Programmable Telecoms: What is in IT for Telcos? by Sebastian Schumann

Programmable Telecoms – What is in IT for Telcos? by Sebastian Schumann, Technology & Innovation at Deutsche Telekom

Sebastian’s presentation does a great job of bridging the thinking across the traditional telco world, and the CPaaS world (or CXTech world).

He explains the NT (Network Technology) / IT (Information Technology) view within telcos, where IT supports NT. While CPaaS providers take a software company approach. From which he compares them, noting both are beholden to telecom regulations and CPaaS must pay the telcos for wholesale termination.

There’s an interesting analysis on the 60% mark-up on wholesale rates Twilio is able to charge for an SMS with a simple value add of Verify (2FA). And for voice the mark-up is even great at close to 300%. CPaaS is delivering on many of the “digital transformation’ objectives in automation, lowering costs of operations and focusing on customer experience. Note Deutsche Telekom’s wholesale voice revenues are not that different to Twilio’s revenues.

So it’s actually a model to follow, CPaaS is creating a TELECOMMUNICATIONS SUPPORT SYSTEM. Enabling business-process supporting communications enablers that are produced with a modern IT infrastructure and paradigms that can be integrated almost anywhere.  This is a critical point Sebastian is making, CPaaS is the future of telecoms (in wholesale at least).

I really like this diagram in the evolution from the classic NT view of the world, to a customer experience led view. From the Programmable Telecoms Innovator interviews, a common message is know your customer.  Treat telecoms like “yet another IT application”, it all depends on how good the abstraction is, how integrated the experience, and how good the ecosystem.

NT to Experience

To wrap up Sebastian reviewed the successes and challenges Asia faces in CPaaS / CXTech.

  • IdeaMart (Sri Lanka) is the most successful Telco CPaaS globally
    • Revenue contribution greater than any other VAS, close to double digit % revenue contribution to the business
    • Performance of late is relatively flat, as it struggled to move beyond messaging
    • Bottom-line: Asian Telcos can be successful in CPaaS, this is not a western phenomenon
  • Keys to IdeaMart’s success:
    • Treated messaging like “yet another IT application”, abstractions to simple web forms any small business owner could use, developed a vibrant ecosystem
      throughout Sri Lanka solving local problems that mattered to Sri Lanka
    • Largest TADHack Global location for many years
    • Customers in Sri Lanka would choose their telco based on whether they supported IdeaMart
  • In the Analysis Alan will present on the CXTech Landscape, Asia is under-represented in CPaaS. Twilio, Vonage, Sinch, Telnyx, 8X8, Plivo, Amazon, Voxbone, MessageBird, Voyant, etc. are all Western companies. Where are the Asian Champions?
  • There’s a multi-billion dollar revenue gap for CPaaS in Asia
  • Asian Telcos can close this gap – the keys are: treat telecoms like “yet another IT application”, it all depends on how good the abstraction is, how integrated the experience, and how good the ecosystem. Perhaps we have a new acronym, yaita (pronounced yeah-ta)?

We’ll be following up Sebastian and Marten’s presentations with a panel discussion on the Universal Telecom API and its role in Asia.

You can contact Sebastian here.