Addressing Today's Market Drivers

Today, the telecommunications market is evolving faster than ever before. In this dynamic environment, Telcos face an ever-increasing number of challenges as they evolve their business to adapt to new market conditions. Some of the market dynamics we are seeing today include:

Telco Business Transformation & the Telco 2.0 Model

Telcos are facing a new type of competitive threat from Internet players, such as Skype and Google, offering "over the top" services such as "free" Voice over IP. In this environment, Telcos are at risk from becoming "dumb pipes", selling commodity flat-rate voice and bandwidth services and competing on price alone. To counter this threat, Telcos need to evolve their business model towards is widely being referred to as the "Telco 2.0" model.

Under the Telco 2.0 model, Telcos can leverage their network capabilities, such as mobility, messaging, location, presence, profile and call control, and combine these with internet-style services such as social networking, search, advertising, direct marketing and mapping, thereby enabling richer, more compelling and more personalised services than the Internet players can offer.

Furthermore, by exposing these capabilities in a secure, controlled and automated manner, Telcos can generate revenues from selling service enablers, as well as their own services, allowing them to fully exploit their network assets. The exposure of Telco network capabilities allows service "mash-ups" to be created by a broad community of application developers from the Internet world. These service mash-ups are often specialised, targeted services that appeal to the "long tail" of customers and will collectively generate more revenue at higher margins than the traditional narrow set of mass-market services.

Evolving Services towards the all-IP vision

Mass-market consumers and Enterprise customers alike are increasingly demanding rich, portable, personalised, access and device-independent services from their Telco Service Providers. They are no longer satisfied with the inflexible, pre-designed service bundles being offered to them: they want highly granular, "a la carte" service packages that are tailored to their needs as a user.

At the same time, convergence is now happening at all levels within the telecoms industry: service convergence across fixed and mobile networks, between circuit switched and IP networks, and also at the transport, access and device layers. This is driving the evolution of telecoms networks from voice-centric "legacy" technologies such as SS7 and IN towards data and multimedia-centric technologies based on IP, such SIP and IMS. Furthermore, networks are evolving from a closed, vertically integrated, network element-oriented architecture towards a more open, horizontally layered, service-oriented architecture. The upper layer of this architecture, the Service Layer, is independent of the underlying network platforms, and enables converged services across fixed, mobile and next-generation networks.

In addition, increased Telco consolidation is driving the need for a common service delivery framework across different operating entities / affiliates due to increasing complexity of networks that span regional boundaries and encompass a multitude of network platforms from different vendors.

Amidst all of this, Telcos are looking to control the pace of this evolution and ensure the investment they have made in current-generation services is protected as they evolve their networks towards the all-IP vision.

The need to maintain, and increase, profitability

The recent telecoms "bubble" brought the need for Telcos to dramatically improve their bottom line sharply into focus. Telcos today are facing margin pressures through more intense competition, ARPU erosion, customer churn and cost issues.

To address these challenges they need the ability to introduce attractive, profitable new services to subscribers with minimum time-to-revenue. At the same time they need to control costs: from an OPEX perspective, this means being much more efficient in how they develop, test and launch new services: and from a CAPEX perspective, it means reducing their dependence on the large Network Equipment Vendors that have historically locked them into service "silos" that can prove to be extremely expensive to onward develop to support new services.

Aepona addresses all of these market drivers directly

• Our Telecom Web Services solution provides the framework for exposing Telco capabilities to 3rd party application developers and Enterprises in a secure, controlled and automated manner.
• Our Service Evolution solution allows Telcos to evolve to the all-IP network vision at their own pace, whilst continuing to generate revenues from existing services
• Our Applications portfolio allows Telcos to launch profitable, customer loyalty-enhancing new services quickly and efficiently without locking themselves into single-vendor technologies