July  2000

Applications 'R Us 

BY KEVIN MAYER

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Next-Gen Services News
Blockbuster Video ... Applications
Operations Service Providers

And yet a sense of permanence may creep in. A child may like a particular configuration so much that it becomes a monument, essentially defeating the purpose of the Erector set, which is to encourage creative act after creative act. Similarly, in the telecommunications industry, it is possible to resist change, perhaps because a new structure seems risky, that is, because it lacks the appealing familiarity and security of the old structure.

However, in the telecommunications industry, particular constructions make sense in particular circumstances. And circumstances change. Today, with processing resources becoming so great, and transport so fast and capacious, constraints that once seemed inevitable are becoming increasingly arbitrary. Narrowband yields to broadband. The regulated pales before the unregulated. Formerly captive subscribers are free to choose. And the imposed order of traditional, hierarchical networks succumbs to the emergent order suggested by the Internet and its subversive, if obscure, internal logic.

To a service provider, these changes may suggest threats or opportunities, depending on its point of view -- that is, on its willingness to contemplate new ways of doing business, and its ability to restructure itself. What of the threats? They include the prospect of finding oneself stranded in a commodity business, with connectivity and bandwidth services yielding ever lower margins. What of the opportunities? They include positioning oneself as a value-add player, offering enhanced services.

This opportunity may involve becoming an applications services provider (ASP), or retailing the services of an ASP. These services may include enhanced telephony services -- PBX or Centrex functionality, unified messaging, and video conferencing -- the list may go on and on. And these services would be delivered over a packet telephony infrastructure, the way applications are delivered via the Web hosting model.

What will service providers make of this opportunity? Some may act boldly, dominating new markets. Others may delay, finding themselves relegated to the margins. The situation facing service providers resembles that facing children set loose on a pile of Lego blocks. Who will tear down and rebuild, and who will be left holding the odd block or two?

BY MARK COWTAN

If live two-way video were not a business application, but a feature film, it would probably move potential viewers to say, "Let's wait till it comes out on video." Although it has always had its attractions, live two-way video wasn't so compelling that potential users were inclined to overlook its disadvantages, which included high start-up costs, extensive training, and intensive IT support. But today, as the switched IP network comes into its own, and as network convergence takes hold, video services are emerging not as an expensive service to buy and maintain, but as a cost-effective service to "rent" via the application service provider (ASP) delivery model.

And the ASP delivery model is emerging at an opportune time -- just when companies are launching e-business and e-commerce initiatives to enhance customer and partner relationships. To enhance such initiatives, companies may want to take advantage of video applications such as video call centers and video chat rooms. But how? By outsourcing these functions to carriers, CLECs, and ISPs.

The ASP delivery model allows carriers, CLECs, and ISPs to offer customers an opportunity to conduct with ease everything from phone calls to critical data communications to call-center management to video chats and video mail over IP networks, with two-way interactive Internet video as the centerpiece.

Of course, by ensuring their customers have access to cutting edge technology, carriers, CLECs, and ISPs reap the benefits of the ASP delivery model as well. The financial benefits translate into a way to offer a new level of value-added services that potentially equates to multi-million dollar revenue streams, with minimal up-front technological research or investments. By offering video through the ASP delivery model, the needs of the customer, carrier, and service provider are all met in a cost-effective and time-efficient manner.

Mark Cowtan is director of product marketing for FVC.COM, which provides services and systems to enable systems integrators and service providers to deliver two-way video to their customers.

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BY TED CORBETT

Telecommunications service providers are keenly aware of new market opportunities made possible by technology advancements in network equipment, broadband access, and ever more sophisticated Subscriber Management Systems (SMS). At the same time, these providers face critical operational challenges where fundamental business assumptions are constantly in motion.

Established providers face challenges in both defending markets and entering new ones. Legacy Operations Support Systems (OSS) are complex and error prone. These providers must either extend their existing systems via middleware or perform snap-on application extensions to these systems. Unfortunately, both approaches are painful and time consuming.

New providers must build scalable and adaptable OSS. They are faced with lengthy OSS development schedules and costly implementation options. Meanwhile, their investors are anxious for results.

Addressing these issues is one area where current ASP models are insufficient for today's providers. This reality has paved the way for the evolution of a new, more specialized services segment in the telecommunications industry -- the Operations Service Provider.

To meet the OSS needs of today's providers, the OSP assumes responsibility for complex applications and integrations. The OSP presides over elaborate service delivery models. The OSP meets daunting challenges in the areas of capital investment, human talent, and operations infrastructure. The OSP delivers on operational commitments and maintains the high levels of security demanded by customers. The OSP offers ready-to-go suites of scalable, secure, multi-service OSS and services.

By assuming these burdens, the OSP allows providers to rapidly launch new services -- achieving unprecedented time-to-market objectives. The OSP carries the back-end burdens of new world network services, freeing providers to focus on their customers while best leveraging their network assets.

Ted Corbett is vice president of Corporate Development for Coreon. For more information, please visit www.coreon.com.

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