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Organizational challenges of the convergence era

Vikas Bajaj
Wednesday, October 31, 2007
Vikas Bajaj
The silent telecom revolution
The telecom industry today is going through a silent revolution and telecom networks are undergoing a sea change. Convergence is the new mantra driving this transformation. Transport is becoming Internet Protocol (IP) based end to end. The advent of the IP Multimedia Subsystem (IMS) is causing the telecommunication network’s core switching infrastructure to become access agnostic. Telecom applications are becoming agnostic to the type of device used by the end user. The net result is a telecom network that is no longer a wireless network, no longer a fixed line telephony network, no longer a broadband internet network, and no longer a VoIP telephony network. It is metamorphosing into a Converged Network that offers the same set of services to the end user irrespective of the type of connectivity the user has or the type of device that he uses. Not only that, it also promises continuity of service through the support of ‘Fixed Mobile Convergence’, even as the user becomes ‘mobile’, away from the comforts of his home.

Given the significant transformation that convergence is bringing to modern day telecom networks, it is appropriate to classify it as a ‘disruptive technology’. Yet, it is a silent revolution. Unlike the advent of the mobile technology which released the end user and his device from the tethers of the wire, there is no perceptible impact to the end user at this point of time due to convergence. Of course, the impact will be visible in due course of time. But, for now at least, the end user is unaware of the huge investments operators around the world are pumping in to adopting this new mantra. Hence, it is a silent revolution.

Key challenges
It is indeed remarkable that this technology-driven transformation is happening. However, innovation alone is not adequate to ensure the success of a new technology. Operational excellence and business excellence have to go hand in hand with the deployment of a new technology to ensure its success. Besides several other aspects, organizational structures play a key role in ensuring the success of a business. So, the key question here is whether telecom organizations are equipped to reap the benefits of the convergence technology revolution. Are their existing organizational structures well-equipped to address the challenges brought about by Convergence Technology, or is there a need for change? Here, telecom organizations include all elements of the value chain beginning with the Silicon vendor and including the software or middleware vendor, the Original Design Manufacturer (ODM), the Original Equipment Manufacturer (OEM), and finally the Service Provider who actually delivers telecom services to the end user.

Typically, telecom organizations today are organized as verticals centered on the type of service the network provides. Thus, there is likely to be a wireless division that addresses business related to 2G and 3G wireless networks, there is likely to be a broadband division that addresses business related to broadband data access, and then there is likely to be a fixed line telephony division that addresses the business related to fixed line telephony. If newer technologies such as IPTV are part of the portfolio, there is likely to be an IPTV division. Of course, within each of these divisions there is the likelihood of subdivisions that are based on customer segmentation into the enterprise user and the consumer user but broadly, this is the kind of verticalization one would expect in an organization.

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