Key Takeaways and Observations from Digital Transformation World 2022

Like many other events, there was huge excitement for the return of the TM Forum’s flagship show, Digital Transformation World (#DTW2022) with its first outing in Copenhagen, having previously been in Nice. The organisers should be applauded for pulling together a well-thought-out event with plentiful opportunities for networking and collaboration (#tmfdigital).

Having spent considerable time in conference sessions and walking the show floor, it is apparent that there is a distinct lack of tech innovation, which is consistent with the other events I have attended in the last six months.

While telcos are making progress in transforming their networks, much more needs to be achieved to ensure they realise a long-time ambition of being agile and flexible. At the heart of the future network is ‘automation’ (a term widely used throughout the event). Again, whilst ‘automation’ is not necessarily new, it is central to a smarter and more intelligent network. Underpinning this approach are key functions such as the cloud and artificial intelligence (AI).

As the networks are currently undergoing profound change, this in effect requires a completely new mindset, culture and need for a new dedicated team within telcos. Repeatedly, speakers cited a skills shortage in the industry to help support this change, as attracting the right talent is becoming more difficult than ever; more so with the majority skewed towards men in the older age groups; a point reinforced by Keri Gilder, the CEO of Colt Technology Services, "We are facing a retirement cliff in our industry." Furthermore stating, "The great resignation is upon us."

This coupled with diversity and inclusion were major talking points at the show. To address this, the TM Forum has been collaborating tirelessly with partners to launch the first ever inclusion and diversity score. Widespread support and adoption will now be key to broader acceptance of this crucial initiative.

One of the standout companies at the show was Indian telco, Jio. The company recently celebrated its 6th birthday and is epitomising what a future telco should strive to be. Now boasting 421 million mobile customers and looking to replicate its success in the fixed line broadband market too. The move towards rolling out standalone #5G (by the end of 2023) will help fuel further growth in its core business and more importantly to explore new growth opportunities. This includes edge computing network slicing, and metaverse.

Underpinning this remarkable growth is the company’s platform architecture (Jio Platforms Limited (JPL); grown its workforce from 500 to 12,000 with an average age of 27 years. The Jio Platforms architecture has been built on a set of platforms with an end-to-end 5G stack which is fully cloud native and software defined.

Significantly it wants to take this winning formula (platform as products) abroad to other telcos through partnerships. This was big news at the show. The move raised eyebrows among telco vendors as underlined by Elisabetta Romano, the CEO of TIM subsidiary Sparkle who added, "Reliance is building products and they have done great.” This is a strong endorsement given that Romano previously worked in the vendor landscape. Therefore, all telcos should keep a watchful eye and explore partnership opportunities with Jio. Overall, this approach is akin to Rakuten Symphony and also NTT DOCOMO.

Collaboration continues to remain a buzz word on the show floor and further afield. The TM Forum was also keen to highlight the success of its Open API program. In fact, Jio has made use of these Open APIs to build its own platform as well as being one of the first telcos to make use of TM Forum's Open Digital Architecture. The breadth of these Open APIs were on the show floor with the majority of the 27 Catalyst projects utilizing them across wide ranging use cases. Some of these catalysts are still at an early phase of development.

Unsurprising to see the hyperscalers in force at the show. Over the last few years, they’ve forged closer ties with the telcos and are now clearly seen as key partners. In fact, Google Cloud was unveiled as a new forum member. Inevitably a cloud looms given regulatory concerns as underlined by recent moves at EU and national level to curb their dominance. The EU along with telcos is seeking ways to help with network rollout. While in the UK, Ofcom has opened up an investigation with the position that AWS, Google and Microsoft have collectively secured more than 80% of revenues in the public cloud landscape.

With the event being hosted in Denmark, it was only fitting to have the incumbent telco TDC NET (NetCo) along with Nuuday (ServCo subsidiary) on stage. The CEO of TDC NET, Andreas Pfisterer gave us a fascinating insight into delayering and successful surgical separation of the company. Deciding to do this on a voluntary basis rather than being forced upon by regulators. With this approach, the NetCo can solely focus on delivering connectivity services and infrastructure based upon leading edge technologies claimed Pfisterer and alluded to its 5G nationwide network as a proof point.

While CEO of Nuuday Jon James, uniquely highlighted the challenges facing all telcos as they pivot towards a digital services business. The company is underpinned by a legacy IT system that is cumbersome, costly and not fit for purpose for the new generation which needs to be customer first and able to bring novel services to market. Thanks to now being able to run OSS and BSS functionality in the public cloud (Microsoft Azure in this case) platform, it has entrusted Netcracker as its strategic partner for this as well as providing professional services.

The separation of network infrastructure from a services (consumer) business is a hot topic among telcos. There are currently a small number of telcos who have pursued this strategy including TDC.

While it is still early days to say it has been successful in Denmark, signs in other markets such as the Czech Republic and New Zealand suggest it is working and creating shareholder value. However, it is unclear whether the same positive impact will yield returns in bigger more developed markets.

#Sustainability featured prominently throughout the event. Even at the outset, the TM Forum took a structured approach and chose Copenhagen as it is one of the greenest cities in the world. All speakers and exhibitors are placing lots of focus on energy efficiency; reducing power consumption where possible, seeking alternative forms of energy; moving to 5G as quickly as possible, decommissioning legacy networks like 3G, relying more on AI and Machine Learning for network optimisation.

Messages such as the need to collaborate, flexibility and personalisation have been heavily discussed for years. Interestingly security was not widely debated at the event despite ongoing concerns and the increasing volume of #cyberattacks. The entire industry should address this issue and forge closer ties to find a common ground that all must adhere to. The entire value chain will be vulnerable to cyberattacks.

Overall, this year’s Digital Transformation World event has shown that telcos are slowly making progress in their respective journeys. Digital transformation remains the holy grail for telcos in driving efficiencies and unlocking any new revenue streams. The road ahead is still long, and success is not guaranteed. While at the same time the hyperscalers continue to strengthen their market position and are becoming more vertically integrated.