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March 2009




IBM SPDE – Enabling Service Providers to
                          Work Smarter
                          An Executive Brief
                            Sponsored by IBM
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                            A Stratecast Executive Whitepaper




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IBM SPDE – Enabling Service Providers    © Stratecast (a Division of Frost & Sullivan), 2009           Page 2
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                       A Stratecast Executive Whitepaper


IBM SPDE – Enabling Service Providers to Work Smarter


Table of Contents
Executive Summary ............................................................................................ 5
The Converging Communications Marketplace ................................................ 6
   Industry Convergence ...........................................................................................................6
   New Generation Service Offerings – Lifestyle Services ........................................................6
   Addressing CSP Business Change ........................................................................................7
IBM’s Strategy for Communications Industry Evolution................................... 8
   IBM’s Service Provider Delivery Environment (SPDE) .......................................................8
   SPDE 3.0 – Service Delivery AND Business Process Support ........................................... 10
Addressing Key Industry Imperatives................................................................12
   Accelerate Service Innovation & Delivery........................................................................... 12
   Evolve to Optimized Operations......................................................................................... 13
   Differentiate the Customer Experience .............................................................................. 15
The Last Word ...................................................................................................17




IBM SPDE – Enabling Service Providers              © Stratecast (a Division of Frost & Sullivan), 2009                      Page 3
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                  A Stratecast Executive Whitepaper


IBM SPDE – Enabling Service Providers to Work Smarter


List of Figures
Figure 1 – The Market Drivers of Change.................................................................................6
Figure 2 - Business Transformation is More Than a Shift in Business Strategy......................8
Figure 3 - IBM SPDE Framework Evolution (2001 to Today) ............................................... 10
Figure 4 – IBM Service Provider Delivery Environment 3.0................................................... 11
Figure 5 – Expands Source of Innovation and Shortens Development Cycle........................ 12
Figure 6 – Focus on Business Optimization is Accelerating.................................................. 14
Figure 7 - Optimize Service Quality and Focus on Customer Value...................................... 15




IBM SPDE – Enabling Service Providers          © Stratecast (a Division of Frost & Sullivan), 2009                Page 4
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


IBM SPDE – Enabling Service Providers to Work Smarter
Executive Summary
Those communications providers that don’t own their own access networks often understand well
how to effectively market to business customers and consumers, and because they are not endowed
with “incumbent” status, are the very organizations that are changing the Communications Service
Provider (CSP) competitive landscape. Smartphone devices from various manufacturers are
presently associated with several network-based operators around the world, which combine
2.5G/3G network connectivity with internet-based content and applications. However, this strategy
is likely to change in the near future as consumer electronics and mobile voice technology are rapidly
consolidating. Voice communications as an IP service—VoIP via a broadband connection—is just
one of many applications enabled from a single device by customers for a variety of business and
personal needs.
For CSPs to “stay up with technology” huge demand—at an increasingly faster pace—is now placed
on internal IT resources to better enable today’s installed Operations Support Systems (OSS) and
Business Support Systems (BSS). Along with systems change is a heavy requirement to update and
modify the business processes tied to defining new services, providing customers with choice in
service options, provisioning each service, billing for service usage and of course assuring each
service works every time the customer expects it to work. Tied to these requirements are the
increasing levels of network flexibility offered through the latest advances in technology
infrastructure, which are driving service availability to any time, anywhere, on any device. In
addition, there is a growing awareness of network, service, and customer data to be collected,
processed and harvested for better understanding of customer needs and to more effectively match
those needs with business capability.
This report discusses the key business drivers moving the communications industry toward
“customer lifestyle services.” Such services require a variety of capabilities CSPs must address
regarding both network connectivity and content interaction. The report points out why today’s CSP
installed systems and business processes must be transformed to more effectively meet the changing
needs of the converging communications industry. It provides a brief history concerning IBM’s
Service Provider Delivery Environment (SPDE) strategy. The bulk of this report summarizes the
latest capabilities IBM’s SPDE 3.0 brings to bear and highlights a number of case examples
successfully addressing the transformation challenges CSPs must deal with today and in the near-
term future.




IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009           Page 5
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                              A Stratecast Executive Whitepaper



The Converging Communications Marketplace
Industry Convergence
Today’s market landscape is much more than simply the convergence of fixed line and mobile
technologies. The telecommunications industry is converging with the means of other markets
including those from IT (e.g. data storage, security functions, and applications), media (print and
broadcast news), entertainment (gaming, video, broadcasting), and advertising. As shown in Figure
1 below, convergence of these multiple industries is defining business drivers that are producing new
capabilities for better meeting today’s customer “lifestyle” needs. For the CSP community, such
change is driving a new level of “real time” Operations Support Systems (OSS) and Business
Support Systems (BSS) requirements, which in turn are placing an overwhelming demand on
Information Technology (IT) resources to change, enhance and/or replace existing OSS/BSS.
Figure 1 – The Market Drivers of Change
                   Converging Marketplace




                                                                                                     Key Business Drivers

                                                                                                                   Consumer Electronics
                                                                                               Device Evolution            +
                                                                                                                     Communications




                                                                                                                    Network, IT and
                                                                                               Infrastructure        Mobile, Fixed




                                                                                               CSP Business Maturation

                                                                                                                            Access
                                                                                                                         Data Retention
                                                                                               Regulatory Change        Competitive Play
                                                                                                                          Corp Comply
       New Business Models Through Customer Lifestyle Services
 Examples of Lifestyle Service Enablers:
    Network services (VM, Email, voice, SMS, MMS, VoIP, IPVPN, IPTV, telepresence, …)
    User definable controls based on transaction volumes, relationships and financial limits
    Business applications (office, sales, medical, supply chain, …)
    Personal lifestyle preferences (fitness, geriatric, pets, social)
    Content (media and/or entertainment)
    Advertising sponsorship of voice minutes and text message for consumer opinion
    Several others …


                                                                                                                     Source: Stratecast

New Generation Service Offerings – Lifestyle Services
Stratecast defines customer lifestyle services as any combination of network capabilities, content,
and user device features for addressing a variety of lifestyle preferences defined by business, social or
personal interest categories. These complex offerings can involve a number of capabilities alone or
together including: multiple network access methods (broadband, mobile, fixed line); network
services (email, VM, voice, and IP-X e.g. IP-VPN, IP-PBX, IPTV); IT functions (data storage,
business applications, single sign-on security); media and/or interactive content. Examples of such
services, which are deployed by some organizations already, include the following:


IBM SPDE – Enabling Service Providers                   © Stratecast (a Division of Frost & Sullivan), 2009                          Page 6
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


    •   Interactive Multi-flow Messaging – The best example of multi-flow messaging services
        comes from the entertainment sector, and in particular, gaming, with its real-time,
        coordinated multi-flow needs (e.g. game logic flow, video flow, communication flow via
        voice or IM, and a player presence flow). Other multi-flow services for both business and
        consumers are also possible including distance learning, social networking, telepresence
        meetings, high-technology collaborative research, transportation/logistics management, and
        marketing/sales coordination.
    •   Business Application Solutions – Business solutions can take on many forms involving
        packaged or individualized groupings of network/content functions such as email, office
        applications, data storage, security, VoIP, specialized applications particular to an industry
        vertical, and a variety of push or pull content sources. Some operators even include the
        necessary user device tools based on Software as a Service (SaaS) models.
    •   Telemedicine – Telemedicine services include several areas as the healthcare industry looks
        for ways to cut costs including: life function monitoring (pacemaker/defibrillator heart
        monitoring, high risk fetal/neonatal monitoring, and “at-home” geriatric monitoring) via a
        wireless or fixed line connection tied to “on-tap” analysis applications or specialized
        customer care services; clinical records analysis and correlation between healthcare facilities
        and/or insurance companies via common data storage and secure access; medical imaging
        data storage and retrieval through remote secure access; and for patients with chronic
        medical conditions, records coordination between same provider clinics and multiple
        healthcare facilities via patient-authorized secure assess.
    •   Machine-to-Machine Interaction – Remote monitoring and assembly of raw data to
        usable “information blocks” that are then passed to other “added value” applications.
        Examples include remote device dispenser monitoring integrated to a supply chain system or
        aggregation of remote sensor fluid flows with critical manufacturing environmental
        definitions for optimizing service delivery performance.
    •   Health and Fitness – Bringing together presence and availability functions to chart jogging
        progress via a GPS-enabled mobile device. The long-term opportunity may even allow a
        mobile device to possess health monitoring capabilities (e.g. pulse, blood pressure, oxygen
        saturation, and respiration rate) based on a user-defined set of conditions combined with
        individual presence (location, time from start, pace, and time-to-completion).
Processes and systems to support these new services, and in many cases engage as part of the
service, are redefining the way OSS/BSS are used globally.

Addressing CSP Business Change
Based on network technology and personal electronics evolution, business customers and
consumers now have choice when addressing a growing list of needs—in network access, in service
definition and manageability, in interacting with media and entertainment content, and even in how
services are subscribed and paid for. Several of these choices now involve some type of real-time
manageability features. The thrust of today’s needed change in business approach, as shown in
Figure 2 below, rests in realignment of processes, systems, and the way business is conducted. This
is essential to better address a variety of the multiple issues involving offers of lifestyle services.
Many of the large business solution suppliers have recognized this shift and are now much more
focused on end-to-end business improvements, while others are still trying to get it right. For



IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009           Page 7
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                                              A Stratecast Executive Whitepaper


example, IBM continues working with several different CSPs around the world to redefine the way
they do business. This is accomplished by emphasizing new ways to address subscriber growth
while at the same time making improvements to processes and systems to reduce operating costs,
improve overall end-user satisfaction, deliver more appealing lifestyle services as a point of
differentiation and to successfully augment declining revenues from traditional services.
Figure 2 - Business Transformation is More Than a Shift in Business Strategy
         Key Business Drivers

                        Consumer Electronics
    Device Evolution            +
                          Communications




    Infrastructure       Network, IT and
                          Mobile, Fixed
                                                                                                       CSP Business Model
                                                                                Processes
                                                CSP Business Strategy
    CSP Business Maturation
                                 Access
                              Data Retention
                                                                                  Start                                       Finish
    Regulatory Change        Competitive Play
                               Corp Comply



                                                                                People

    Business Transformation is a
                                                                                Systems
    CSP’s reaction to new and/or
    changing business drivers in
    realigning strategy, processes,
    systems and the way people
    conduct business to best                                                                           Network                  3rd Party
    address customer expectations                                                                   Infrastructure             Partners &
                                                                                                                                Suppliers
    and to provide the greatest
    shareholder value.

                                                                                                                                       Source: Stratecast
                                                                                                                        1
For CSPs that have taken the first steps in the transformation journey for their business
processes and systems to address the new generation customer lifestyle services, the future
looks very promising. For those considering what to do next there is time. However,
holding back to wait out the current storm of economic uncertainty is not a safe harbor. As
technology evolution continues, CSPs still deciding on a “best strategy” for their business
needs should look closely at partnering with a supplier possessing proven transformation
credentials. Choosing an unproven path, given today’s economic uncertainties, substantially
increases the risk of major disappointment and serious business concern in the months to
come.

IBM’s Strategy for Communications Industry Evolution
IBM’s Service Provider Delivery Environment (SPDE)
In early 2001, IBM identified the telecommunications market as one of its strategic focus areas, with
specific attention to the top 25 global CSPs. To serve this segment, the company introduced the

1 Business transformation within the communications industry is a journey and not a destination. Stratecast defines it is
as a CSP’s reaction to some or all of today’s business drivers (technology evolution at both the network and user device
level, changing regulation, and a maturing of the CSP marketplace) in realigning strategy, processes, systems and the way
people conduct business to best meet the needs of technology evolution, changing customer expectations, and in
providing the greatest shareholder value.



IBM SPDE – Enabling Service Providers                                   © Stratecast (a Division of Frost & Sullivan), 2009                      Page 8
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                       A Stratecast Executive Whitepaper


Service Provider Delivery Environment (SPDE), which was defined as IBM’s current go-to-market
strategy for the telecommunications sector. More specifically, a Stratecast report assessing IBM’s
foray into the telecom sector stated: “SPDE includes an IBM-supplied reference architecture
for application integration and business process management, professional services,
demonstrated integration capability through the company’s Network Integration Labs
(NIL), pre-defined process templates, an extensible data platform, and partner programs.” 2
IBM officially launched SPDE in February 2002, defining it as a “… comprehensive delivery and
management architecture for content and applications through multiple transport environments
without significant modification. It is based on open IT and telecom standards and is designed to
take advantage of telco industry standards such as Parlay and OMA (Open Mobile Architecture) as
they emerge, as well as key emerging Internet standards such as UDDI, WSDL, and SOAP that are
key to delivering Web Services.” 3
Shown in Figure 3 below, the 2001 SPDE framework was focused on supporting mobile data
services in a way that was standards-based in a soon-to-be-proven cost effective manner. It would
also allow CSPs to introduce traditional network services combined with application and content
capabilities. From these early beginnings SPDE was clearly designed to be more than a technical
architecture, as consideration for the end-to-end business needs tied to addressing the evolving new
generation of “network connectivity plus content” services was starting to take shape.
Keeping pace with technology evolution, SPDE 2.0 was launched in early 2006. In addition to what
SPDE 2001 offered, the new version included Telecom Operations Content Packs based on
industry standards from the TM Forum 4 , an advancement of Web Services functions in the form of
Service Oriented Architecture (SOA) standards, and “… extensions to accommodate the specific
requirements of the 3GPP 5 IMS architecture. The solution comprises two main environments --
Service Execution and Service Creation.” 6 Specifics about each of these extensions, with reference
to a major implementation project for Swisscom at the time, included the following:
     •    Service Creation Environment – The Service Creation environment was defined as a “…
          model-driven and integrated set of tools for creating, deploying and reusing services and
          software components. The environment includes a well-defined and automated process




2 Stratecast Report “OSSCS 03-04 An Assessment of IBM’s Telecom Strategy: Service Provider Delivery Environment (SPDE),”

August 2002.
3
 IBM Press Release “IBM Offers 'Speedy' Introduction of Next-Generation Wireless and Telecom Services – New Framework Cuts
Development Time from Months to Weeks,” February 19, 2002.
4 IBM’s Telecom Operations Content Packs incorporate standards definitions based on the TM Forum’s Next

Generation OSS (NGOSS) enhanced Telecom Operations Map (eTOM), NGOSS Telecom Applications Map (TAM),
NGOSS Shared Information Data (SID) model, NGOSS OSS through Java (OSS/J) interface definitions, and the
NGOSS Multi-Technology Operations Systems Interface (MTOSI) for messaging schemas.
5 The 3rd Generation Partnership Project (3GPP) is a collaboration effort between groups of telecommunications
associations, to make a globally applicable third generation (3G) mobile phone system specification.
6
 IBM Press Release “Telecommunications Operators Can Reduce Time-to-Market With New Platform – Swisscom Mobile and IBM
Have Demonstrated the Capability to More Efficiently and Rapidly Create Telecom Services and Incorporate Third-Party Applications,”
February 13, 2006.



IBM SPDE – Enabling Service Providers              © Stratecast (a Division of Frost & Sullivan), 2009                     Page 9
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                                                                                                                            A Stratecast Executive Whitepaper


                      offering guidance across the service creation lifecycle. The domain is realized using an
                      integrated set of technology including IBM's WebSphere and Rational software ….” 7
       •              Service Execution Environment – In an early deployment at Swisscom, the Service
                      Execution environment utilized “… Nortel's IMS control plane located at IBM's Montpellier
                      facility and which is connected to Swisscom Mobile's network via IP VPN circuits.” 8
Figure 3 - IBM SPDE Framework Evolution (2001 to Today)
                                                                                                                                                                                                             2009 – SPDE 3.0
                                                                                                                                                                             Service Oriented Architecture
                                                                                                                                                                               3rd Party Domain

                                                                                                                                                                                           Service Execution Domain                          Support Systems Domain
                                                                                                                                                                                                                         3rd Party Access
                                                                                                                                                                                                                                     Process Choreographies
                                                                                                                                                                                            Core Runtime Functions                           Service    Core OSS & BSS Functions
                                                                                                                                                                                                                                             Runtime
                                                                                                                                                                                                                                             Support              Billing
                                                                                                                                                                                                              Content & Media                                 Assuranc
                                                                                                                                                                               Ideas to                     Web 2.0                                                e
                                                                                                                                                                                                                                                           Fulfillmen
                                                                                                                                                                              Deployment                                  Service
                                                                                                                                                                                              Convergent Services     Applications                              t
                                                                                                                                                                                                                                                          Care

                                                                                                                                                                                            User Interaction
                                                                                                                                                                                             Portal &
                                                                                                                                                                                                                           Personalization             Information Management
                                                                                                                                                   2006 – SPDE 2.0                           Presentation


                                                                                                                                                                                                Network Abstraction Layer                              Network Access
                                                                                                                                                                                           Network Delivery Domain

                                                                                                                                                                                           Device Domain User interaction                                     Device Support

                                                                                                                                                                                                                                                                 Business Intelligence
                                                                                                                                                                                                                                                                               Security




            2001 – Framework
               Introduction
                                                 Ap p lica tio n D e liv ery E n viron m e nt
            U sers      D evices    Netw ork                   S ervice s Bro kerage                              U ser S ervices
                                    Delivery                                                            Prov is io ne d As s e ts (inte rnal)
                                     M obile
                                                                              P re s e nta tio n            B us ine s s App lica tions
                                                                                 S ervic e s
                                     B roa d -               N e tw o rk                                       Lo c atio n S e rvic e s
                                      B a nd                 S e rvic e s
                                                                                                                       othe r
                                     C ore IP
                                                                                      B2B                          Co m m e rce
                                                                                   G a te w a y
                                      PST N
                                                                                                                   M e s sa g ing
                                                                      Subs c rip tion
                                      o the r                           S e rvic e s                         C onne c te d (ex te rnal)
                                                                                                          C onte nt a nd A pplic a tio ns




                 In te g ra tio n          O p era tions Sup port &                     S ervice s                                  Fina ncial
                                              Re a dine ss (C RM )                    M an agem ent                                 S ervices
                      Hu b

                                     B usin ess P ro cesses and W o rk flow                                                          Ex te rna l


                                            F ulfillm e nt         As s ura nc e           B illing
                        other                Se rv ice s            S e rvic e s          Se rvic e s




                                                                                                                                                                                                                                                                         Source: IBM

SPDE 3.0 – Service Delivery AND Business Process Support
The SPDE 3.0 Framework, shown in Figure 4 below, was announced in February 2009 9 . Beyond
what SPDE 2.0 provided, the current version includes capabilities not typically identified with the
technology architecture the industry today has come to call a Service Delivery Platform (SDP).
While no specific industry standard has been established for an SDP, the basic expectations from
any such services framework involves: the ability for a CSP to create new services from various
network-based building blocks; implement these services and control their behavior when
operationalized within a public or private communications network; and interface through standard
protocols with existing network equipment.




7   Ibid.
8   Ibid.
9 IBM Press Release “IBM Unveils Next Generation Service Delivery Framework to Help Communications Service Providers Thrive in
an Interconnected World,” February 11, 2009.



IBM SPDE – Enabling Service Providers                                                                                                                    © Stratecast (a Division of Frost & Sullivan), 2009                                                                   Page 10
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                         A Stratecast Executive Whitepaper


Figure 4 – IBM Service Provider Delivery Environment 3.0
  Service Oriented Architecture

    3rd Party Domain

                   Service Execution Domain                                 Support Systems Domain

                                                      3rd Party Access
                                                              Process Choreographies
     Service
     Creation        Core Runtime Functions                                 Service     Core OSS & BSS Functions
     Domain                                                                 Runtime                Billing
                                        Content & Media                     Support
                                                                                               Assurance
     Ideas to                        Web 2.0
    Deployment                                      Service                                Fulfillment
                       Convergent Services     Applications                               Care

                    User Interaction
                      Portal &
                                                          Personalization              Information Management
                      Presentation


                            Network Abstraction Layer                                   Network Access
                  Network Delivery Domain

                  Device Domain User interaction                                                  Device Support

                                                                                                           Business Intelligence
                                                                                                                         Security

                                                                                                                       Source: IBM
What makes SPDE 3.0 more than just a technology architecture is its focus on the end-to-end
solution support picture pertaining to the business issues around today’s customer-focused complex
lifestyle services. Some of these “operational and management functions”, beyond the actual service
delivery capabilities previously mentioned include:
    •   An ideation environment that can evolve service concepts to service implementation realities
    •   Advances in SOA-based business processes critical for immediate support of new service
        options
    •   Media integration functions in the form of composite services for enabling CSPs to blend
        entertainment, advertising and other forms of digital media into complex customer services
        that can be offered across a variety of networks and devices
    •   Service runtime support for core OSS/BSS functions including customer care, fulfillment,
        billing and assurance
    •   Expansion into the service management domain to help automate and secure a dynamic
        infrastructure of applications, systems and networks
    •   Business intelligence capabilities for analyzing consumer usage behaviors and trends as a
        means for helping CSPs improve the success of their service portfolio, better understand
        customer preferences, and improve overall network performance
    •   Advanced security functions.
IBM has approached the business transformation challenge, through SPDE 3.0, with numerous
customers emphasizing a variety of focal points. Some of these are approaching transformation
from the service innovation and exposure perspective. Others are going about it from an


IBM SPDE – Enabling Service Providers              © Stratecast (a Division of Frost & Sullivan), 2009                     Page 11
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                  A Stratecast Executive Whitepaper


information management, service assurance and even multi-systems integration point of view. Since
no two CSP business strategies are alike, to better explain how SPDE 3.0 addresses a number of
needs within the CSP marketplace today, the balance of this report offers several customer case
examples tied to the following critical business functions:
•   Accelerating the rapid definition and launch of new services
•   Reducing the cost of operations and optimizing understanding of operational information
•   Differentiating the end-user customer experience.

Addressing Key Industry Imperatives
Accelerate Service Innovation & Delivery
    •   The SPDE 3.0 service creation and execution domains are a major point of emphasis for
        CSPs looking to expand their service footprint through offerings with appeal to the
        customer lifestyle needs previously described. As shown in Figure 5 below, the Service
        Innovation, Design and Creation process is set up to enhance the “idea-to-implementation”
        portion of a new service launch.
Figure 5 – Expands Source of Innovation and Shortens Development Cycle


                                                                    Partners
                                   Service                                 3rd Party Access to
                                 Innovation                                 exposed enablers

                                          3rd Party Domain

                                                        3rd Party Access
                                                     Service Execution Domain

                                                      Service                   Service
                                         Service      Applications Content      Runtime
                                                                    & Media
                                         Creation                               Support
                            Service                           Web 2.0
                                         Domain
                           Design and
                            Creation                   Convergent
                                                        Services     Service
                                                                    Execution
                                                    Network Abstraction Layer

                                        Network Delivery Domain

                                                                              Service Exposure of
                                                                               Network Enablers


                                               Subscribers




                                                                                                        Source: IBM
Components of SPDE 3.0 supporting this need include:
    •   Service Innovation – Uses IBM’s array of initiatives with Web 2.0 for a dynamic and
        connected “ideation” process.




IBM SPDE – Enabling Service Providers         © Stratecast (a Division of Frost & Sullivan), 2009          Page 12
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


    •   Service Design and Creation – Incorporates IBM’s Rational service creation capabilities
        for building IP-based converged communications applications. This involves a suite of tools
        tied to service concept & definition, service design, service development, service testing, and
        service deployment.
    •   Service Execution – IBM’s WebSphere execution platform provides a common SOA-
        based approach for composite service applications, leveraging presence, voice, media and IT
        enablers.
    •   Service Exposure – Industry-standard Web service exposure of telecom network
        capabilities and connections into the Web 2.0 world.
Implementation examples include the following:
    •   Improving Service Innovation and Time-to-Market – A large Asian CSP implemented
        IBM’s Idea Factory to create a collaboration environment for product managers, partners,
        and end-users. Idea Factory is part of the IBM Service Innovation, Design and Creation
        Domain. In this example, a portal allows product managers to set up a trial using templates
        and tools to on-board users, conduct surveys, prompt for feedback, collect all responses, and
        analyze results. During a 9-month period, this CSP was able to identify 27 new services
        based on 576 defined ideas. Without Idea Factory, only 3 new services from 259 ideas were
        previously established in approximately the same time period. The first suggestion was
        entered to the system only 10 minutes after initial implementation, which showed the level
        of interest in this advanced way of bringing a number of thought/action processes together.
    •   User Assisted Service Definition – A large Asian operator sponsored a contest to develop
        next generation applications. Controlled access to network information from services such
        as SMS, call control, presence and IMS to internal employees and external users was
        provided as Web services. By offering a secured environment this operator successfully
        demonstrated it can tap into the creativity and innovation of third party developers and Web
        2.0 clients. Going forward, this CSP views such practices as essential in its quest to rapidly
        respond to new market opportunities, to explore new potential revenue streams, and to
        extend its market reach with finer grain targeting of select service offerings.

Evolve to Optimized Operations
The SPDE 3.0 service runtime support and information management domains allow CSPs to
capitalize on dynamic process integration and information management capabilities. It involves
SOA-based integration of various business processes using IBM’s Telecom Operations Content
Pack. This consists of approximately 150 pre-built business processes addressing the assurance,
fulfillment and billing functions using the TMF NGOSS definitions including eTOM, TAM, SID,
OSS/J and MTOSI. The content pack assets are then pre-certified, tested, and supported on IBM’s
middleware layer.
Beyond process integration, the SPDE 3.0 approach also paints a course for CSPs to capitalize on
customer and product/service information using master data management, information integration,
and business intelligence functions to optimize their businesses. This is a journey as shown in
Figure 6 below. Creating an “Information Agenda” now is critical for CSPs to leverage their
information (customer, product, service, and network) as a strategic asset in establishing and
sustaining competitive advantage.



IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009         Page 13
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


Figure 6 – Focus on Business Optimization is Accelerating




                                                                                                 Source: IBM
Business optimization examples include the following:
    •   Delivering Innovative Services with Greater Speed and Quality – Since implementing
        SPDE 3.0 a large European mobile operator has reduced the time required to integrate and
        deliver new services to its target market by 64%. By using a common platform and service
        bus, this CSP also expects a 19% reduction in the total cost of ownership over five years.
        This cost reduction includes several points: software license and maintenance, hardware, new
        service startup costs, implementation, business model change, and Enterprise Service Bus
        (ESB) maintenance.
    •   Integrating New Services with Existing OSS/BSS – Reusable integration templates
        (IBM Telecom Operations Content Pack) applied across services and channels reduces
        order-to-cash delays, reduces fall out, and improves customer satisfaction. An Asian mobile
        CSP used a portion of SPDE 3.0 to construct a flexible service-oriented architecture. Using
        that foundation, this CSP was able to broker approximately 5,000 messages per day between
        previously siloed OSS/BSS. The solution cut average problem resolution time from two
        days to less than one hour, helping to boost customer satisfaction levels. An Eastern
        European CSP also uses a SPDE 3.0 configuration to accelerate provisioning time for new
        subscriber services from several days to several minutes using existing OSS/BSS.
    •   Unlocking the business Value of Information to Create Competitive Advantage – By
        creating and maintaining an accurate view of the customer, other business units can utilize
        the data to determine offers and discounts or insert advertising. Meshing customer, service,
        and network information enhances the ability to define, deliver, and support new revenue
        generating services. A South American CSP implemented a data warehouse solution based
        on IBM DB2 Warehouse. The resultant data warehouse contains more than five years of



IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009         Page 14
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


        information and supports most of the CSP’s key business processes, including marketing,
        financial, commercial and network systems. The system uses advanced data mining
        techniques to identify the most profitable customers and predict payment delays. Since the
        data warehouse has been in place, this CSP reports it has avoided revenue losses of
        approximately $4 million per month.

Differentiate the Customer Experience
The SPDE 3.0 framework is designed to improve the customer experience by offering multiple
capabilities and functions in service management and security. As shown in Figure 7 below, IBM’s
SPDE 3.0 Service Management offering can address a number of different functions.
Figure 7 - Optimize Service Quality and Focus on Customer Value




                                                                                                 Source: IBM
The three aspects of this strategy rest with visibility, control and automation as defined by the
following:
    •   Visibility for Improving Service Quality and Customer Retention – SPDE 3.0 service
        management solution provides: end-to-end visibility of services across multiple network and
        IT technology domains; delivers a visual link between customers, infrastructure and SLA
        definitions; provides instantaneous notification of any SLA violations; monitors for service
        quality through Key Performance Indicators (KPI) and Key Quality Indicators (KQI); and
        can pinpoint service-affecting events and the impact such events will have on service
        availability and quality.
    •   Control to Maximize Return on Assets and Reduce Risk – SPDE 3.0 service
        management solution offers: monitoring of all network/IT assets (IT data center operations,
        mobile base station utilization and network node capacity) for maximizing usage and



IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009         Page 15
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                           A Stratecast Executive Whitepaper


        identifying unused capacity; improvements in labor efficiency through combined helpdesk
        support for network, IT and even customer needs; improved governance and compliance
        through single sign-on and authorization by network or operations asset type/function; and
        manage the explosive demand for data storage tied to content-based services.
    •   Automate and Streamline Management Processes to Accelerate Growth – SPDE 3.0
        service management solution supports a number of business needs including: a single view
        of events and management details from both new and existing service assurance tools to
        reduce complexity and deliver a more effective means for isolating problems; tracks more
        than 100 million events per day; correlates this data and reports on top-end issues for
        operator resolution; and monitors end-to-end business processes to identify issues and
        business challenges.
Industry progress within the service management and security domain, especially with regard to
differentiating the customer experience, include the following CSP case examples:
    •   Preventing and Responding to Security Threats – With more services in use by more
        customers, the risk of compromise is significant. SDPE 3.0 provides the ability to secure
        applications, services, and service access while managing users and service usage changes.
        This includes federated identification and secure portal integration. For example, by using
        the IBM DataPower Appliance as the front end of a Web Services Gateway, a North
        American operator was able to expose services to subscribers and partners while also
        ensuring security. The IBM DataPower appliance provides authentication, authorization,
        and audit functions in addition to content-based routing utilizing digital signatures and
        encryption features, validation of schemas, and protection against malicious attacks. The
        deployment is clustered in the CSP’s wireless network.
    •   Improving Quality of Service and Reduce Customer Churn – Real-time end-to-end
        network and services visibility allows CSPs to maximize utilization of existing assets while
        ensuring security and survivability. As a means for proactively delivering high quality voice
        and data services, a European mobile CSP presently utilizes IBM Tivoli Netcool to monitor
        business and consumer services across its mobile infrastructure. The ability to manage its
        network in real time and anticipate problems is a key differentiator for this operator in
        reducing the level of customer churn. Automated event correlation and analysis has reduced
        the number of daily events from 20,000 to 4,000 and subsequently reduced the resources
        required to manage the network by a significant level. Through this approach the NOC staff
        gains a better understanding of the impacts of service degradation, resulting in executing
        trouble resolution processes aimed at addressing critical customer-affecting problems first.




IBM SPDE – Enabling Service Providers   © Stratecast (a Division of Frost & Sullivan), 2009         Page 16
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                                    A Stratecast Executive Whitepaper




                                                    Stratecast
                                                  The Last Word
Network technology advances and mobile user device evolution have enabled a new generation of
complex customer services making up today’s “real time” world. These services compel CSPs to
transform many of their business processes to recognize systems functions—within customer care,
billing and provisioning especially—as a working part of each service. They are also ushering in a
new generation of business models that look to deal with customer lifestyle needs first, then on how
these needs impact the content, service, application, and network layers. Most importantly,
customer lifestyle services are placing requirements on current business processes and installed
systems they were never designed to address, especially regarding capabilities tied to real time
verification, validation and notification.
From managing evolving requirements to accelerating and delivering change, a collaborative
customer data and product/services lifecycle management platform such as IBM’s SPDE, creates
consistency and continuity of software processes, data, and delivery. Stratecast believes business
transformation requires not only flexible systems but also an automated means for adjusting
business processes and the work tasks that will be completed by human resources. It
further requires dedication to better response time from applications, more effective
generation and notification of customer usage charges, rapid assimilation of service
enablers to meet unique customer needs and near real-time settlement with partners to
name just a few. A CSP’s OSS/BSS environment can no longer provide passive support; it
must be part of the new wave of customer service offerings. Beyond this, harvesting the
richness of network, product, service and customer data to optimize business performance
can no longer be ignored if competitive positioning and new revenue generation are now
major imperatives for long-term success.
SPDE 3.0 has proven it is possible to transform the way CSPs conduct business to a new tightly
integrated approach involving network technology, OSS/BSS, business processes, and customer
data working in an “interactive and fully dependent relationship”. Such business redirection has
yielded several business benefits including reduced cost of operations, improved customer
satisfaction, scalability sufficient to meet the demands of rapid subscriber growth, and enablement
of new business models in the ever-changing communications marketplace. It follows logically that
as the converging communications market continues to advance, so will the capabilities IBM brings
to bear through its SPDE-based solution strategy.


Karl Whitelock                                                                      Nancee Ruzicka
Senior Consulting Analyst – OSS/BSS Global Competitive Strategies (OSSCS)           Senior Research Analyst - OSSCS
Stratecast a division of Frost & Sullivan                                           Stratecast a division of Frost & Sullivan
kwhitelock@stratecast.com                                                           nruzicka@stratecast.com




IBM SPDE – Enabling Service Providers           © Stratecast (a Division of Frost & Sullivan), 2009                   Page 17
IBM SPDE – Enabling Service Providers to Work Smarter
                                                                               A Stratecast Executive Whitepaper




About Stratecast
Stratecast assists clients in achieving their strategic and growth objectives by providing critical, objective
and accurate strategic insight on the global communications industry. As a division of Frost & Sullivan,
Stratecast’s strategic consulting and analysis services complement Frost & Sullivan's Market Engineering
and Growth Partnership services. Stratecast's product line includes subscription-based recurring analysis
programs focused on Business Communication Services (BCS), Consumer Communication Services (CCS),
Communications Infrastructure and Convergence (CIC), OSS and BSS Global Competitive Strategies
(OSSCS), and our weekly opinion editorial, Stratecast Perspectives and Insight for Executives (SPIE).
Stratecast also produces research modules focused on a single research theme or technology area such as
IMS and Service Delivery Platforms (IMS&SDP), Managed and Professional Services (M&PS), Mobility
and Wireless (M&W), Multi-Channel Video Programming Distribution (MVPD), and Secure Networking
(SN). Custom consulting engagements are available. Contact your Stratecast Account Executive for advice
on the best collection of services for your growth needs.



About Frost & Sullivan
Frost & Sullivan, the Growth Partnership Company, partners with clients to accelerate their growth. The
company's TEAM Research, Growth Consulting, and Growth Team Membership™ empower clients to
create a growth-focused culture that generates, evaluates, and implements effective growth strategies. Frost
& Sullivan employs over 45 years of experience in partnering with Global 1000 companies, emerging
businesses, and the investment community from more than 30 offices on six continents. For more
information about Frost & Sullivan’s Growth Partnership Services, visit http://www.frost.com.


                                             CONTACT US
      For more information, visit www.stratecast.com, dial(a Division of Frost email inquiries@stratecast.com. 18
    IBM SPDE – Enabling Service Providers     © Stratecast
                                                           877-463-7678, or & Sullivan), 2009               Page
                                                                                 TLE03001-USEN-00

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IBM SPDE - Enabling Service Providers to Work Smarter

  • 1. March 2009 IBM SPDE – Enabling Service Providers to Work Smarter An Executive Brief Sponsored by IBM
  • 2. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper Frost & Sullivan reports are limited publications containing valuable market information provided to a select group of customers in response to orders. Our customers acknowledge when ordering that Frost & Sullivan reports are for our customers’ internal use and not for general publication or disclosure to third parties. No part of this report may be given, lent, resold, or disclosed to non-customers without written permission. Furthermore, no part may be reproduced, stored in a retrieval system, or transmitted in any form or by any means, electronic, mechanical, photocopying, recording, or otherwise, without the permission of the publisher. For information regarding permission, write: Frost & Sullivan 7550 West Interstate 10, Suite 400 San Antonio, TX 78229 United States IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 2
  • 3. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper IBM SPDE – Enabling Service Providers to Work Smarter Table of Contents Executive Summary ............................................................................................ 5 The Converging Communications Marketplace ................................................ 6 Industry Convergence ...........................................................................................................6 New Generation Service Offerings – Lifestyle Services ........................................................6 Addressing CSP Business Change ........................................................................................7 IBM’s Strategy for Communications Industry Evolution................................... 8 IBM’s Service Provider Delivery Environment (SPDE) .......................................................8 SPDE 3.0 – Service Delivery AND Business Process Support ........................................... 10 Addressing Key Industry Imperatives................................................................12 Accelerate Service Innovation & Delivery........................................................................... 12 Evolve to Optimized Operations......................................................................................... 13 Differentiate the Customer Experience .............................................................................. 15 The Last Word ...................................................................................................17 IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 3
  • 4. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper IBM SPDE – Enabling Service Providers to Work Smarter List of Figures Figure 1 – The Market Drivers of Change.................................................................................6 Figure 2 - Business Transformation is More Than a Shift in Business Strategy......................8 Figure 3 - IBM SPDE Framework Evolution (2001 to Today) ............................................... 10 Figure 4 – IBM Service Provider Delivery Environment 3.0................................................... 11 Figure 5 – Expands Source of Innovation and Shortens Development Cycle........................ 12 Figure 6 – Focus on Business Optimization is Accelerating.................................................. 14 Figure 7 - Optimize Service Quality and Focus on Customer Value...................................... 15 IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 4
  • 5. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper IBM SPDE – Enabling Service Providers to Work Smarter Executive Summary Those communications providers that don’t own their own access networks often understand well how to effectively market to business customers and consumers, and because they are not endowed with “incumbent” status, are the very organizations that are changing the Communications Service Provider (CSP) competitive landscape. Smartphone devices from various manufacturers are presently associated with several network-based operators around the world, which combine 2.5G/3G network connectivity with internet-based content and applications. However, this strategy is likely to change in the near future as consumer electronics and mobile voice technology are rapidly consolidating. Voice communications as an IP service—VoIP via a broadband connection—is just one of many applications enabled from a single device by customers for a variety of business and personal needs. For CSPs to “stay up with technology” huge demand—at an increasingly faster pace—is now placed on internal IT resources to better enable today’s installed Operations Support Systems (OSS) and Business Support Systems (BSS). Along with systems change is a heavy requirement to update and modify the business processes tied to defining new services, providing customers with choice in service options, provisioning each service, billing for service usage and of course assuring each service works every time the customer expects it to work. Tied to these requirements are the increasing levels of network flexibility offered through the latest advances in technology infrastructure, which are driving service availability to any time, anywhere, on any device. In addition, there is a growing awareness of network, service, and customer data to be collected, processed and harvested for better understanding of customer needs and to more effectively match those needs with business capability. This report discusses the key business drivers moving the communications industry toward “customer lifestyle services.” Such services require a variety of capabilities CSPs must address regarding both network connectivity and content interaction. The report points out why today’s CSP installed systems and business processes must be transformed to more effectively meet the changing needs of the converging communications industry. It provides a brief history concerning IBM’s Service Provider Delivery Environment (SPDE) strategy. The bulk of this report summarizes the latest capabilities IBM’s SPDE 3.0 brings to bear and highlights a number of case examples successfully addressing the transformation challenges CSPs must deal with today and in the near- term future. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 5
  • 6. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper The Converging Communications Marketplace Industry Convergence Today’s market landscape is much more than simply the convergence of fixed line and mobile technologies. The telecommunications industry is converging with the means of other markets including those from IT (e.g. data storage, security functions, and applications), media (print and broadcast news), entertainment (gaming, video, broadcasting), and advertising. As shown in Figure 1 below, convergence of these multiple industries is defining business drivers that are producing new capabilities for better meeting today’s customer “lifestyle” needs. For the CSP community, such change is driving a new level of “real time” Operations Support Systems (OSS) and Business Support Systems (BSS) requirements, which in turn are placing an overwhelming demand on Information Technology (IT) resources to change, enhance and/or replace existing OSS/BSS. Figure 1 – The Market Drivers of Change Converging Marketplace Key Business Drivers Consumer Electronics Device Evolution + Communications Network, IT and Infrastructure Mobile, Fixed CSP Business Maturation Access Data Retention Regulatory Change Competitive Play Corp Comply New Business Models Through Customer Lifestyle Services Examples of Lifestyle Service Enablers: Network services (VM, Email, voice, SMS, MMS, VoIP, IPVPN, IPTV, telepresence, …) User definable controls based on transaction volumes, relationships and financial limits Business applications (office, sales, medical, supply chain, …) Personal lifestyle preferences (fitness, geriatric, pets, social) Content (media and/or entertainment) Advertising sponsorship of voice minutes and text message for consumer opinion Several others … Source: Stratecast New Generation Service Offerings – Lifestyle Services Stratecast defines customer lifestyle services as any combination of network capabilities, content, and user device features for addressing a variety of lifestyle preferences defined by business, social or personal interest categories. These complex offerings can involve a number of capabilities alone or together including: multiple network access methods (broadband, mobile, fixed line); network services (email, VM, voice, and IP-X e.g. IP-VPN, IP-PBX, IPTV); IT functions (data storage, business applications, single sign-on security); media and/or interactive content. Examples of such services, which are deployed by some organizations already, include the following: IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 6
  • 7. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper • Interactive Multi-flow Messaging – The best example of multi-flow messaging services comes from the entertainment sector, and in particular, gaming, with its real-time, coordinated multi-flow needs (e.g. game logic flow, video flow, communication flow via voice or IM, and a player presence flow). Other multi-flow services for both business and consumers are also possible including distance learning, social networking, telepresence meetings, high-technology collaborative research, transportation/logistics management, and marketing/sales coordination. • Business Application Solutions – Business solutions can take on many forms involving packaged or individualized groupings of network/content functions such as email, office applications, data storage, security, VoIP, specialized applications particular to an industry vertical, and a variety of push or pull content sources. Some operators even include the necessary user device tools based on Software as a Service (SaaS) models. • Telemedicine – Telemedicine services include several areas as the healthcare industry looks for ways to cut costs including: life function monitoring (pacemaker/defibrillator heart monitoring, high risk fetal/neonatal monitoring, and “at-home” geriatric monitoring) via a wireless or fixed line connection tied to “on-tap” analysis applications or specialized customer care services; clinical records analysis and correlation between healthcare facilities and/or insurance companies via common data storage and secure access; medical imaging data storage and retrieval through remote secure access; and for patients with chronic medical conditions, records coordination between same provider clinics and multiple healthcare facilities via patient-authorized secure assess. • Machine-to-Machine Interaction – Remote monitoring and assembly of raw data to usable “information blocks” that are then passed to other “added value” applications. Examples include remote device dispenser monitoring integrated to a supply chain system or aggregation of remote sensor fluid flows with critical manufacturing environmental definitions for optimizing service delivery performance. • Health and Fitness – Bringing together presence and availability functions to chart jogging progress via a GPS-enabled mobile device. The long-term opportunity may even allow a mobile device to possess health monitoring capabilities (e.g. pulse, blood pressure, oxygen saturation, and respiration rate) based on a user-defined set of conditions combined with individual presence (location, time from start, pace, and time-to-completion). Processes and systems to support these new services, and in many cases engage as part of the service, are redefining the way OSS/BSS are used globally. Addressing CSP Business Change Based on network technology and personal electronics evolution, business customers and consumers now have choice when addressing a growing list of needs—in network access, in service definition and manageability, in interacting with media and entertainment content, and even in how services are subscribed and paid for. Several of these choices now involve some type of real-time manageability features. The thrust of today’s needed change in business approach, as shown in Figure 2 below, rests in realignment of processes, systems, and the way business is conducted. This is essential to better address a variety of the multiple issues involving offers of lifestyle services. Many of the large business solution suppliers have recognized this shift and are now much more focused on end-to-end business improvements, while others are still trying to get it right. For IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 7
  • 8. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper example, IBM continues working with several different CSPs around the world to redefine the way they do business. This is accomplished by emphasizing new ways to address subscriber growth while at the same time making improvements to processes and systems to reduce operating costs, improve overall end-user satisfaction, deliver more appealing lifestyle services as a point of differentiation and to successfully augment declining revenues from traditional services. Figure 2 - Business Transformation is More Than a Shift in Business Strategy Key Business Drivers Consumer Electronics Device Evolution + Communications Infrastructure Network, IT and Mobile, Fixed CSP Business Model Processes CSP Business Strategy CSP Business Maturation Access Data Retention Start Finish Regulatory Change Competitive Play Corp Comply People Business Transformation is a Systems CSP’s reaction to new and/or changing business drivers in realigning strategy, processes, systems and the way people conduct business to best Network 3rd Party address customer expectations Infrastructure Partners & Suppliers and to provide the greatest shareholder value. Source: Stratecast 1 For CSPs that have taken the first steps in the transformation journey for their business processes and systems to address the new generation customer lifestyle services, the future looks very promising. For those considering what to do next there is time. However, holding back to wait out the current storm of economic uncertainty is not a safe harbor. As technology evolution continues, CSPs still deciding on a “best strategy” for their business needs should look closely at partnering with a supplier possessing proven transformation credentials. Choosing an unproven path, given today’s economic uncertainties, substantially increases the risk of major disappointment and serious business concern in the months to come. IBM’s Strategy for Communications Industry Evolution IBM’s Service Provider Delivery Environment (SPDE) In early 2001, IBM identified the telecommunications market as one of its strategic focus areas, with specific attention to the top 25 global CSPs. To serve this segment, the company introduced the 1 Business transformation within the communications industry is a journey and not a destination. Stratecast defines it is as a CSP’s reaction to some or all of today’s business drivers (technology evolution at both the network and user device level, changing regulation, and a maturing of the CSP marketplace) in realigning strategy, processes, systems and the way people conduct business to best meet the needs of technology evolution, changing customer expectations, and in providing the greatest shareholder value. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 8
  • 9. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper Service Provider Delivery Environment (SPDE), which was defined as IBM’s current go-to-market strategy for the telecommunications sector. More specifically, a Stratecast report assessing IBM’s foray into the telecom sector stated: “SPDE includes an IBM-supplied reference architecture for application integration and business process management, professional services, demonstrated integration capability through the company’s Network Integration Labs (NIL), pre-defined process templates, an extensible data platform, and partner programs.” 2 IBM officially launched SPDE in February 2002, defining it as a “… comprehensive delivery and management architecture for content and applications through multiple transport environments without significant modification. It is based on open IT and telecom standards and is designed to take advantage of telco industry standards such as Parlay and OMA (Open Mobile Architecture) as they emerge, as well as key emerging Internet standards such as UDDI, WSDL, and SOAP that are key to delivering Web Services.” 3 Shown in Figure 3 below, the 2001 SPDE framework was focused on supporting mobile data services in a way that was standards-based in a soon-to-be-proven cost effective manner. It would also allow CSPs to introduce traditional network services combined with application and content capabilities. From these early beginnings SPDE was clearly designed to be more than a technical architecture, as consideration for the end-to-end business needs tied to addressing the evolving new generation of “network connectivity plus content” services was starting to take shape. Keeping pace with technology evolution, SPDE 2.0 was launched in early 2006. In addition to what SPDE 2001 offered, the new version included Telecom Operations Content Packs based on industry standards from the TM Forum 4 , an advancement of Web Services functions in the form of Service Oriented Architecture (SOA) standards, and “… extensions to accommodate the specific requirements of the 3GPP 5 IMS architecture. The solution comprises two main environments -- Service Execution and Service Creation.” 6 Specifics about each of these extensions, with reference to a major implementation project for Swisscom at the time, included the following: • Service Creation Environment – The Service Creation environment was defined as a “… model-driven and integrated set of tools for creating, deploying and reusing services and software components. The environment includes a well-defined and automated process 2 Stratecast Report “OSSCS 03-04 An Assessment of IBM’s Telecom Strategy: Service Provider Delivery Environment (SPDE),” August 2002. 3 IBM Press Release “IBM Offers 'Speedy' Introduction of Next-Generation Wireless and Telecom Services – New Framework Cuts Development Time from Months to Weeks,” February 19, 2002. 4 IBM’s Telecom Operations Content Packs incorporate standards definitions based on the TM Forum’s Next Generation OSS (NGOSS) enhanced Telecom Operations Map (eTOM), NGOSS Telecom Applications Map (TAM), NGOSS Shared Information Data (SID) model, NGOSS OSS through Java (OSS/J) interface definitions, and the NGOSS Multi-Technology Operations Systems Interface (MTOSI) for messaging schemas. 5 The 3rd Generation Partnership Project (3GPP) is a collaboration effort between groups of telecommunications associations, to make a globally applicable third generation (3G) mobile phone system specification. 6 IBM Press Release “Telecommunications Operators Can Reduce Time-to-Market With New Platform – Swisscom Mobile and IBM Have Demonstrated the Capability to More Efficiently and Rapidly Create Telecom Services and Incorporate Third-Party Applications,” February 13, 2006. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 9
  • 10. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper offering guidance across the service creation lifecycle. The domain is realized using an integrated set of technology including IBM's WebSphere and Rational software ….” 7 • Service Execution Environment – In an early deployment at Swisscom, the Service Execution environment utilized “… Nortel's IMS control plane located at IBM's Montpellier facility and which is connected to Swisscom Mobile's network via IP VPN circuits.” 8 Figure 3 - IBM SPDE Framework Evolution (2001 to Today) 2009 – SPDE 3.0 Service Oriented Architecture 3rd Party Domain Service Execution Domain Support Systems Domain 3rd Party Access Process Choreographies Core Runtime Functions Service Core OSS & BSS Functions Runtime Support Billing Content & Media Assuranc Ideas to Web 2.0 e Fulfillmen Deployment Service Convergent Services Applications t Care User Interaction Portal & Personalization Information Management 2006 – SPDE 2.0 Presentation Network Abstraction Layer Network Access Network Delivery Domain Device Domain User interaction Device Support Business Intelligence Security 2001 – Framework Introduction Ap p lica tio n D e liv ery E n viron m e nt U sers D evices Netw ork S ervice s Bro kerage U ser S ervices Delivery Prov is io ne d As s e ts (inte rnal) M obile P re s e nta tio n B us ine s s App lica tions S ervic e s B roa d - N e tw o rk Lo c atio n S e rvic e s B a nd S e rvic e s othe r C ore IP B2B Co m m e rce G a te w a y PST N M e s sa g ing Subs c rip tion o the r S e rvic e s C onne c te d (ex te rnal) C onte nt a nd A pplic a tio ns In te g ra tio n O p era tions Sup port & S ervice s Fina ncial Re a dine ss (C RM ) M an agem ent S ervices Hu b B usin ess P ro cesses and W o rk flow Ex te rna l F ulfillm e nt As s ura nc e B illing other Se rv ice s S e rvic e s Se rvic e s Source: IBM SPDE 3.0 – Service Delivery AND Business Process Support The SPDE 3.0 Framework, shown in Figure 4 below, was announced in February 2009 9 . Beyond what SPDE 2.0 provided, the current version includes capabilities not typically identified with the technology architecture the industry today has come to call a Service Delivery Platform (SDP). While no specific industry standard has been established for an SDP, the basic expectations from any such services framework involves: the ability for a CSP to create new services from various network-based building blocks; implement these services and control their behavior when operationalized within a public or private communications network; and interface through standard protocols with existing network equipment. 7 Ibid. 8 Ibid. 9 IBM Press Release “IBM Unveils Next Generation Service Delivery Framework to Help Communications Service Providers Thrive in an Interconnected World,” February 11, 2009. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 10
  • 11. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper Figure 4 – IBM Service Provider Delivery Environment 3.0 Service Oriented Architecture 3rd Party Domain Service Execution Domain Support Systems Domain 3rd Party Access Process Choreographies Service Creation Core Runtime Functions Service Core OSS & BSS Functions Domain Runtime Billing Content & Media Support Assurance Ideas to Web 2.0 Deployment Service Fulfillment Convergent Services Applications Care User Interaction Portal & Personalization Information Management Presentation Network Abstraction Layer Network Access Network Delivery Domain Device Domain User interaction Device Support Business Intelligence Security Source: IBM What makes SPDE 3.0 more than just a technology architecture is its focus on the end-to-end solution support picture pertaining to the business issues around today’s customer-focused complex lifestyle services. Some of these “operational and management functions”, beyond the actual service delivery capabilities previously mentioned include: • An ideation environment that can evolve service concepts to service implementation realities • Advances in SOA-based business processes critical for immediate support of new service options • Media integration functions in the form of composite services for enabling CSPs to blend entertainment, advertising and other forms of digital media into complex customer services that can be offered across a variety of networks and devices • Service runtime support for core OSS/BSS functions including customer care, fulfillment, billing and assurance • Expansion into the service management domain to help automate and secure a dynamic infrastructure of applications, systems and networks • Business intelligence capabilities for analyzing consumer usage behaviors and trends as a means for helping CSPs improve the success of their service portfolio, better understand customer preferences, and improve overall network performance • Advanced security functions. IBM has approached the business transformation challenge, through SPDE 3.0, with numerous customers emphasizing a variety of focal points. Some of these are approaching transformation from the service innovation and exposure perspective. Others are going about it from an IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 11
  • 12. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper information management, service assurance and even multi-systems integration point of view. Since no two CSP business strategies are alike, to better explain how SPDE 3.0 addresses a number of needs within the CSP marketplace today, the balance of this report offers several customer case examples tied to the following critical business functions: • Accelerating the rapid definition and launch of new services • Reducing the cost of operations and optimizing understanding of operational information • Differentiating the end-user customer experience. Addressing Key Industry Imperatives Accelerate Service Innovation & Delivery • The SPDE 3.0 service creation and execution domains are a major point of emphasis for CSPs looking to expand their service footprint through offerings with appeal to the customer lifestyle needs previously described. As shown in Figure 5 below, the Service Innovation, Design and Creation process is set up to enhance the “idea-to-implementation” portion of a new service launch. Figure 5 – Expands Source of Innovation and Shortens Development Cycle Partners Service 3rd Party Access to Innovation exposed enablers 3rd Party Domain 3rd Party Access Service Execution Domain Service Service Service Applications Content Runtime & Media Creation Support Service Web 2.0 Domain Design and Creation Convergent Services Service Execution Network Abstraction Layer Network Delivery Domain Service Exposure of Network Enablers Subscribers Source: IBM Components of SPDE 3.0 supporting this need include: • Service Innovation – Uses IBM’s array of initiatives with Web 2.0 for a dynamic and connected “ideation” process. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 12
  • 13. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper • Service Design and Creation – Incorporates IBM’s Rational service creation capabilities for building IP-based converged communications applications. This involves a suite of tools tied to service concept & definition, service design, service development, service testing, and service deployment. • Service Execution – IBM’s WebSphere execution platform provides a common SOA- based approach for composite service applications, leveraging presence, voice, media and IT enablers. • Service Exposure – Industry-standard Web service exposure of telecom network capabilities and connections into the Web 2.0 world. Implementation examples include the following: • Improving Service Innovation and Time-to-Market – A large Asian CSP implemented IBM’s Idea Factory to create a collaboration environment for product managers, partners, and end-users. Idea Factory is part of the IBM Service Innovation, Design and Creation Domain. In this example, a portal allows product managers to set up a trial using templates and tools to on-board users, conduct surveys, prompt for feedback, collect all responses, and analyze results. During a 9-month period, this CSP was able to identify 27 new services based on 576 defined ideas. Without Idea Factory, only 3 new services from 259 ideas were previously established in approximately the same time period. The first suggestion was entered to the system only 10 minutes after initial implementation, which showed the level of interest in this advanced way of bringing a number of thought/action processes together. • User Assisted Service Definition – A large Asian operator sponsored a contest to develop next generation applications. Controlled access to network information from services such as SMS, call control, presence and IMS to internal employees and external users was provided as Web services. By offering a secured environment this operator successfully demonstrated it can tap into the creativity and innovation of third party developers and Web 2.0 clients. Going forward, this CSP views such practices as essential in its quest to rapidly respond to new market opportunities, to explore new potential revenue streams, and to extend its market reach with finer grain targeting of select service offerings. Evolve to Optimized Operations The SPDE 3.0 service runtime support and information management domains allow CSPs to capitalize on dynamic process integration and information management capabilities. It involves SOA-based integration of various business processes using IBM’s Telecom Operations Content Pack. This consists of approximately 150 pre-built business processes addressing the assurance, fulfillment and billing functions using the TMF NGOSS definitions including eTOM, TAM, SID, OSS/J and MTOSI. The content pack assets are then pre-certified, tested, and supported on IBM’s middleware layer. Beyond process integration, the SPDE 3.0 approach also paints a course for CSPs to capitalize on customer and product/service information using master data management, information integration, and business intelligence functions to optimize their businesses. This is a journey as shown in Figure 6 below. Creating an “Information Agenda” now is critical for CSPs to leverage their information (customer, product, service, and network) as a strategic asset in establishing and sustaining competitive advantage. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 13
  • 14. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper Figure 6 – Focus on Business Optimization is Accelerating Source: IBM Business optimization examples include the following: • Delivering Innovative Services with Greater Speed and Quality – Since implementing SPDE 3.0 a large European mobile operator has reduced the time required to integrate and deliver new services to its target market by 64%. By using a common platform and service bus, this CSP also expects a 19% reduction in the total cost of ownership over five years. This cost reduction includes several points: software license and maintenance, hardware, new service startup costs, implementation, business model change, and Enterprise Service Bus (ESB) maintenance. • Integrating New Services with Existing OSS/BSS – Reusable integration templates (IBM Telecom Operations Content Pack) applied across services and channels reduces order-to-cash delays, reduces fall out, and improves customer satisfaction. An Asian mobile CSP used a portion of SPDE 3.0 to construct a flexible service-oriented architecture. Using that foundation, this CSP was able to broker approximately 5,000 messages per day between previously siloed OSS/BSS. The solution cut average problem resolution time from two days to less than one hour, helping to boost customer satisfaction levels. An Eastern European CSP also uses a SPDE 3.0 configuration to accelerate provisioning time for new subscriber services from several days to several minutes using existing OSS/BSS. • Unlocking the business Value of Information to Create Competitive Advantage – By creating and maintaining an accurate view of the customer, other business units can utilize the data to determine offers and discounts or insert advertising. Meshing customer, service, and network information enhances the ability to define, deliver, and support new revenue generating services. A South American CSP implemented a data warehouse solution based on IBM DB2 Warehouse. The resultant data warehouse contains more than five years of IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 14
  • 15. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper information and supports most of the CSP’s key business processes, including marketing, financial, commercial and network systems. The system uses advanced data mining techniques to identify the most profitable customers and predict payment delays. Since the data warehouse has been in place, this CSP reports it has avoided revenue losses of approximately $4 million per month. Differentiate the Customer Experience The SPDE 3.0 framework is designed to improve the customer experience by offering multiple capabilities and functions in service management and security. As shown in Figure 7 below, IBM’s SPDE 3.0 Service Management offering can address a number of different functions. Figure 7 - Optimize Service Quality and Focus on Customer Value Source: IBM The three aspects of this strategy rest with visibility, control and automation as defined by the following: • Visibility for Improving Service Quality and Customer Retention – SPDE 3.0 service management solution provides: end-to-end visibility of services across multiple network and IT technology domains; delivers a visual link between customers, infrastructure and SLA definitions; provides instantaneous notification of any SLA violations; monitors for service quality through Key Performance Indicators (KPI) and Key Quality Indicators (KQI); and can pinpoint service-affecting events and the impact such events will have on service availability and quality. • Control to Maximize Return on Assets and Reduce Risk – SPDE 3.0 service management solution offers: monitoring of all network/IT assets (IT data center operations, mobile base station utilization and network node capacity) for maximizing usage and IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 15
  • 16. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper identifying unused capacity; improvements in labor efficiency through combined helpdesk support for network, IT and even customer needs; improved governance and compliance through single sign-on and authorization by network or operations asset type/function; and manage the explosive demand for data storage tied to content-based services. • Automate and Streamline Management Processes to Accelerate Growth – SPDE 3.0 service management solution supports a number of business needs including: a single view of events and management details from both new and existing service assurance tools to reduce complexity and deliver a more effective means for isolating problems; tracks more than 100 million events per day; correlates this data and reports on top-end issues for operator resolution; and monitors end-to-end business processes to identify issues and business challenges. Industry progress within the service management and security domain, especially with regard to differentiating the customer experience, include the following CSP case examples: • Preventing and Responding to Security Threats – With more services in use by more customers, the risk of compromise is significant. SDPE 3.0 provides the ability to secure applications, services, and service access while managing users and service usage changes. This includes federated identification and secure portal integration. For example, by using the IBM DataPower Appliance as the front end of a Web Services Gateway, a North American operator was able to expose services to subscribers and partners while also ensuring security. The IBM DataPower appliance provides authentication, authorization, and audit functions in addition to content-based routing utilizing digital signatures and encryption features, validation of schemas, and protection against malicious attacks. The deployment is clustered in the CSP’s wireless network. • Improving Quality of Service and Reduce Customer Churn – Real-time end-to-end network and services visibility allows CSPs to maximize utilization of existing assets while ensuring security and survivability. As a means for proactively delivering high quality voice and data services, a European mobile CSP presently utilizes IBM Tivoli Netcool to monitor business and consumer services across its mobile infrastructure. The ability to manage its network in real time and anticipate problems is a key differentiator for this operator in reducing the level of customer churn. Automated event correlation and analysis has reduced the number of daily events from 20,000 to 4,000 and subsequently reduced the resources required to manage the network by a significant level. Through this approach the NOC staff gains a better understanding of the impacts of service degradation, resulting in executing trouble resolution processes aimed at addressing critical customer-affecting problems first. IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 16
  • 17. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper Stratecast The Last Word Network technology advances and mobile user device evolution have enabled a new generation of complex customer services making up today’s “real time” world. These services compel CSPs to transform many of their business processes to recognize systems functions—within customer care, billing and provisioning especially—as a working part of each service. They are also ushering in a new generation of business models that look to deal with customer lifestyle needs first, then on how these needs impact the content, service, application, and network layers. Most importantly, customer lifestyle services are placing requirements on current business processes and installed systems they were never designed to address, especially regarding capabilities tied to real time verification, validation and notification. From managing evolving requirements to accelerating and delivering change, a collaborative customer data and product/services lifecycle management platform such as IBM’s SPDE, creates consistency and continuity of software processes, data, and delivery. Stratecast believes business transformation requires not only flexible systems but also an automated means for adjusting business processes and the work tasks that will be completed by human resources. It further requires dedication to better response time from applications, more effective generation and notification of customer usage charges, rapid assimilation of service enablers to meet unique customer needs and near real-time settlement with partners to name just a few. A CSP’s OSS/BSS environment can no longer provide passive support; it must be part of the new wave of customer service offerings. Beyond this, harvesting the richness of network, product, service and customer data to optimize business performance can no longer be ignored if competitive positioning and new revenue generation are now major imperatives for long-term success. SPDE 3.0 has proven it is possible to transform the way CSPs conduct business to a new tightly integrated approach involving network technology, OSS/BSS, business processes, and customer data working in an “interactive and fully dependent relationship”. Such business redirection has yielded several business benefits including reduced cost of operations, improved customer satisfaction, scalability sufficient to meet the demands of rapid subscriber growth, and enablement of new business models in the ever-changing communications marketplace. It follows logically that as the converging communications market continues to advance, so will the capabilities IBM brings to bear through its SPDE-based solution strategy. Karl Whitelock Nancee Ruzicka Senior Consulting Analyst – OSS/BSS Global Competitive Strategies (OSSCS) Senior Research Analyst - OSSCS Stratecast a division of Frost & Sullivan Stratecast a division of Frost & Sullivan kwhitelock@stratecast.com nruzicka@stratecast.com IBM SPDE – Enabling Service Providers © Stratecast (a Division of Frost & Sullivan), 2009 Page 17
  • 18. IBM SPDE – Enabling Service Providers to Work Smarter A Stratecast Executive Whitepaper About Stratecast Stratecast assists clients in achieving their strategic and growth objectives by providing critical, objective and accurate strategic insight on the global communications industry. As a division of Frost & Sullivan, Stratecast’s strategic consulting and analysis services complement Frost & Sullivan's Market Engineering and Growth Partnership services. Stratecast's product line includes subscription-based recurring analysis programs focused on Business Communication Services (BCS), Consumer Communication Services (CCS), Communications Infrastructure and Convergence (CIC), OSS and BSS Global Competitive Strategies (OSSCS), and our weekly opinion editorial, Stratecast Perspectives and Insight for Executives (SPIE). Stratecast also produces research modules focused on a single research theme or technology area such as IMS and Service Delivery Platforms (IMS&SDP), Managed and Professional Services (M&PS), Mobility and Wireless (M&W), Multi-Channel Video Programming Distribution (MVPD), and Secure Networking (SN). Custom consulting engagements are available. Contact your Stratecast Account Executive for advice on the best collection of services for your growth needs. About Frost & Sullivan Frost & Sullivan, the Growth Partnership Company, partners with clients to accelerate their growth. The company's TEAM Research, Growth Consulting, and Growth Team Membership™ empower clients to create a growth-focused culture that generates, evaluates, and implements effective growth strategies. Frost & Sullivan employs over 45 years of experience in partnering with Global 1000 companies, emerging businesses, and the investment community from more than 30 offices on six continents. For more information about Frost & Sullivan’s Growth Partnership Services, visit http://www.frost.com. CONTACT US For more information, visit www.stratecast.com, dial(a Division of Frost email inquiries@stratecast.com. 18 IBM SPDE – Enabling Service Providers © Stratecast 877-463-7678, or & Sullivan), 2009 Page TLE03001-USEN-00