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On the Fence about Telecommunications as a Service (TaaS)? It Might be Time to be Bold.

Are the concerns around TaaS real impediments to adopting the model or just a new set of reasons to stay on the fence?

When it comes to TaaS adoption, it seems the market remains split, with some for, some against, and the rest sitting on the fence waiting to see more results before taking the leap. Everyone seems to agree that TaaS makes sense, but the perceived roadblocks for moving to TaaS are changing now that there’s greater uptake of as-a- Service offerings in general.

Of course, you still hear about the old concerns – control, privacy and security – but new barriers to adoption are being discussed, including difficulties around commercial model comparison, product maturity, supplier performance and time taken to see a return.

So, are we wrestling with overcoming real problems or are these perceived deterrents just a new set of reasons to stay on the fence?

Are we comparing apples with apples?

The big question many organisations struggle to answer is – can I compare price or value when looking to move telecommunications from on-premise to the cloud?

Simply put, no. The differing commercial models make direct price or value comparison difficult as there are so many variables to consider.

For example if you own your kit, you may be working to a network asset refresh plan of 10 years – or even longer if you’re prepared to take that risk. A lot can happen in that time. Your business is likely to go through major changes and you’ll be behind the curve with technology that’s plateaued in capability.

On the other hand, often TaaS suppliers will have factored in an equipment refresh in four or five years. Another benefit of going down the TaaS route is that suppliers invest in their technology to keep up with market advancements, meaning you’re better placed to meet the needs of the business and its workers.

Essentially, we are comparing apples with oranges. When building a business case keep the focus on the factors that make a real difference, such as the value of agility.

Is the supplier market ready? 

There’s concern that some of the services offered require significant investment and time to build and many organisations don’t want to be the guinea pig. This concern may be valid where the supplier is facing a greenfield build. However, more often than not, we’re looking at a brownfield case whereby the suppliers may simply be tweaking existing services.

An assessment is required on a product-by- product basis, not on a supplier-by- supplier basis. Understanding your needs and taking the time to do your research is key. Once complete, an organisation can progress on a more sure footing by selecting tested and more mature products and waiting for others to be proven.

Will the suppliers perform? 

There is a perception that suppliers in general are performing poorly today, albeit that there are many examples of happy customers. This being said, many wonder how suppliers will perform as they move to as-a-Service products. This issue is particularly relevant for organisations managing their own environment, and looking to change.

Cloud has changed the way business is done and with this reality, suppliers too are changing how they deliver products to the market and are marching out continuous improvements in an attempt to gain market favour.

Suppliers are investing heavily in automation and providing portals which offer the customer greater visibility and ability to self-serve. Standardised products only help the supplier market in this regard.

The big question is how far along the maturity curve is an individual supplier. Have they got a proven track record that reflects your needs or are their proof points irrelevant? Only a current assessment of suppliers in question will tell. Do your homework. There is fierce competition among suppliers and it’s important their service meets your expectations.

When will I see a return?

Commercial benefits of transitioning to as-a- Service can take some years to be fully realised. In many cases larger organisations face one or two years of transition before they can look to reorganise their operating model from capex to opex. During this period the organisation can also be faced with duplication of costs as operating expenses increase. Additional expenditure is often required to make the transition to as-a- Service, and it takes time to wind down legacy investments. That’s why you need to take a holistic, long-term view of this, and any major technology transition.

In other cases, some organisations are coming off long term contracts that could mean immediate savings are available, however, it seems that this is not the norm.

Whichever way you look at it, a strategy favouring legacy platforms will involve continued high capital expense and the usual swath of operational expenses. This combination undoubtedly results in a significantly higher total cost of ownership, year-over-year, when compared with an as-a-Service approach.

A clear vision, beginning by looking at the long-term view and gaining a good understanding of the TCO (6-10 years with at least one refresh), and education of key stakeholders of the long term capability, agility and cost-effectiveness benefits is necessary to build a business case.

In summary 

No major technology decision comes without challenges and whilst these concerns are valid and can’t be ignored they shouldn’t get in the way of you looking hard at the business case for making the shift to TaaS. The potential benefits are too great to pass up and challenges can be overcome by doing the homework around business requirements and market assessment, and creating a solid roadmap. Lead with a vision that challenges how your organisation does things today and remember roadblocks aren’t always good enough reasons to say no.

As further background on the topic of consumption services, you might be interested in the following e-book: Boost your Agility, Capability and Cost Effectiveness – Travel Advice for your Journey into as-a-Service.

 

To discuss the topic further, please get in touch with the author, Dudley Harris, on 021 585 515.

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