Follow the Money – How Use Cases Drive Innovation

Apr 7, 2014 by Prayson Pate

Overture CTO, Prayson Pate

I have previously written about how successful innovation is driven by three factors:

  • A customer problem or opportunity
  • Domain knowledge
  • Advances in technology

This blog will dig deeper into the first item: a customer problem or opportunity.  Why is that critical to innovation?  Because that’s what people will pay for.  Here we explore the two categories of real world use cases that represent important elements on any company’s balance sheet: saving money and making money.

 

One Side of the Opportunity – Saving Money

Overture is well into our transformation from a CE 2.0 equipment supplier to one that is helping communications service providers (CSPs) drive cost out of and drive speed into service creation, activation and assurance.  Customers and analysts were at first skeptical about this transition.  However, they quickly became engaged when they saw that we were focused on identifying, implementing and deploying solutions based on use cases that were important to the CSPs.

Some of these use cases are aimed at reducing OpEx and/or CapEx and are driven by the operations side of the house.  Examples of such use cases include:

  • Zero Touch Commissioning: Reducing or eliminating the time that technicians spend at customer sites by automating the configuration and turnup of CPE devices.
  • Flow-through Provisioning: Efficiently tying the network elements into the higher level systems to reduce the time and errors involved in activating a service.
  • Network Automation: This is the application of the principles of SDN and APIs to modernize the OSS/BSS systems for the CSPs.
  • Virtual Testhead: Providing an on-demand and pay-as-you-go capability to verify and troubleshoot services.

All of these use cases are valuable because they save time and money.  However, the money saved is sometimes dependent on removing or redirecting staff, and this takes time.  For that reason, the first two use cases above are interesting, but may not drive innovation.  The third (network automation) has big potential benefits but tangible and immediate costs.  The virtual testhead case is different. That one provides for immediate savings in CapEx (buying less equipment) and in OpEx (faster resolution of issues), which is driving a correspondingly higher level of interest.

 

The Other Side – Making Money

Other use cases are in the realm of driving more revenue, either by reducing the costs of existing services, or by creating net new services.  Some examples include:

  • Virtual Managed Enterprise: Managed services are a big business for CSPs, including managed routers, managed VPNs and managed security (firewall, IDS, IPS).  Today, each of these services is typically provided by a separate appliance deployed at the customer site, with a separate truck roll for each.  By applying Network Functions Virtualization (NFV) the CSP is able to support these services with virtualized functions running in standard x86 servers.
  • Bandwidth on Demand: Users can never get enough bandwidth, but they don’t want to pay for it when they aren’t using it.  Bandwidth on demand is a good way to dynamically acquire incremental bandwidth when needed.  It is also a great opportunity for the CSP to upsell the user.
  • Dynamic Private Cloud: A big barrier to the use of cloud services for mission-critical applications is the connection via the public internet.  Acquiring a private connection with guaranteed bandwidth and QoS is possible, but it is a slow and laborious process.  CSPs could offer the ability for the on-net customers to self-provision a private connection to a cloud provider – in minutes, rather than months.

In all of these cases there is an opportunity to apply innovations such as NFV to reap near-term benefits, but without having to boil the ocean in re-inventing the network architecture.

 

Getting Started

Our experience is that the best way to move forward with innovative technologies such as SDN, NFV, cloud and virtualization is to identify use cases that resonate financially with the customer. A plan that depends on overhauling everything for theoretical future benefits is a tough slog.  The other key is to quickly move from slideware to focused proofs of concept (PoCs) and then on to real trials.  The key to finishing any project is to start.

 

About the Author

Prayson Pate is Chief Technology Officer and SVP of R&D at Overture, where he is also a co-founder. Prayson is a technology leader and evangelist with a proven track record leading teams and delivering products. Since 1983 he has been building Carrier Ethernet and telecom products for service providers and network operators around the world - both as an individual developer and as a leader of development teams. Prayson spends much of his time driving adoption of Overture's new Ensemble Open Service Architecture, which includes aspects of automation, virtualization, SDN and NFV. He has a BSEE from Duke, an MSECE from NC State and is the holder of nine US patents.

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