Maximizing Profitability with Agile Services and an API Economy

With the massive investment required for building a new network, it’s natural to wonder whether providers will see a ROI with a services-driven approach. Looking at the bigger picture of how a services-driven network works, we can see the value in taking this approach. By focusing on frequent but calculated changes to the network, services-driven networks help increase application performance while supporting the rapid rollout of business applications and services. With better performance comes greater customer satisfaction, translating to long-lasting customer relationships. And, of course, faster deployment of new revenue-generating services translates to faster time to market and bigger bottom lines over time.

Beyond these cause-and-effect outcomes, the transition to a 5G world—one of the driving factors necessitating an agile network for its ability to seamlessly transport data from billions of connected devices—presents a huge revenue generation opportunity for service providers in the form of the API economy. 5G and associated Internet of Things (IoT) will usher in services such as massive machine type communications in smart buildings, city systems, power grids, digital health, and autonomous vehicles. These services will generate massive amounts of data on a consistent basis, which carriers will be able to monetize through application programming interfaces (APIs)—a software intermediary that allows applications to communicate with each other.

This concept is not a new one. OTTs worldwide make massive use of APIs, including Netflix, Google, and Uber. Uber drivers, for example, know where the ride requestor is located through the use of APIs, which pull location information from Google Maps’ API.

Telecom providers can benefit from an API economy by exposing their services and infrastructure through APIs to create new revenue streams. They can integrate their services with other platforms, such as e-commerce, healthcare, transportation, and more. This collaboration can lead to new business opportunities, increased customer base, and enhanced market reach.

In addition, telecom providers generate vast amounts of informative data from customer interactions, network traffic, and IoT devices. By exposing APIs that provide access to anonymized and aggregated data, they can monetize this data by offering it to third-party developers, advertisers, or other businesses. This can create additional revenue streams and leverage the value of the data they possess.

Finally, based on their centralized position, telecom providers are in an ideal position to serve as API integrators. They can aggregate data from various API providers and, in turn, provide information in standardized form for analytics, security and Blockchain to application developers.

Taking the Plunge

Despite the competitive need for and huge revenue potential of agile service network transformation, many operators are reluctant to invest in the architecture required to make it a reality. While re-engineering networks is a challenging and expensive endeavor, providers who offer services with varying bandwidth, latency, and availability guarantees will be rewarded with the ability to quickly deliver new revenue-generating services and business models.

Whether focusing on connectivity services or leading the charge to the API economy, the key to commercial success will be to move fast. By dynamically mapping service intentions to the required network capabilities, agility helps service providers focus more on providing a stellar experience, adding new services, and moving up the value chain, and less on the technology behind these benefits. But the market won’t wait; providers should use this time now to define their goals for the post-5G world and plan their network transformation for the greatest business success.