Meeting at Ericsson
While recently in Sweden I enjoyed a day with Ericsson, an important part of which was spent acquiring a better understanding of IMS.
This was accomplished via a number of discussions and demonstrations. I always find Ericsson very responsive to my preference for in-depth discussions with their key experts, rather than powerpoint presentations.
As many of my colleagues will know, spending an hour or so with broadband guru Martin Harriman is always invigorating.
But back to IMS …..
The role of IMS
First of all, it is important to place IMS within the context of other developments, such as NGN and FttH.
NGN, FttH and IMS
- NGN is a concept that addresses the access and integration of core systems – from billing to network management and from mobile to fixed.
- FttH addresses the user access to these systems and, through them, to the many applications and services.
- IMS is a technology standard that organises all of the applications stored within the NGN systems.
IMS allows telcos to offer the users the same or probably a better user experience than they currently get from the new media companies through web-based systems.
Managing the digital media
While one could argue that IP alone can also create such an environment it could be in the interest of the telcos to themselves develop a network that could provide such an experience. This would most certainly have added value, and it would also enable them to offer these ‘application organisation’ services to the content and service providers. As an IP machine IMS offers a framework for global IP applications, interoperability and access to mass markets, while the alternative doesn’t deliver that framework.
With their national and international reach telcos can create much larger networks than the new media companies. However, the longer they wait to generate their NGN-IMS-FttH strategies the more market share they will give away to the new media companies.
In the past, the incumbent companies could afford to allow these newcomers get a foothold in the market, and just buy them up later, but this is no longer an easy option. Telcos can no longer buy up companies willy-nilly – some simply can’t afford this anymore, and some of the newcomers have grown to such levels that they could easily gobble up a few telcos if they wanted to.
Key tool for telcos
The interoperability of applications over the various networks is a very powerful tool for telcos in their battle to maintain their position in the market. Yet they have been slow to seize this opportunity; to date no more than half a dozen of them are seriously involved, while, as usual, the others have test beds and pilots but very little action.
Yet the companies that have implemented IMS are also the leaders in securing their share of the application management market. They include Telefonica, Sprint, Swisscom and Softbank. The key reason has been that IMS delivers good cost savings, and this is the first thing that telcos need to realise if they wish to compete with the Internet media companies.
While each implementation is very different, as I have said on other occasions, an average of 30% cost saving is the minimum a telco should aim for when looking at IMS. Once that is in place telcos can move on and use IMS to improve the customer experience through multimedia, and to expand their revenue base through new applications, clever billing and packaging options.
From mobile to fixed networks
Interestingly, although IMS was first seen as a major tool for mobile operators it has been the fixed operators who have taken the lead. Mobile operators are even further behind in embracing the brave new world of applications – their efforts to date have mainly been aimed at protecting their extremely lucrative mobile phone business
It will be impossible to replicate that level of profitability in any other part of the telco industry and they will try for as long as possible to milk the current market before moving more seriously into other applications.
NGN would be the ideal system for IMS to operate on, but it also works on the existing environment. It can link broadcasting, PCs/Internet, 2G and 3G systems.
IMS tool for new business models
Of course, new IMS business models will, like the Internet, have to look at advertising and permission-based models. But, here also, there is now enough evidence that these are becoming sustainable business models. Furthermore, based on their national and interactive operability, telcos’ networks will have clear advantages that they could exploit, both for content providers and advertisers.
While the opportunities are endless I did pick up on a few applications that might not be well-known at this stage, such as:
- A service that allows remote parental control. Services are controlled via the TV set-top box, but a child can ask parental permission to watch content that is blocked and the parent can, via the mobile phone, provide (or not) the requested permission
- In healthcare, an SMS or message can be sent to a patient to double-check that they have taken their medication.
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