Values and differentiation in cloud market

A recent industry discussion paper from Ericsson, The Telecom Cloud Opportunity, provides insights into the unique cloud service opportunity telecommunications operators hold, which will substantially differentiate them from sector competitors and other cloud providers. "At a time when telecom operators across the region are looking to differentiate themselves and looking for new revenue streams, cloud services offer growing and largely untapped potential." Ericsson strategic marketing manager Warren Chaisatien says. The exponential growth of mobile technology supports this cloud opportunity both in the enterprise and consumer space. An Ericsson business user study shows 78 percent of the respondents say they work more efficiently when they have access to mobile broadband and 92 percent say they need access to mobile broadband everywhere. "Operators are in a unique position to utilize their expertise in managed services and take advantage of network features to enhance cloud offerings for users." The paper identifies three areas of opportunity for operators to shift from selling communications to servicing on-demand ICT capabilities. Telecom operators can add considerable value in the management of cloud connectivity, delivering cloud-based capabilities and leveraging network assets to enrich cloud offerings. "Telecom operators can move beyond simply being the conduit for over-the-top (OTT) players and position themselves to capitalize on cloud services – both as providers and adopters of the technology." One example is for telecom operators to offer prioritized or guaranteed services – instead of best effort - on selected OTT cloud applications, leading to new revenue streams. In the enterprise space, telecom operators can not only benefit from the use of cloud services to gain efficiencies in their internal operations, they can also partner with cloud providers to commercialize those applications. In this way, they can open up new opportunities in traditional markets such as outsourced billing, as well as emerging segments like cloud-based machine-to-machine platforms for vertical industries. An increasing number of telecom operators are already recognizing this opportunity as evidenced by their morphing strategies and growing investments. Ericsson projects that that global investments in cloud services will more than double from an estimated US$55 billion in 2011 to almost US$170 billion by 2015. Operators will not be able to address all of this market, but they are poised to take a significant share. "Now is the time for telecom operators to leverage their unique advantages and ensure their networks, business processes, support systems and organisational structure are optimized to facilitate the proliferation and consumption of cloud services," Chaisatien says.