• Telekom Deutschland Chief Executive sees industry value already shifting from physical infrastructure to software architecture.
  • Network orchestration layer and partnerships key to realising telco‑as-a-platform vision.
  • Cannibalisation of legacy revenue part of the digital transformation journey.

Softwarisation is industry’s destiny, says DT’s Gopalan

Softwarisation is industry’s destiny, says DT’s Gopalan

Source: Deutsche Telekom

Srini Gopalan, recently installed as Chief Executive of Telekom Deutschland — and rising star within Deutsche Telekom (DT) following a successful stint as Head of Europe (Deutsche Telekomwatch, #103) — called on forward‑thinking telcos to embrace “softwarisation”.

We believe it’s the destination of our industry”, asserted Gopalan, who added that DT could be leader in the field by 2030. To achieve successful digital transformation, however, Gopalan warned that telcos must be prepared to take some radical steps and usher in cultural change.

A willingness to cannibalise legacy revenue, he ventured, was necessary to stay relevant to customers. Giving up on MPLS connectivity revenue and providing enterprises with software-defined networks instead was one example. Telcos must also be more open to different types of partnerships — something Gopalan is especially keen on at DT — “to grow the overall pie”.

Different mindsets

Gopalan was speaking at Converge 2021, a recent virtual event hosted by Headspin, a quality‑of‑experience management platform specialist using AI tools. The audience was evidently software-minded, and Gopalan was not afraid to play to the gallery.

I often say we spend more time in software envy than actually developing software”, he quipped, although he was not prepared to abandon industry’s physical infrastructure roots. “It is still critical for us to own physical infrastructure, and there is still value in owning the last mile”, he continued — although nonetheless appeared to lament the long payback times and associated investment uncertainty from infrastructure‑building.

The software industry is fundamentally different”, added Gopalan, warming to his theme. “We need a different culture to combine infrastructure and software, which is a lot easier said than done”.

He asserted that industry value was beginning to shift away from physical infrastructure to software-based architecture, most notably in the network orchestration layer. “This value migration is probably the biggest thing that we as telcos need to learn how to work with”, he said.

Where we are now

Gopalan’s call for telco change was part of a Q&A session following a brief presentation on how industry typically goes about its business today. In a familiar slide, at least in telecoms circles, Gopalan described a four-layer model. The base is the physical infrastructure layer, on which connectivity technologies sit. Software architecture is the next layer up, on which perch products and services.

For many years [the four-layer model] has existed as single monolith, where the telco has combined all four elements”, said Gopalan. “As an industry, historically, we’ve not spent a huge amount of time decoupling these various elements, but over the next few years we will see this monolith get significantly fragmented”.

He pointed out that various industry trends and multiple technologies — such as satellites, regional fibre companies, private campus networks, along with specialist IoT companies and TowerCos — were already disrupting the physical infrastructure layer. Connectivity technologies are also changing and diversifying, most obviously with the arrival of 5G.

Software architecture is the key layer in many ways, because it connects the physical pipes to the end-consumer product”, emphasised Gopalan. “It has become critical”.

He explained that the task of software architecture is changing from running a single set of physical pipes to become much more of an orchestrator across multiple different technologies and multiple different infrastructures. “This [process] is only going to accelerate,” he added.

To try and illustrate why a revamped network orchestration layer might add value, Gopalan gave an example of a B2B customer wanting international connectivity. “What they’re interested in is someone who can orchestrate the multiple different technologies that will be used across the world into a simple dashboard, which allows them to choose what kind of latency, speed, and security they want”.

Telco-as-a-platform

The software end-game for Gopalan is telco‑as‑a‑platform, which means open APIs northbound and southbound. Northbound interfaces allow different services from different partners, the classic examples today being the likes of Zoom and Webex, but also, stressed Gopalan, help in the provision of software-defined private networks. Southbound open APIs allow telcos to more easily integrate with multiple partners, assets, and microservices.

The middle layer is telco-as-a-platform, which brings together not only network orchestration but also northbound and southbound integration of different platform services, such as unified data and analytics engine, product design and development, and security. “Transformation is either a big risk if you want to remain a traditional telco, or a big opportunity for telcos willing to embrace softwarisation of industry”, said Gopalan.