Publisher’s Letter: Top 10 New IP OSS Business Opportunities

Everyone knows Internet stocks and opportunities are hot. But outside our industry few are aware that OSS is even hotter. Over the last six months alone, OSS companies such as the likes of DSET, Micromuse, Vertel and more have more than quadrupled in value. So what opportunities are even better than the ones in the IP or OSS space? The answer: IP OSS opportunities. Here are my top 10 new business opportunities, followed by what they mean for the billing executives and their suppliers.

1) OSS for the DSLs .

In today’s Internet world there is no more glaring problem than getting DSLs from the ILECs and CLECs. Practically every major newspaper has written about the months of delay involved with service ordering and provisioning. So why is the DSL market in this state, and what’s the opportunity? The ILECs mistakenly believe the problem will go away when “DSL lite” arrives at your local computer store: the DSL modem is built into the PC, and all you have to do is plug the newly purchased PC into the phone jack, and you’re set up to go. While the ILECs are still waiting for this miracle solution, the data CLECs have been focusing on establishing collocation cages in key ILEC central offices. .

Now it’s time to move on. All carriers will soon realize that they cannot differentiate DSL service with hardware like an unbundled loop alone. Software and service will be the differentiator across the board in the telecommunications industry, and off-the-shelf OSS for DSL ordering and provisioning will be a winner for both ILECs and CLECs. .

2) Voice over DSL .

The voice-over-IP trade magazines go on and on about the advantages of IP telephony over circuit switching, particularly when the medium is DSL: self-service, or consumers adding new phones with unique telephone numbers as easy as plugging in a toaster; taking your phone from one location and plugging it in at any other location, and instantly receiving incoming calls, because the phone notifies your home VoIP server where you are; and so on. .

This all sounds like customer value, and it is. And it’s going to happen—but not before an IP OSS solution is in place. This brave new world of self-service provisioning will require OSS mediation between legacy databases and systems such as SOA/LNP, PIC/CARE, LIDB/CNAM and of course E911. .

3) Integrated Access .

One of the key benefits of VoIP is that you can multiplex voice and IP data packets over the same medium, creating both cost savings and bandwidth on demand via integrated access. .

This all sounds good—and it is, except for voice QoS. In the IP world today, there’s no such thing as selective degradation of a particular service. All IP traffic, both voice and data, is affected at times of congestion. Consumers, particularly business customers, will not tolerate variable voice quality during a call in progress. For IP integrated access to work successfully, it will require a new-generation, dynamic, real-time OSS for bandwidth inventory and network management. .

4) Internet Appliances .

Today’s telecommunications network and OSS infrastructures were built around people-to-people communications—voice, fax, e-mail, and so on. Add machines, and things get complicated. People-to-machine communication (e.g., data entry into a remote computer) doesn’t cause many hiccups. But machine-to-people communication begins to cause a mess—for example, a fiber cut in a network, and the resulting flare of alarms that must be addressed in the end by people. .

As we move into the new Internet era, where machines will be communicating with other machines, the OSSs will be challenged as never before. An IP-ready toaster cannot talk to a customer service rep to order access. In short, in a world where machines communicate with other machines, the entire concept of the IP 3 A’s—authentication, authorization and accounting—has to be revised, along with the IP OSSs. .

5) IPv6 OSSs .

IPv4 has limitations. Among them is the address space (32 bits only yields 4 billion addresses). IPv6 would solve the address problem and more, by making 64 bits available for addressing 4 billion times 4 billion devices. The problem today is that almost every one of the million routers in the IP space would ignore (drop) IPv6 packets. .

IPv6 would be dead on arrival if it weren’t for the other new stuff requiring billions of new addresses and service differentiation marks like IP appliances. Consumers are not going to program an IP address into their toasters, cars, pet collars, etc. Who would want to spend their leisure time at home programming appliances and acting as a LAN administrator? .

So the likely fallout is that you will first see IPv6 arrive via addresses burnt into the chips of IP appliances. How will the IPv4 and IPv6 worlds coexist? There will be emerging IPv6 carriers, with interconnection points into today’s IPv4 networks—and, of course, a new IPv6 OSS infrastructure. .

6) Outsourcing IP Event Processing .

Today’s ISPs offer consumers all they can eat for $19.95 a month, flat-rate. Not only does this simplify IP billing, but the number of IP events generated per user is relatively low. You log in, browse a Web site or look at your e-mail. An ISP with 100,000 customers only has to process several login/logout messages or e-mail session per second. .

Now comes the new Internet, with complicated user activities—video streaming, real-time rating, complex QoS-based pricing, session authorization and more—not to mention Internet appliance traffic and the next generation of Internet hackers. .

So what’s the point, and what are the IP OSS opportunities? Today’s ISPs, with 100,000 subscribers, process on the order of 10 or so user events per second. The next-generation ISPs with the same customer base will have to process perhaps thousands of events per second. The complexity and rapid scalability requirements will beg for an IP event processing service bureau to handle IP OSS. .

7) Element Management Agents with Customer ID Information .

One of the most complex problems in managing data networks today is that when you have a network failure, you cannot relate the impact very well to the particular customers affected. .

The benefits of IP networking are that not only does the OSS ride on the same platform (IP) as the network elements, but also that IP addresses, at least for corporate users, have global significance. So, along with the next generation of IP network comes the OSS opportunities for user information associated with network elements, via new-generation IP element manager interfaces containing user ID information. .

8) IPDR and Network Management .

We are strong advocates of the IP detail record (IPDR) working group initiative calling for a standard record for IP billing. Because of massive billing vendor and carrier support, it looks like the standard will soon become a reality. .

The IP OSS opportunity beyond billing lies in the fact that the IPDR format can be made flexible enough to carry other network information in addition to billing records, such as network management information. Remember that SS7 was created for the circuit-switched world to carry call setup signaling between switches, and to access central databases for intelligent network services like 800, calling cards, etc.—and now SS7 networks are being used to transport short, two-way paging messages in the wireless world, fraud control and even billing. .

The same evolution can happen in IP. Bottom line: if IP carriers have to create an internal network to transport IPDR messages in support of IP billing, that network can also be used to support other IP OSS requirements, such as service and network management. .

9) Mediation Devices for Legacy OSSs .

There are a dozen and one IP OSS vendors that can provide off-the-shelf Web portal software and mediation devices to IP OSSs, for users as well as the IP carrier itself. But few if any IP OSS vendors seem to be able to provide the same Web portal view to legacy OSSs. .

Put simply, a carrier would like to let its corporate customers or carrier partners look at but not touch the data or their legacy OSS systems for order tracking, monitoring trouble tickets, etc., for the old stuff like ATM and frame relay service. .

10) OSS for ASPs .

The No. 1 desire today of IP network service providers regarding value added services is to become application service providers. An ASP is a third-party provider of an IT application to multiple customers via an IP WAN in exchange for payment. The barrier to entry is that you have to have the IT skill set (people) and the experience to make it happen. Putting 1 and 1 together, you get the following for carriers: The only unique IT skill set they have is in OSS, and every new IP carrier is going to need IP OSS. So you arrive at the conclusion that if as a carrier you develop an outstanding IP OSS infrastructure, then you become an IP OSS ASP to other carriers. .

These are my top 10 new IP OSS business opportunities. So what about the new billing opportunities? The bad news is as usual: The bucks for billing systems and upgrades usually become available to the tier 1 and tier 2 players only after dollars are spent for the other OSSs. The good news: billing opportunities will be created requiring even bigger bucks. So while 1999 may have been the year of skyrocketing OSS stocks, 2000 could be the year for skyrocketing billing companies, particularly for those with IP billing and/or IP OSS products. .