YOU ARE AT:5GThe Rise of Telecom SaaS

The Rise of Telecom SaaS

Services of all kinds are today largely digital — customers expect it, and businesses have benefited from it, saving time and money and agilely expanding services. “As a service” is the new watchword for IT, security and web services, and telecom needs to adopt “as a service” as well. Customers have become accustomed to the convenience, choice and low cost of SaaS, PaaS and the other as-a-service offerings available — and traditional CSPs need to develop those kinds of flexible, on-demand services for their customers if they expect to compete with newcomers, who are leveraging the cloud to provide telecom SaaS.

Indeed, cloud-based software for digital communications is now far more popular than the managed services CSPs traditionally provided. Among the significant examples are messaging platforms, such as WhatsApp, that are far more popular than SMS. Even if CSPs at this point offer unlimited SMS packages, people have gotten used to using apps like WhatsApp, Facebook Messenger and others. It’s clear, then, that CSPs have lost out on the messaging market.

If you can’t beat ’em, join ’em, goes the old saying, and CSPs have begun to realize that they, too, can leverage the cloud to offer their customers the kind of internet-based services they want. But there’s little sense in trying to compete in a market where competitors are giving away the product (i.e., messaging) for free; instead, CSPs need to seek out new markets where technology will give them an advantage over cloud-based rivals.

And the opportunity to do that is right at their doorsteps in the form of 5G-based services, which customers — especially enterprises, manufacturing companies and SMBs — will be seeking out. By leveraging the cloud to offer 5G-based services, CSPs will be able to offer a wide variety of services that will ensure high customer satisfaction and keep income flowing in. 

Especially exciting for CSPs is the opportunity 5G gives them to develop advanced capabilities for customers with software and services customized for those networks. Indeed, a key aspect of CSP SaaS will be the ability to offer customized 5G services. For example, with cloud-based SaaS, CSPs can utilize technologies like network slicing, providing advanced services to all customers. And by developing that capability into a SaaS application, CSPs give their customers the ability to manage those resources as they see fit, when they see fit. The combination of powerful 5G hardware and the open software systems that are part and parcel of 5G provides CSPs with the ability to stake their claim in SaaS for the benefit of themselves and their customers.

This kind of approach and level of service is only possible with 5G systems. CSPs will be able to offer these kinds of automated services as a result of virtualized network functions inherent in 5G, utilizing systems (NFV, SDN) built into 5G equipment that will be deployed as part of the overall network. 5G is far more of a software story than a hardware one, and the open nature of the software systems powering 5G (ORAN, vRAN) will allow for as much customization as needed. SaaS means lower costs for CSPs, who don’t have to invest in hardware every time they want to offer a new service and a better deal for customers, who aren’t locked into a perpetual subscription for excessive services.

With virtualization, CSPs will be freed from the limitations inherent in existing networks, as nearly all functions will be virtualized. CSPs will be able to offer completely virtualized and customized applications to customers. For example, with cloud-based SaaS, customers save time, effort, and hassle in deploying services that are available to them at the touch of a button.

Where will these automated services come from? CSPs could, of course, build their own development departments, but a better option might be to leverage existing development teams. CSPs could partner with tech companies to develop the SaaS applications that will be the backbone of their new SaaS businesses, providing customers with the level of service and kind of interfaces they have become used to. 

Since many of these services will be customized, they will allow CSPs to offer services that previously weren’t available like zero-latency communications and connections in specific geographical areas or for specific customers, on demand, providing CSPs with revenue opportunities that haven’t existed until now. And customers will be happy to pay; the ability to control their resources and get the services they want when they need them will be incentive enough for businesses of all types to utilize the services CSPs offer. Partnering with developers helps operators avoid the expense and hassle of developing solutions on their own, enabling them to concentrate on the work they do best.

One caveat for CSPs will be in how they bill and service customers. The traditional option would be providing a whole package of services for a single fee, with different tiers based on the services customers want. Because many of these services will be customized, CSPs will have to pay a lot more attention to how they work with and bill customers. In addition, CSPs will need to ensure that their troubleshooting staff is able to deal with the esoterica of the customized apps that are in play, as well as ensuring that staff maintain the basic hardware, software and other elements that affect delivery of the services.

Of course, CSPs have been doing that until now — but in a 5G world, they may have to do more of it. What CSPs can do going forward in conjunction with the addition of services, service level requirements and more, is to charge for the suite of new or customized services using the novelty of the Usage Based Pricing which is becoming more and more common in the cloud-based SaaS offering market.

5G is going to bring a great deal of benefit to customers who need fast, near-zero latency communication and network capabilities, which will further empower customers to utilize their resources in the most efficient way possible. Done right, the 5G revolution will help CSPs grow their businesses, enabling them to hold their heads high in a SaaS world.


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