now to take these.

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