The licensing model is also transformed, from the traditional upfront licensing fee to a per subscriber usage fee where everything is included – all infrastructure, all system upgrades. BSS-as-a-Service reduces infrastructure costs and avoids a piecemeal approach to complex legacy overhaul, while the pay-as-you-use commercial model enables the operator’s digital transformation costs to be directly aligned with service success.

So is it worth the risk? As one might expect, operators are generally conservative in their approach to major IT system upgrades. Most operators and service providers globally prefer to take a gradual approach, whereby one component is replaced at a time, such as a charging platform or CRM system. A step-by-step approach, combined with "digital overlays" is often the preferred way to upgrade telco IT systems.

In practice however, introducing one new part and integrating it with the rest of the old IT system can be quite complex and constraining. One of the dangers with the traditional approach to IT transformation is that the first 18 months can be spent rebuilding what already exists, but in the new environment. More radical approaches, such as a complete IT system overhaul, or adopting cloud-based BSS-as-a-Service (BSSaaS), can ultimately be more productive and efficient ways of upgrading BSS.

With a cloud-based approach, operators can be experimental, testing out overlays and greenfield approaches. But rather than taking successful cloud-based experiments back into the home IT environment, it’s time to take the in-house systems out to the cloud. In purely economic terms, it makes no sense for operators to own their own data centers in the future.

A cloud-based BSSaaS provides a low risk, highly cost-effective approach to providing a new transformational next generation BSS. Whether the operator plans to ultimately replace a legacy BSS, or run a cloud-based BSS alongside it, implementing cloud BSS provides a means to quickly launch and trial new services at greatly reduced cost and time to market. This strategy minimizes the risks, the costs, and the complexity. It reduces the risk of interruption to business and core revenues, and establishes a foundation for subsequent safe migration of the operator’s existing business at whatever pace is required.

Based on our experiences with our own customers, cloud BSS can lower the total cost of ownership by 35% compared to traditional BSS commercial models – and out-of-the-box set-up means it can be production-ready in as little as seven months.  Best-practice processes and capabilities mean 55% less manpower during system design and implementation, and the flexibility of configuration means new products and services can be launched to market without customization or change requests.

The business case for cloud deployment

Open partner interoperability immediately enables new digital business, IoT and Operator-as-a-Service models – while the SaaS approach means cost transparency, optimal resource management and lower budget commitment.

In our survey, 60% of operators believe that existing BSS platforms are not capable of supporting future telco business models, which further underlines the need for IT transformation. More than 80% believe BSS transformation is central to enabling telcos’ future business strategies, and more than 90% say that flexible BSS systems are critically important for delivering an optimal customer experience and delivering competitive differentiation. 

The need for change is clear, and a new approach must be taken in order to support this business transformation. While the telco industry is traditionally conservative, new options such as cloud-based BSS are becoming increasingly attractive as important agents of change for operators. Indeed, there is increasing confidence in the public cloud’s readiness for mission-critical telco IT applications and nearly all operators involved in the survey agree that the future of telco IT is in the cloud. 

Whether motivated by cost savings, IT infrastructure scalability or the streamlining of back office environments, operators recognize the advantages of cloud-based BSS. High levels of configurability enable business processes, offers and customer channels to be re-designed to enable a new approach to business. Cloud-based BSS will be a key enabler for operators to achieve competitive differentiation and deliver the best experience to their customers.