A few weeks ago, I introduced the topic of Private Mobile Broadband (P-MBB) networks also referred to in specific implementations as Private LTE or Private 5G. The issue in that blog was Do-it-yourself versus Managed Services and was written from the client’s perspective. Now I want to talk about the challenges for Mobile Network Operators (MNOs) of doing a Managed Services offering (or trying to be the lead integrator in a DIY deal).

Here is the link to the previous article.

A Managed Services offer for P-MBB a Mobile Network Operator (MNO) would seem to be a no-brainer. As a recent Ericsson presentation pointed out, MNOs have:

1. Spectrum (which last time we showed was a critical element);
2. Scale (to which I would add scope – they have the people and processes to do this);
3. Coverage;
4. Their networks maintain themselves on a constant evolution path (i.e. nearly automatically ‘evergreen’);
5. They can bundle other needed services like backhaul, Cloud and IoT management.

If the application has a large number of geographically dispersed sites – like a railway or electrical network – it would be hard to beat the economics or the convenience of an MNO offer:

• Such applications need portfolio different spectrum bands over a broad geographic areas which might be difficult or even impossible for the client to assemble themselves;
• They need geographically dispersed maintenance and operations staff which, presumably, an MNO can provide more efficiently than having to use dedicated staff in low activity locations for a client who went DIY;
• Such networks need geographically dispersed coverage which MNOs must provide anyway for their mass market clients (although long-haul transmission lines and railways often travel through fairly isolated areas);
• ‘Evergreen’ may not be an important criterion but it comes along ‘for free’ if you will;
• Clearly backhaul is required at a minimum and MNOs should be able to create a competitive bundle with Cloud and IoT management as value-added components.

But the MNO value proposition is less clear for applications like factories or ports which are less geographically dispersed. The client may have only one, fairly concentrated site. The MNO may not even be needed to provide spectrum for a factory or an isolated mine where interference problems with unlicensed spectrum many be minimal to nonexistent.

There are also hybrid situations, especially where the MNO’s Managed Services offer is used for basic connectivity, but it does not get to participate in higher order services like Edge Computing, Analytics or Cloud.

The most obvious such case is where integrating the Operations Technology (OT) components are critical to the client’s application. Again, a modern factory is an obvious example. While basic communications services may also be needed, the core of the P-MBB network is integrating the clients manufacturing equipment. The client may only trust its OT vendor for integration or the OT vendor may insist on doing the integration, relegating the MNO (if even needed) to simply a subcontractor on the connectivity portions.

As with IoT, the challenge for an MNO is the opposite of one of its strengths in the provision of communications services: scope.

Ken Rehbehn and I are looking at nearly a dozen sectors many of which – like factories – themselves break into dozens of sub-sectors. Normally, OT vendors either specialize in a few applications or big firms like say Siemens cover many sectors but look for synergies between sectors to allow their own businesses to scale.

It is unlikely to be economic for an MNO – even a very large MNC MNO – to try and cover the entire ‘waterfront’, to address all sectors equally. They can pick a few to build vertical capabilities but only study the dozen or so most important verticals (like those that we have identified in our study) so they can carry on an intelligent conversation with clients.

Even Nokia, which wants its FutureX architecture to be applied to all verticals and has a wide range of documented use cases, has started with only three pre-packaged solutions for carriers: Agro, Ranching and Logistics.

A second challenge is still rigid MNO culture.

I worked in Corporate Strategy at Bell Canada in the 1990s and one of our themes was transforming culture so that it was more innovative and customer-oriented. At that time, senior and middle managers had been promoted to their positions because they had been successful in a regulated monopoly where following the rules and never making a mistake was rewarded more than taking a risk or being creative.

I left before the end of the decade so I don’t know how that worked out at Canada’s largest telco.

However, I find it somewhat depressing when general industry discussions about telco flexibility with their clients or partners result in reactions that range from wry smiles to outright hostility. Twenty-five years after identifying the problem and the need for change, over thirty-five years since the introduction of competition, clients and partners still find telcos rigid and hard to work with.

Twenty to thirty years represent at least a couple of managerial generations. Those now thinking of retirement today were hired into companies that already had lost their monopolies and were facing competition.  But because they were ‘brought up’ by pre-competition managers, apparently today’s telco leaders still bear that stamp.

John Legere may be an exception but I am not sure that Hans Vestberg swapping his crisp white shirts and dark suits for a black t-shirt is sufficiently transformative to change Verizon’s culture.

Success for MNO in playing – at all – in the P-MBB market means bringing creative solutions to clients that, by their nature, would rather Do-It-Themselves.

I’ll climb / The hill in my own way

Title Reference: The quotes including the title are from Fearless by Pink Floyd. I made the choice because it touched both sides of the DIY versus Managed Services debate: the clients need to be fearless and ensure that the network is implemented to their needs – in their own way – and the MNO’s need to be fearless but also resist their tendency to force the client to do it in their own way regardless of the customer’s need. The song is notable for the lyrics obviously, a rather unusual musical structure – once you hear it you will know what I am talking about – and for a closing segment with Liverpool fans singing (as they always do) You’ll Never Walk Alone. I am really not sure why Fearless is well-lodged in my memory. It comes from the 1971 album Meddle, one I had either forgotten or maybe even never heard of until doing this research. Fearless was released as a single but there was no way it was played on the local Belleville, Ontario radio station (CJBQ) that was my only (daytime) choice in 1971. (Nor would it have been played on WOWO Fort Wayne, Indiana which is what we listened to at night.) I assume it got stuck in my head sometime after 1973 when I was living in Montreal and listening to what we used to call an ‘album-oriented progressive rock station’, CHOM-FM. Maybe I remember it because I am also a big fan of Rogers and Hammerstein.

Fearless lyrics by David Jon Gilmour / Roger Waters © Peermusic Publishing, Warner/Chappell Music, Inc, BMG Rights Management

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