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4 Fictions About Developing Virtualized Managed Services

by liza.adams ‎02-08-2017 06:08 AM - edited ‎02-08-2017 09:05 AM (8,090 Views)

Today, vCPE (Virtual Customer Premises Equipment), SD-WAN (Software Defined-Wide Area Network), software-defined security and cloud managed WiFi promise big things to customers:

  • Innovative and personalized services
  • Better user experience
  • Faster service delivery
  • More cost-effective offerings

It seems logical that because of these technologies, it should be much easier for CSPs (Communication Service Providers) to develop and take cloud-based or virtualized managed services to market.


They also make providing incremental services faster and easier, simplify and automate operations, offer better visibility and analytics, and more. Although technology and ecosystems have a big role in fulfilling the promises, go-to-market (GTM) approaches have an equally big role. It's time to put the GTM speed bumps in the forefront as more services are developed and launched.


Here are four GTM fictions that CSPs and their vendor and integrator partners should think about.


Fiction 1.  Keep the Power

Traditional thinking puts control and data in the hands of the CSP and its partners to manage and ensure the best service performance. This was necessary when assurance was dependent on someone manually configuring and managing the infrastructure plus piecing together multiple views and reports to gain full visibility of everything happening in the network across all customers. With today’s network intelligence and automation, it’s time to shift power to the enterprise customer without having to worry about any one customer negatively impacting its network and others. This is similar to what Amazon AWS, Microsoft Azure, Google Cloud Platform, and others have done for compute, storage and network services.


More enterprises want direct control to make things happen when they want it to happen; hence, the idea behind self-service portals. They also want the data, analytics, and recommendations for what they need to do or change next. The CSP can provide analytics that reflects the need to increase bandwidth, add or reconfigure access points, enable load balancing, and improve the security posture by activating DDoS mitigation services. What a great upsell/cross-sell opportunity for the CSPs. Everyone benefits from that shift of control and data to the customer.


Fiction 2.  Better Safe than Sorry

SLAs (Service Level Agreements) have long needed a swift kick. With technology innovations, we’ve lost our excuse to not kick ourselves into gear. SLAs have been backstops - safe but toothless. It’s bean counting on availability, latency, packet loss, jitter, and other complicated and less relevant parameters to customers. If we fall short on the beans, the customer gets back -- you guessed it -- beans. CSPs and the industry as a whole have the opportunity to be bold with SLAs given all the smarts in the network today. Again, customers are more interested in outcomes and experience. Dare to offer a service satisfaction guarantee?


Virtela (now part of NTT Com) was ahead of its time when it launched a cloud-based application acceleration service with a service satisfaction guarantee in 2010. If the customer doesn't “feel” that their applications are running faster, they don’t pay. Instead, the customer gets paid 250% of the service charge and Virtela deactivates the service. No reports necessary to prove that it wasn’t faster. No questions asked. Imagine what happened when the service was deactivated. You think there might have been groups collaborating in real-time around the world who would’ve noticed that the apps are now running slower and screamed? That’s exactly what happened and service was restored. It was bold but the risks to the CSP were low.


Fiction 3. Load It Up Like a Baked Potato

Oh, how we love to load it up! Every possible topping. Every possible bell, whistle, or combo ... multiple VNFs (Virtualized Network Functions); three classes of service; five flavors of security; on-demand, scheduled, always on; full service and ala carte; complementary options; pricing bundles plus some pricing that’s off the grid; and if it’s not on the standard list, we’ll customize something for you. It’s like ordering from a 35-page Chinese menu starting with A and ending with ZZZ (yes, the customer has fallen asleep).


This is often a symptom of not knowing exactly who we’re targeting and what that target segment wants. We describe what we have rather than what we solve and we throw everything at our customers. We hope, not only that something makes sense for them, but that they have put in the thought we didn’t and can tell us how our service can help them. This may seem intuitive to us as technologists, but in a digital world, this feature-oriented GTM approach negates the agility enabled by technology innovations.


Fiction 4. It’s All or Nothing

vCPE or CPE? SD-WAN or MPLS? Cannibalize or not cannibalize? These are tough questions when we put them that way. But it doesn’t have to be all or nothing. Change is tough but what makes change easier is when we can ease into it. We need to strike the balance between showing the customer the value of the new offerings and mitigating customer concerns in adopting new technologies. For example, why not give customers the flexibility to choose between cloud and premises offerings based on their applications, resources, and traffic? Or, better yet, package these options into services designed for specific use cases described by business value. Allow customers to mix and match and provide seamless interoperability between different implementations on the same network. We’ve then changed the conversation from cannibalization to co-existence. This approach also gives enterprises a way to try new technologies in smaller or less critical locations and deploy more over time, change back, or do something else. It’s a win-win for enterprises and CSPs.

The customers shouldn’t have to choose the best technologies and implementations because the service would be designed for specific applications and inherently use the best networking technologies. Think user outcomes and experience. Think vertical-, application-, location-, and user-based services like the ones described in my article on B2Me Managed Services with service offering ideas. However, in situations where the underlying technologies are relevant to the customer, offering some degree of choice and allowing for migrations make sense.


We can always refer to situations where these fictions have kernels of truths. But the takeaway is that we must challenge these fictions as most of the underlying factors from which they have sprung have disappeared. To change and compete in the new world of digital business, CSPs need to quickly unlearn old thinking and design services that take full advantage of what the network is capable of doing today. The network has become a platform for business innovation. There are customer expectations around agility, simplicity, and user-centricity that come with that. GTM must likewise evolve to match those expectations so as not to delay adoption.


I would love to hear your thoughts and other ideas for accelerating the adoption of virtualized managed services.