Wholesale telecoms used to be all about routes and reliability. Today, those are baseline requirements for any wholesale provider, essential foundations for more advanced services. The wholesale market has moved on, and the focus now is on engaging partners to deliver excellent experiences to end users. Co-sponsored feature: Telus
Brent Allison: It's about what you can do to help your partners grow
Convergence of technologies and industry participants has increased the pace of innovation. Go-it-alone strategies are not sustainable, thus collaborative partnerships are on the rise. The complexity of those relationships goes way beyond speeds and feeds and places the wholesale provider ever closer to its partner’s customers. Providers are now judged on their capability to support retail services and the range of experiences they can deliver to their partner’s customer.
“If you look at wholesale as an enabler of retail markets, it has become more important,” says Brent Allison, Telus vice-president of Service Provider and International Markets, “The mandate shifts from one of managing a few types of vendors and a few types of customers, to one involving many players flowing through to support a huge range of services. Partners now want access to our capabilities in a variety of ways – more of an open context. ”
In fact, Allison maintains that wholesale is more important than ever to a telecommunications provider – able to create new revenue streams for both itself, and its partners. So, while the past focus of selling excess capacity on long-haul pipes remains part of the business, today’s wholesale team is more focused on collaborating with their clients to extend the power and capability of interconnected ecosystems to deliver improved experiences for all types of retail customers. Within TELUS itself, the focus and role of the wholesale team has shifted to align with the broader objectives of the chief marketing officer.
“We’re saying, ‘here are some new options that are not necessarily about speed or quality, but about the experience’,” adds Allison. “We have the ability to support our partners who want to use to reach their customers in a different way. The things we’ve traditionally done as a wholesale provider are now being clamoured for by a wider range of service providers and potential partners. In fact the definition of a wholesale customer has changed dramatically over the years to include application providers, media companies, online game producers, aggregators and content delivery networkers. It’s not about connections and speeds – they’re table stakes, it’s about what you can do to help your partners grow.”
Telus has been at the forefront of the OneAPI initiative, which saw Canada become the first country to provide open APIs (Application Program Interfaces) nationwide across its domestic operators – an aggregated base of 22 million wireless subscribers. In fact, this publication awarded Telus the 2010 GTB Innovation Award for Mobile Applications Innovation as the principal telecom company leading the GSM Association’s OneAPI pilot project. This project has reached its commercial phase and will expand to Europe and Asia in the near future. Opening the networks to third party application, content and service developers sends a powerful message to the industry and heralds the emergence of a new model within telecoms. For Allison, that’s a critical part of the proposition but just one of several key ingredients.
“We become more than just a connection or even an API provider,” he explains. “We can support what’s very important to our partners and their customers.”
In his view, when it comes to non-traditional players, there are four key attributes that partners are seeking out from wholesale providers; they are looking for a confidential relationship because, while the wholesale proposition is core to their business, they may be competing with the wholesaler on a retail basis; they need the baseline networking expertise that wholesale teams can deliver; they want an open and non-discriminatory environment in which to operate and provide their services and; they need a standardized ability to bridge with other carriers. Finally, “they need a consistent global experience for their customers. It has to work just as well around the world as it does on Telus,” he says.
In the old wholesale environment, there was little scope for providers to differentiate. If you had the right bandwidth on the right routes your means of differentiation came down to price and customer service. However, the increased complexity of the new wholesale environment allows for far greater disparity between providers in terms of the services they can deliver to their partners and the models by which these are provided.
“We have a track record of investing in wholesale-specific capabilities,” says Allison. “A lot of others haven’t. We’ve brought IP-VPN, Enhanced Directory Assistance, Ethernet, and VoIP interconnect to market. We’re a leader in those markets and are collaborating on new business models with existing and new partners.”
Allison identifies five key emerging areas where Telus is active: wholesale access to API’s that provide billing, presence, session-initiation, and more; white-label retail services such as Hosted Unified Communications; flexible billing and mediation capabilities to support a broad range of business models; multi-media enablement such as Content Delivery Networks; and integrated customer experience programs leveraging Contact Centre Outsourcing, inclusive of web, chat, and live agents. Recent awards as the BPO Employer of the Year by ICT Philippines and being named the top North American Directory Assistance provider by Paisley Group, underscore TELUS’ commitment and execution in moving to support the new wholesale services environment.
“By forging innovative relationships in emerging markets,” comments Allison, “we decrease risk, capex, and time to market for our partners and Telus.”
Wholesale services are becoming increasingly entrenched for many retail service providers and that brings a number of issues into the spotlight. For instance, to what extent should wholesale providers assume the responsibility for the delivery of specific services? For Allison, there are myriad approach for myriad services and applications.
“It comes down to the application itself and goes back to the intelligent middle layer,” he says. “The capabilities of that intelligent network’s middle layer dictate how wholesale providers can engage. Other organisations are operating intelligent networks, except their systems are often closed. From a wholesale perspective that functionality has got to be flexible enough to work across a variety of entities in a way that is open and useful for all parties.”
Allison also points out that there remains a vast wholesale business that operators continue to guard closely.
“The market is moving to the new wholesale arena,” he says, “but it is not going to replace traditional revenues overnight. Instead, that will occur over time.”
That said, many of the skills and attributes associated with the provision of traditional wholesale connectivity translate through to the new wholesale arena. Partners are looking for trustworthy wholesale providers that can demonstrate healthy balance sheets, robust investment plans, an appetite to adopt new, agile ways of delivering service and a willingness to be flexible in terms of how contracts are constructed. Allison acknowledges that much comfort comes from Telus’ heritage in the wholesale market.
“Many of our best attributes arise from the services we have traditionally delivered,” he says. “We have the wholesale confidence built up on our wholesale routes and we will support more activity because of that. In addition, we’re a totally stable, US$9bn company and we have cash flow growth. People like that – we’re not going anywhere.”
New partnerships will consequently emerge as new entrants seek to innovate while banding together with those with the experience, reputation and financial strength.
“Today there are almost no barriers to entry so trust and financial strength are important;” says Allison. “But, when you consider the top 30 telecoms organisations, we are all financially stable. To really differentiate, you must have the ability to bridge the trust in a relationship and emphasise how, as an established player, you enable them to win more business using your reach for the trusted global extension of their local offering.”
Allison ads this new flexibility is opening doors for partnerships between the traditional large players and smaller outfits. “Historically there have been a few big entities involved in wholesale and a big chunk of revenues, maybe 80%, comes from 20% of customers,” he says. “But, when you look at the transformation occurring, it becomes clear that new partners are bringing thousands of customers all of which are generating revenues.”
Telus is looking for ways to engage in a variety of models to support these new types of business. “A potential partner might be looking for a provider who can move quickly, or one who has paperless billing or perhaps even no contract,” explains Allison. “There’s also an expectation on the part of end customers that technology is on a six month cycle so they are looking to keep their options open and are less willing to commit full time on an entire ecosystem. Our role is to come up with relevant propositions to meet those needs from the perspective of their providers.”
It’s clear from Telus’ strategic approach to wholesale that its role within the company is recognised as transformational and, with the business now more tightly integrated with retail teams and the marketing organisation, it is set to maximise on the new revenue opportunities presented by the new wholesale value chain. Their network – and the intelligence within it - underpins the services that can be supported but it is the attitude to partnerships coupled with a new openness and the willingness to engage on flexible terms that truly unlocks the potential of the wholesale business. GTB