Decision-making in BSS/OSS transformation is not a simple topic, but that's exactly what Michael Irizarry, executive vice president of engineering and CTO of US Cellular, tackled Wednesday in the opening keynote of the B/OSS Live! show in Washington, D.C.
As someone who wears both the CTO and the CIO hats for the No. 5 wireless company (soon to be No. 4 if the AT&T Inc. and T-Mobile USA merger goes through), Irizarry has responsibility for all networks and cell sites, but also responsibility for IT and info services like billing and the other software-enablement systems. As such, a move in network plans necessitates his attention on the software side of the house, giving him a uniquely holistic view of operations.
New Market Realities
US Cellular, with 6.1 million customers, is facing the same issues other wireless carriers are: exponentially growing data and a need to expand capacity. Mostly a CDMA and EV-DO carrier, with some small GSM markets, the company has decided to roll out LTE this year, representing an acceleration of its plans, for a number of reasons.
One big reality that the cellco faces is an almost fully saturated market. US Cellular sees an under-2 percent churn in postpaid, and even prepaid churn is shrinking, Irizarry noted. Subscriber growth and revenue growth are largely from prepaid services, which tend to offer smaller margins, but a carrier can't afford to ignore that market or the data thirst within it.
And even as the pool of new postpaid wireless customers is shrinking, the switcher pool is shrinking as well. Taking customers from the competition is harder and harder.
The customer appetite for data services continues to expand, blowing past every three-month forecast that the company does. There's a need to have a rich portfolio of devices and apps that ride on top, but that means the speeds of the network need to increase. "Every time we open the pipe up, customers use it. We saw that 1X-to-EV-DO transition. We'll think we have plenty of capacity and spectrum, and it gets filled."
That thirst adds plenty of pressure on CAPEX and OPEX, to the point where "we just requested additional funding from the board to support data usage that is much higher than we planned on for 2011," Irizarry said.
Critical Software Needs
And so, while mulling the LTE upgrade and market realities, passing around the "executive level bong," as he put it ("I don't know what's in there but it's some good stuff"), the company also "decided to completely rip out and replace BSS systems, modernize the data center, upgrade call centers and modernize our Web presence to customers," he explained. "And I lost 50 pounds, and now have no hope of growing any hair. The good news is that I won’t be needing a barber."