Out with the old, in with the new, as they say. The TMF has a new head, Peter Sany, and he’s making statements that sound on target (see this interview in the New IP). Ericsson struggled in revenues for the quarter as they’ve tried to contend with the capex trend in the carrier industry. Transformations abound, which of course gives us lots of things to think about. And apparently a lot of things to fear. “Kainotophobia” is “fear of change” and it’s throwing a kibosh into everyone’s transformation plans.
I’ve worked with the TMF in a lighthearted way for quite a while, and the body is certainly interesting. The essential concept that John Reilly presented half-a-dozen years ago with “NGOSS Contract” was a factor in my own design for CloudNFV and ExperiaSphere and the notion of “Customer-Facing” and “Resource-Facing” services were also ingredients in my model. I’ve cited these TMF inspirations regularly and I put a lot of value on the thinking. It proves to me that the TMF can do good stuff.
What it’s not been good at is what I think the market itself has proven unable to cope with, and that’s “revolution”. Through the last ten years we’ve been seeing a fundamental deterioration of the business model of technology in general and of networking in particular. I’ve cited some statistics on this—operators have seen opex climb from a quarter of TCO toward being two-thirds and heading north. They’ve seen revenue per bit plummet at rates of 50% per year. ARPU in nearly all market sectors is plateauing and in many markets the customer base is saturating. We had all the evidence in the world for these shifts even ten years ago, but everyone ignored them.
It was seven or eight years ago that the issues really started to come to the fore. Almost immediately operators started grousing that vendors were not supporting their transformation goals. By 2008 every single operator in my survey was rating vendor support of transformation as “unsatisfactory”. At about that same time, the TMF was absorbing another body that had been effectively focusing vendor and operator efforts to develop a different model of service operations. The initiative (the IPsphere Forum) died in the TMF.
What was behind both vendor intransigence and TMF glaciation was trying to take an evolutionary view of revolution. If you want to transform a technology or an industry you have to start with what you’re trying to get to, not where you are already. If we want to revolutionize network infrastructure, paint a picture of what the ideal would look like. Revolutions in opex have to start by defining the perfect system for automated operations. From the goal, we can then follow tendrils of possibilities back toward the present and order approaches by cost and risk to pick one.
The TMF is a political body and an organism focused largely on its own survival, which is what vendors are as well. They could have answered every single point that their new leader raised in that interview I cited as far back as 2008 and could have decisively addressed the points in 2013. They didn’t do that not because they weren’t exposed to the right approach—they already had fielded the cornerstone strategies needed—but because they got tangled up in politics and weak leadership and shallow thinking.
Vendors are similarly tangled. Do the big-name network vendors seriously think that operators would invest growing sums in infrastructure that was yielding diminishing ROI? These are the guys who were cutting their own costs to make the Street happy. If you want somebody to increase the “I” you have to increase the “R”. As important as cost management is, it’s nothing more than a means of refining a positive revenue model. Only benefit gains can ultimately fund profit growth and infrastructure investment. Yet vendors have focused not on fixing their market problem but capitalizing on the symptoms. No products to support transformation? Ericsson’s answer was to focus on integration and professional services. Well, there is no way that one-off solutions to ROI problems is going to cut it as far as the industry is concerned, Mr. Ericsson. Products systematize solutions, lower investment overall, and improve profits. Band-Aids simply blot up the blood.
We know today that services in the future will be highly personalized. That has to be true because the consumer market is fad-driven and because mobile broadband has linked technology to moment-by-moment living and not to life planning. We know that this means “agility” but what the heck does “agility” mean in a tangible way? It means compositional architectures so it should start with very effective modeling. Who talks about their service models in SDN or NFV? It means event-driven processes but nobody talks about service states and state/event tables. It means resource fabrics and process fabrics that combine to form the cloud, “information fields” created by things like IoT. Where are the products for this?
If you read the stories of SDN and NFV and the cloud, you’d think we have already met and defeated the future. The cloud is so entrenched in the media culture that people who are talking about private IT think that has to mean “private cloud” because after all the cloud has won. Won, if winning is securing 2.4% of global IT spending. SDN is transforming every company and every network and yet the actual processing power expended on SDN Controllers today is less than that of a single graphics arts firm. NFV is on every operators’ lips but canny CFOs say that they can’t prove the business case with current activities.
The TMF can solve its problems in six months by simply starting at the top and defining what operations for the new age should look like, forgetting all the old-timers that would offend and all the conservative thinkers whose coffee breaks would be ruined. Ericsson could buy some critical startups and assemble a complete SDN and NFV story that, when supplemented by professional services, would make them winners even over Huawei. Every piece of the SDN and NFV pie that’s needed to meet current and future needs is out there already, waiting to be exploited. Every design and plan needed for transformed operations and “service agility” has already been proposed by somebody, often by multiple people.
Does Ericsson want to fall forever behind? Huawei is increasing revenues by 20% annually while competitors struggle just to stay even. Does this sound like you’re winning the game you insist on playing, Dear Vendors? The TMF has spent more time talking about its ZOOM transformation than would have been required to do a truly effective demonstration using running software. Does this sound like “focusing on demonstrating progress and then driving consensus, not the other way around” as new TMF president Peter Sany said in the interview?
We are in the industry that has been responsible for more change than any other in modern times. Why have we allowed ourselves to become so fearful of change now? We should fear the status quo instead, because it’s not doing well for most of us.