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TM Forum tracker: network transformation slow, despite being integral to digital transformation


  • Tracker reveals need for change in CSP/vendor relationships and importance of new talent for digital transformation success

London, UK— 18 October 2018TM Forum, the industry association driving digital transformation through collaboration, today released the results from its third bi-annual Digital Transformation Tracker (DTT). Conducted in the period June to August 2018, the global survey of more than 200 communications service providers (CSPs) and their technology suppliers tracks the progress of the telecoms industry’s digital transformation. The results show slower-than-expected progress towards network transformation, despite 44% of CSPs agreeing that it plays an integral part in digital transformation success.

According to the survey, 48% of CSPs still have not found the business case for virtualization. This is impacting progress as CSPs struggle to agree on where network transformation fits into the overall digital transformation journey. This is primarily due to:

  • The loose definition and interpretation of what a digital transformation program involves
  • The different objectives of network transformation programs and the constantly evolving timeframe for network virtualization and cloud adoption
  • The relationship between the IT and network divisions and between the technology part of the business and the consumer and enterprise lines of business

Despite the slow progress, on a positive note virtualization is moving in the right direction among CSP organisations. Nearly a third (32%) of CSPs surveyed revealed they are deploying NFV in the packet core, and 36% are deploying NFV at the mobile edge or have deployed virtual customer premise equipment (vCPE). What’s more, fewer respondents admitted to having no timetable for virtualization – 30% in the first DTT survey, compared to 23% today.

“The telecoms industry first started to embrace the concepts of network virtualization and software-defined networking eight or nine years ago. Today, it appears the majority of CSPs are moving from the awareness and planning phases of transformation to deployment of VNFs. This progress is a positive thing, albeit a lot slower than expected”, said Mark Newman, Chief Analyst at TM Forum. “However, the deployment of these virtual network functions has not had the transformative impact that many CSPs were hoping for. As a result, many are now moving beyond virtualization to full network cloudification.”

Network transformation challenges
When asked to rank the challenges of network transformation, over half (60%) of respondents cited the need to implement a new generation of agile OSS/BSS as their primary concern. A further 56% cited security vulnerabilities and 52% cited worries with lengthy maturity times for standards.

As CSPs’ network divisions seek greater agility and more automation, they must embrace new ways of working including practices such as DevOps and creating small, cross-functional teams. Yet while 77% of CSPs said that DevOps had been successfully deployed in many IT teams, just under a quarter (23%) have introduced the approach into network teams. In fact, the majority (67%) of CSPs admitted to not having introduced DevOps in their network teams at all.

The emergence of open source software has also forced CSPs and their suppliers to re-examine how they do business. For larger CSP organizations, it represents an opportunity to lower costs and to take back control of technology and roadmaps. The survey pointed to a significant drive to recruit more software developers across the whole business with more than a third (34%) of CSPs currently employing 100-250 software developers today expecting their company to boost this number to at least 500 within the next two years. For smaller CSPs, it’s an opportunity to cultivate symbiotic relationships with multiple vendors, rather than be subject to mega-vendor lock-in.

“The benefits of network transformation can only be achieved by using cloud-native software that can be modified through DevOps practices and easily integrated with solutions from suppliers using open source,” said Newman. “But it also requires CSPs to address network and operations transformation at the same time. If operators deploy new network capabilities without factoring in operational issues – for example OSS/BSS transformation – they risk complications further down the line.”

The future of OSS/BSS
Successful network transformation relies heavily on transforming OSS/BSS to take advantage of the new software capabilities. CSPs know this and, despite the many obstacles, the survey demonstrated that steps are already being taken to embrace a new generation of OSS/BSS. While one in three CSPs are delaying operations transformation and proceeding with network virtualization without addressing digital operations, half of CSPs are tackling the task of network virtualization in parallel to the transformation of operations. Another 13% agreed that network virtualization would begin once they have a plan in place for OSS/BSS transformation.

To meet the challenges brought about by virtualization deployments and the rise of multi-vendor solutions, TM Forum launched its Open Digital Architecture (ODA) in February 2018, designed to help CSPs and their suppliers re-imagine and evolve OSS/BSS. TM Forum’s ODA offers a standardized blueprint enabling vendors to participate in a marketplace for reusable solutions to common business challenges. For more information about ODA, please follow this link: https://www.tmforum.org/oda/

To compile its Digital Transformation Tracker, TM Forum surveyed 160 respondents from 66 communications service providers (CSPs) operating in 59 countries, and 76 respondents from 39 supplier companies. A full copy of the report can be viewed and downloaded here: https://inform.tmforum.org/research-reports/digital-transformation-tracker-3-network-transformation-difficult/. TM Forum repeats the tracker survey twice yearly.

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About TM Forum
TM Forum is an association of over 850 member companies that generate a combined US$2 trillion in revenue and serve five billion customers across 180 countries. We drive collaboration and collective problem-solving to maximize the business success of communication and digital service providers and their ecosystem of suppliers. We support our members, as they navigate their unique digital transformation journeys, by providing practical and proven assets and tools to accelerate execution, and by creating digital and physical platforms that facilitate collaborative problem solving and innovation. Learn more at www.tmforum.org.

Press Contact
Aisling Roberts/Anais Merlin
E: tmforum@ccgrouppr.com
T: +44 20 3824 9200

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