MVNO on Cloud

Attractive sides of cloud are cost-benefits and economy of scale. BSS is easy way to build, add functionalities in the system as BSS is easily configurable. In-premises applications may need dedicated systems but outsourced systems can use cloud easily. Several responses suggested that MVNO should put all the systems that can be implemented on cloud. MVNO should be a light weight organization and cloud can help a lot along with providing cost- benefits and lean business operations. Apart from BSS, Revenue assurance

within OSS and BSS makes an important system to be considered while moving Telco system to the cloud. For example, Qvantel managed 50% cost- cost in IT Infra services. One dedicated Qvantel team manages around 10 customers together. Today we have examples of CRM on cloud - salesforce and Business Process Outsourcing or managed services on cloud - Qvantel.

Large CSPs prefer to be provider of SaaS or provider of cloud for SaaS. They would also like to provide third party services and applications to users as CSPs have channels and infrastructure to support them. In case of in- dependent MVNOs, there are more cases of using SaaS solutions for their processes or internal work since cost-efficient services are important to them. Large CSPs prefer OPEX to CAPEX strategy as they tend to have lower OPEX and invest in CAPEX. They want to have capital spending on infras- tructure because profitability is important. On the other side, small CSPs prefer CAPEX to OPEX transition as they have to mitigate risks of market uncertainty. Therefore, MVNO should make decision to move to the cloud depending on its size.

Question:

How does the cloud make an important factor to be considered in Telco and especially MVNO systems? Which part of the MVNO system can be deployed to the cloud? How the present architecture is affected in this case? (Please refer to table on page no 2 of the questionnaire in Appendix for MVNO systems application mapping on cloud)

Response:

MVNO Operation

MVNO Sys- tems

Comments from Interviewees Taking Or-

ders

Self-service (end-user facing web-portal)

Self-service portal is a light-weight system and based on SaaS architecture. It doesn’t require carrier-grade SLA and some outage is consider- able. Self-service makes a good candidate for cost- beneficial cloud implementation of BSS. However, integration and data access issues can be encoun- tered.

CRM (Cus- tomer Relation- ship Manager)

CRM implementation on cloud is also feasible and viable option. The successful example of sales- force.com shall be taken into consideration. As- suming telecom operators have service points close to users it’s easy to deliver CRM solution to differ- ent location using cloud just like SaaS. However, there are restrictions related to tele-identity info which must be logged into system and shall be available all the time. Customer data security in- tegration is a must. Fraud management system implementation will get difficulties. Data replica- tion policy should be employed while mapping ap- plication to the cloud especially public or hybrid cloud and so before moving data to public or hy- brid cloud, it must be replicated or backup must have been taken already.

OMS (Order Management System)

Ordering is a lightweight system for MVNOs so there is no harm in putting it on the cloud. It will be easier to provide multiple instances of or- der management system at multiple locations (like SaaS) if it’s implemented on cloud. However, net- work connections need to be secure. There are in- tegration issues as well with provisioning system. Customization process gets difficult in case order- ing is implemented on the cloud as this system carries most of the integration points.

Integration Billing & CRM Integrator (En- gine or JMS im- plementation)

If other parts of BSS are implemented on the cloud then integrator should be implemented on cloud. However, there may be performance bottlenecks due to the transactions coming every hour in real time which makes integrator not optimal for cloud. The advantage of moving this system on cloud may not be that huge because number of instances is small in case of MVNO and may not generate enough benefits.

Product Cata- log (Repository of products)

MVNOs have fewer products and so light-weight Product Catalog. It should be deployed on the cloud. Cloud also makes multi tenant implemen- tation possible. However, there are issues like reg- ulatory limits, customization-configuration issues and also if MVNO is large then the cloud imple- mentation gets difficult. B2C products are easy to implement on cloud but B2B products are prob- lematic. Big corporate companies have access to self-service ordering portal where they can define or change the subscription details in bunch. For example, companies like Nokia have web-portals to place orders. These companies change subscrip- tion details all the time and may want to have re- porting. Processing Bills Mediation (pro- cessing call records)

Mediation should generally be on network side or as an integrator between OSS and BSS. It’s possi- ble to deploy mediation on cloud but the deploy- ment is risky and it needs proper integration with MVNO. There are performance and legal issues involved in cloud implementation on mediation. MVNOs get millions of CDRs after some medi- ation from MNO every hour every day. So net- work bandwidth is one of factors deciding the per- formance as we have to transfer CDRs to Cloud. CDRs and call details are very sensitive informa- tion and data security is a very important con- cern here as there is regulatory restrictions related customer data security. There were cases where privacy breached via call details records. A good data encryption policy is required. The data trans- fer to the cloud will be very heavy which may increase the cost of cloud implementation signif- icantly. Comptel is providing mediation solution within one country on cloud. Load balancing is important in case mediation on cloud.

Rating & Invoicing (rat- ing calls and preparing bills)

Rating has also problems similar to Mediation. In- voicing can be deployed on cloud easily. Qvantel is already doing it. Small operators tend to use it. Network bandwidth should be large and hypervi- sors should be fast. There are latency driven issues as well as dependencies on IO and hypervisors. Bill Formatter

(Formatting and printing bills)

There already some cloud implementations of bill formatter in place and some companies are already providing it. For example, StreamServe provides bill formatting and printing as a service. There can be problems as bill formatter involves physical systems such as print devices and proper network- ing is needed in such cases.

Collecting Payments

Account Re- ceivable (receiv- ing payments)

There is not a major problem to implement ac- count receivable on cloud however there are con- cerns regarding credit card information security. Data access and security, especially for financial data, must be of high level for this system. Num- ber of processes are less so account receivable may not have significant advantage if they are imple- mented on the cloud independently.

Collection (due payments, bar- ring, processing payments)

There is not a major problem to implement col- lection on cloud however data security and data access could be an issue and cloud implementation of collection system depends on the service layer implementation. Collection has high amount of processes which gives possibility to implement this system on cloud if other parts of BSS are imple- mented on the cloud. TeliaSonera has it on cloud. TeliaSonera has outsourced it to collection agen- cies and they are running the system on cloud. Internal collection processes, network barring and debt collection agency processes may get affected and need attention.

Inventory Resource Man- agement (man- aging SIM, MSISDN, Data number resources)

In many cases, MVNO rents inventory manage- ment system from MNO. If a service layer is in the cloud then it’s easy to deploy it on cloud as ERP / CRM will already be on cloud making inven- tory a viable candidate for cloud. It would follow same SLA as in case of self-service. However, the counter arguments suggested that the inventory system is close to network elements such as provi- sioning and others which make it difficult to deploy on cloud due to regulatory issues. For MVNO, it might be difficult to implement all systems as cloud may act as generic interface for different el- ements. There is only advantage of cost sharing but it might be the strong reason to proceed with implementation. Prepaid Op- eration Prepaid Card System (real time charging)

The common consent from interviewees was that prepaid system is challenging and not feasible from technology point of view to implement on cloud. The reasons are described as following. Cloud im- plementation of prepaid systems is difficult as it’s a real time charging system and there high avail- ability requirements for such systems. SLAs are critically high and no delays should be there. In- telligent network systems are very close to pre- paid systems and high level integration is needed which is critical. It will be easier with flat IP ar- chitecture in future but right now implementation is way too risky. However, there were some posi- tive responses for cloud implementation of prepaid system which mentioned that online top-ups can be easier with cloud implementation however real time charging setup can be challenging. There are real time charging systems from TeliaSonera for pre and post paid which can be deployed on cloud easily. Country specific clouds are good options to implement prepaid like systems.

Question:

If following parameters are affected while migrating some part or the whole of the MVNO system to the cloud? How?

Response:

Parameter How is it affected? Performance

(Throughput, Latency)

Performance is important and MVNO would like have the same performance level whether or not the systems are implemented on cloud. Throughput and latency are affected on cloud but network bandwidth upgrade could save the situation. Tight data center SLA could improve the performance.

Service Level Agreement (SLA)

On BSS side, SLA requirements are not critical especially for retail or residential customers. SLA may not have critical impact on Billing and CRM systems but the monitoring is needed. For corporate customers, billing SLAs are important and may get affected. Also, internal SLAs between MNO and MVNO may have issues. Cloud service provider should take care of SLA and availability factors. Some responses mentioned that SLA depends on implementation and architecture of IT systems.

Service Delivery Service delivery is not affected much and it may not be visible to customers that the system is implemented on the cloud. In case of self-service portal migration to cloud there is a possibility that service delivery may get affected. However, most of the intervie- wees agreed that sufficient self-service can be organized with the cloud.

Customer Ser- vices

Customer service is important and critical for MVNOs. It gets affected if system implementation on cloud is not proper and this may ruin MVNO business. Costumer services are mostly imple- mented as self-service portals (or CRM) and it highly depends on technology used to build the system. However, some intervie- wees agreed that customer services won’t be affected much. At present many small companies are using CRM on cloud solutions and they are getting good benefits without significant problems. Security (N/w

and Data Secu- rity)

Security of Call data records and customer sensitive data is critical and the most important factor to consider while moving MVNO systems to the cloud. Data security and availability are highly affected. Recent issue with Sony Play Station cloud is one of the examples. Security is easy to implement if systems are in-house but cloud implementation has several challenges.

Carbon Foot- prints

Cloud is more efficient and environment friendly than in-house systems. Carbon footprints are important and they can be re- duced by using cloud. There are concepts of green data centers and green MVNOs coming into existence. Carbon footprint sav- ings also add up to MVNO profits as an opportunity gain. In Netherlands, an MVNO markets their products by saying we do- nate saved costs to NGOs. MVNO can use it as marketing factor however doesn’t make much difference in some markets and age group.

Business Model changes

Business model changes are important since cost-benefits gained using cloud implementation allow MVNOs to drive differentia- tions. Also, MVNOs can concentrate on the core business of sell- ing services and products to the end-users rather than administra- tion of IT systems. For example, MVNOs can reduce MNP period from 5 days to 3 days getting long term benefits of customer satis- faction. It’s possible for MVNO to build a partnership model and provide carrier-grade services to smaller operators. MVNO can drive price differentiations and achieve agility and cutting-edge in the industry while lowering time to market. MVNO can try to operate or differ based on price as OPEX is reduced.

Cross-location Architecture

Cross-location architecture gets affected by centralization using the cloud. It can also be done without cloud. It could be affected but the thing is international MVNOs are not much in operation so it’s a question of importance.

Table 3.3: Results for parameter analysis