How to stay competitive in a digitally transforming world

Telecoms.com periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece Sacha Gera, SVP Cloud Products at Ribbon Communications, offers some digital transformation tips for CSPs.

Enterprise communications and collaboration are undergoing a major transformation. To a large extent, this is being driven by a new generation of customers, employees and partners who have grown up mobile first, cloud first and who are constantly connected. Enterprises and carriers who aren’t adapting fast enough to customer demands for new services and capabilities risk becoming less and less competitive.

Twilio has disrupted the world of enterprise communications, building a business valued at over $5 billion, based on its market capitalisation, and has recently turned in sequential quarters of growth by attracting large enterprise clients to their “Over-the-Top” (OTT) services, including communications (e.g. voice and messaging), content (e.g. TV and music) and cloud-based (e.g. compute and storage) offerings. While Communications Service Providers (CSPs) are in a unique position to own the next generation of real-time communications (RTC) delivered via software platforms, they have been slow to adopt technologies which are replacing their legacy services.

That said, there are solid options for CSPs who wish to compete against Twilio and others in the Communications Platform-as-a-Service (CPaaS) market. For example, the ability to add messaging to existing phone numbers and offer enterprise customers a “full stack” of software-driven communications services in addition to the underlying network infrastructure is available now.

Within weeks or months – not quarters or years – CSPs are capturing advanced communications services revenues that have been lost to the OTT players. The good news is that CSPs can tap into existing platforms to out-compete these new entrants. To remain competitive, however, CSPs must act quickly, and can do so with less time and risk by branding and marketing services that deliver greater reliability, fidelity and security on their infrastructure. These CSPs enjoy agility with software, administrative tools, security services, cloud-friendly technologies and more, which deliver better customer experiences (for their enterprise customer’s customers) at a lower overall cost.

While there are many options, choosing the right CPaaS provider is an important decision. As CSPs bring more OTT apps into the network, they need to fully understand how much money they will make on those services. Partnering with companies who do not compete with them is key to building business models that allow the CSPs to make money, while delivering new value to their embedded base.

Why roll out these services if they will not enhance revenue – and margins?

With traditional, transactional transport revenues under increasing price pressure, opting into a proven, pre-integrated set of CPaaS offering (including voice features such as call routing, text-to-speech, conference calls, messaging, multimedia messaging, enhancement of existing “phone numbers”, mobility services, security services and more) can lead to growth quickly, without heavy upfront capex.

New services can all be delivered by software via an application programming interface (API) – which is easier for the service providers, easier for the enterprises and more secure and sustainable than legacy solutions requiring equipment, maintenance and complex systems and contracts.

While CSP challengers are experiencing significant growth in sales and margins, APIs allow CSPs to also tap that revenue without having to “reinvent the wheel.” Furthermore, by leveraging APIs, a CSPs enterprise customers can also benefit in the following ways:

There is no turning back now. With the stunning successes of companies providing OTT messaging services and the disruptive impact companies like Twilio are having on CSPs and enterprises today, it’s imperative to rethink, redesign and roll out digital real-time communications services that are made better – and more secure – on carrier-grade network infrastructure. The public Internet cannot be trusted, but enhanced private enterprise networks and overlay services can be, and businesses and consumers will pay a premium for great service that is securely delivered.

Sacha Gera is Senior Vice President, Cloud Products at Ribbon, a 2015 CNBC Disruptor 50 and global leader in real-time communications software solutions. Often described as a change agent with a cross-enterprise approach to leadership, Mr. Gera takes passion in striking the optimal balance between innovation, growth, profitability and operational excellence. In his current role, he leads product management for the company’s portfolio of cloud solutions, including Kandy communications Platform as a Service, Over the Top Mobile Clients and Cloud Unified Communications. Prior to that, Mr. Gera was Vice President, Business Strategy and Operations. In that role, he led a number of functions including Services Product Management, Corporate Quality, Business Intelligence and Operations.