Presentation for Cloud Services Breakfast Briefing · Presentation for Cloud Services Breakfast Briefing 29 March 2011 2 19510-85 Introduction ... changing ICT demands and increasing

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Telco opportunities in cloud services

Gareth Williams

Presentation for Cloud Services Breakfast Briefing

29 March 2011

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Introduction

Defining cloud services

Stimuli for cloud services

The market opportunity

The cloud services value chain and telco strategic plays

Threats to the cloud services market

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Analysys Mason’s global presence enables us to deliver sustainable business benefits to clients around the world

• Analysys Mason is a trusted adviser on telecoms,

technology and media. We work with our clients,

including operators, regulators and end users, to:

� design winning strategies that deliver

measurable results

� make informed decisions based on market

intelligence and analytical rigour

� develop innovative propositions to gain

competitive advantage

� implement operational solutions to improve

business efficiency

� With over 250 staff in 12 offices, we are respected

worldwide for our exceptional quality of work,

independence and flexibility in responding to client

needs. For 25 years, we have been helping clients

in more than 100 countries to maximise their

opportunities

Assignments completed

Analysys Mason offices

Cambridge • Dubai • Dublin • Edinburgh • London • Madrid • Manchester Milan • New Delhi • Paris • Singapore • Washington DC

Introduction

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Introduction






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Cloud computing combines three concepts to offer a fully hosted solution

Infrastructure as a service

Platform as a service Software as a service


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Cloud computing incorporates different flavours

Private cloudsPublic clouds

Community clouds

Hybrid clouds


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Introduction






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Cloud services are being driven by recessionary factors, changing ICT demands and increasing enterprise interest

Cloud

services

Enterprises

having to

closely adhere

core business

objectives

Source: Analysys Mason


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Introduction






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We forecast that revenue from enterprise cloud services will treble over the next five years


� USD12.1 billion in 2010 growing to

USD35.6 billion in 2015

� SaaS dominated cloud shifts toward

more IaaS over next 5 years

� Channels have unique roles to play

� Telcos (CSPs) need to consider

their market opportunity and how

best to maximise it

Source: Analysys Mason, 2010

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Introduction






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There is a huge mix of requirements for and provision of cloud services

SMEs Mid-market Very large companies

Number of companies

Public-cloud revenue potential (estimate)

Private-cloud revenue potential (estimate)

Mostly SaaS

Mostly IaaS

Email etc. CRM/SFAERP

USD 40–50/user

USD 50–75/user

Specific solutions VirtualisationVirtualisation

BackupBackup CPU

CPU

Google

Amazon

salesforce.com

IBM

CISCO

VMware HP

EMC

Public cloud Hybrid cloud Private cloudOff-premises

Shared serversManaged by provider

On-premisesOwned, dedicated servers

Managed by owner

SMEs Mid-market Very large companies

International deployment

OBSVodafone

Note: revenuepotential

not to scale

Revenuepotential

Company size

Service type

Company size

Cloud services value chain


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So are telcos ready to take advantage of the cloud services chain?

Infrastructure and hosting

Platform services

Application software

Service provision

Network connectivity

and hardware

System integration/consulting

Customer



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Telcos should consider that cloud services is breaking the “traditional” value chain

Pla

tform

s

erv

ice

s

Se

rvic

e

pro

vis

ion

Customer



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Telcos should also consider that customer requirements for telco and cloud services are different

Corporate

customer

Small

business

customer

Healthcare

customer

Telecom services requirements



Corporate

customer

Small

business

customer

Healthcare

customer

Cloud services requirements

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Telcos should also consider that in the “telco world” customers all have different requirements

Corporate

customer

Small

business

customer

Healthcare

customer

The world of telco product provision in the cloud service world



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Telcos also need to consider the provision of generic horizontal …

Generic solutions

PSTN

Unified communications

Connectivity

Processing power

Horizontal /

cross

vertical

products,

services,

solutions

Horizontal A

Horizontal B

Horizontal C

Horizontal D

Vertical packaging

Manu Gov Healthcare Retail Other

PSTN


Connectivity

Processing power

Horizontal /

cross

vertical

products,

services,

solutions

Horizontal A

Horizontal B

Horizontal C

Horizontal D

Vertical A Vertical B Vertical C Vertical D Vertical E

Vertical

products,

services,

solutions

Starting point



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… and bespoke vertical solutions, if they are going to benefit from the changing cloud services value chain

Full vertical offering

End game

Manu

� Inventory

manage-

ment

� Order

manage-

ment

Gov

� Electro-

nic ID

� Biometric

check

Healthcare

� Remote

monitor

� Blood

tracking

Retail

� Mobile stock

replenish-

ment

� CRM

� Mobile SFA

Other

PSTN


Connectivity

Processing power

Horizontal /

cross

vertical

applications

Horizontal A

Horizontal B

Horizontal C

Horizontal D

Vertical A Vertical B Vertical C Vertical D Vertical E

Vertical

applications



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� Evaluate competencies

� Channel strategy

� Technology strategy – including platform

� Customer segment strategy

� Vertical industry strategy

� Internal competencies may need to be enhanced:

� Build internal competencies

� Buy-in – M&A

� Through partners

� Competencies need aggregating as part of a cloud

strategy

What do telcos need to do become a lynchpin in the cloud services value chain?

Customer support competency

requirements

Technology support competency

requirements

• Provisioning, fulfillment

• Maintenance / support

• Integration

• Customisition

• Localisation

• Service aggregation

• Application development

• Application maintenance

• Data centre management

• Hardware development / maintenance

• Service provisioning

• Security

Evaluate, enhance and aggregate

competencies



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Telcos need to think much more carefully about their relationship with partners in the context of the value chain

� Telcos should consider the value of partners in the cloud services value chain

Win-win for telco and telco partners?

� Better, more varied solutions for

customers - single ordering,

provisioning, fulfillment process for

multiple products

� Single point of contact for customers

� Opportunity to provide single sign-on

for multiple services

� Access to new revenue streams

� Maximising efficient use of

infrastructure and support services –

keeping costs down

� …

� Minimised costs and cost of

service deployment

� Increased differentiation of

services

� Increased availability of

horizontal and vertical

applications and services

� Increased provision of bespoke

solutions



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Telco

Telcos must not over-extend themselves and try to offer everything to everyone, or they face a high risk of failure

Pla

tform

serv

ices

Serv

ice

pro

vis

ion

Source: Analysys Mason, company websites

Telcos need to aggregate the cloud competencies of many partners, but

based on customers’ requirements


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Introduction






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Telcos, and the market, must address cloud services market inhibitors

• Security within the cloud is not

mature

• Provide assurance

• Deliver the capability

• Delineate between private

and public cloud

• Regulatory/compliance/governance

issues

• Adapt services

• Buy in advice / work with

experts

• Brokering resources

(internal/external)

• Redeployment to value-

creation projects

• Target finance department /

procurement

• Registered IT partners' reluctance

to sell cloud services instead of

premises-based solutions

• Explore new business models

- hybrid

Select key issues

Treats to cloud services

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Telcos need to better understand their customers, not all applications are equal

� What applications are dynamic / static (changing usage throughout the day)?

� What is the spare capacity in an organisation’s “private” cloud and how can the public cloud

support?

� Are there any constraints preventing applications being migrated?

� Is the organisation ready to adopt a new “charging model”?

� Has the organisation thought about a cloud roadmap? Has it already consolidated its vendor

suppliers?

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Variance in application usage is one determinant for migrating to cloud services

� An application that has no usage variance may not be appropriate to migrate to the public

cloud

� Customers can use spare capacity in a “private” cloud and offload the rest to the public cloud

� For appropriate applications

� This is the most economic option for adopting cloud services

12 AM 8 AM 12 PM 6 PM 11 PM

Week

Weekend

12 AM 8 AM 12 PM 6 PM 11 PM

Off-peak

Week

Usa

ge

= a

pp

usa

ge

Peak Off-peak

MVNO model - excess capacity by time of day

Variance in the cloud word

makes applications more

appropriate for migration

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Thanks for your attention

Gareth Williams

[email protected]

Analysys Mason Limited

Bush House, North West Wing

Aldwych, London WC2B 4PJ, UK

Tel: +44 (0)845 600 5244

Fax: +44 (0)20 7395 9001

www.analysysmason.com

Documents

Presentation for Cloud Services Breakfast Briefing · Presentation for Cloud Services Breakfast Briefing 29 March 2011 2 19510-85 Introduction ... changing ICT demands and increasing