Carriers Said to Still Be Figuring Out How to Monetize a World of APIs and Changing Networks
Telecom carriers are changing how they work together and cooperating on making application programmable interfaces (APIs) available to customers, speakers said Thursday during a TelecomTV conference. They also warned that while carriers are anxious to find new business lines, much about how the future will look remains unclear.
Sign up for a free preview to unlock the rest of this article
Communications Daily is required reading for senior executives at top telecom corporations, law firms, lobbying organizations, associations and government agencies (including the FCC). Join them today!
Nathan Rader, vice president of service and capability exposure at Deutsche Telekom, said the question everyone is still asking is when carriers will start to make money by exposing APIs. Rader, who serves as chair of Project Camara, a global API alliance, said the project is working, and “we’re standardizing APIs.” But that doesn’t mean “we’re monetizing or selling the APIs.” Whether carriers will find financial success through open APIs remains to be seen, he said.
A single provider won’t be able to monetize APIs on its own, Rader said. “We need to work together as a group,” and that work is starting to happen, he added. “The GSMA is driving us together -- we’re changing our mindset.” Carriers used to think they couldn’t be in the same room or someone “would burst into flames or be hauled off to jail.” Now they're on calls together and talking about APIs and shared customers, he said.
The other problem is that developers don’t know what to do with APIs yet, Rader said. “They don’t know what a network API is.” He noted that Deutsche Telekom has pivoted its strategy, so it no longer simply presents its API product and asks customers to buy it. “We’re now saying, ‘Well, actually we need to give you a solution. We need to solve your difficult problem because you’re not able to figure out how to use those APIs yourself.’”
For the last 10 years, the telecom sector has grown very slowly, said Warren Bayek, vice president of technology at Wind River, an open network company. If the sector doesn’t change, industry executives will be looking back in 10 years and saying that the software giants “saw 60% growth, and we saw two,” Bayek said. “We don’t want to be there in 10 years. We want to change that paradigm.”
Apps, cloud services and AI platforms are adding significant value to networks, Bayek said. “That’s the opportunity we need to seize.” New revenue is coming, and carriers must find a way to capture part of it, he said. One thing he said he has learned in the last decade is, “If Nvidia says something is going to happen, it’s probably going to happen.” If providers can work together and with companies like Nvidia, “we will create value where we probably can’t see it today.”
Jishnu Dasgupta, who leads marketing for Nokia’s Network Monetization platform business, said the telecom sector is finally changing and breaking out of the traditional way it has always done business. Industry has been investing “heavily” in automation, cloud-native networks and “the buildup of programmable service fabric” and is now, for the first time, exposing the capabilities of the network by offering open APIs.
“We’re finally collaborating across the industry” to provide APIs “in a unified form” to businesses, Dasgupta said. “Fundamentally, we need to understand that the playing field has changed.”
“Monetizing the edge” means “making sure that the data gets processed where it needs to be and the applications are located where they need to be” to process the data and provide the feedback customers require, said Beth Cohen, an industry analyst at Luth Computer and former Verizon executive. Carriers provide the network, “and it’s not just dumb pipes.” They own routers and virtual network services at the edge and have the capacity to provide the platform businesses need, she said.
AI will play a role, but there are lots of use cases that don’t require it, Cohen said. An IoT cloud has thousands of devices, and they’re all generating data, she noted. “That data is feeding into something -- you probably don’t want to bring it all back into the core.” She cited the example of an oil and gas drilling rig. “Do you really want to bring it back into the core, which is expensive” if it has to go over a satellite or 4G connection?
In order “to fully realize the potential” of new services like connected vehicles, providers “are coming to the realization that we have to work together,” Bayek said. “There is a lot of money on the table in the next 10 years” in the telecom industry, “plenty for everyone in this room,” he said. “Playing together benefits all of us.”