Category: Insights

According to 3.4 billion by 2026,” Blockchain will generate $3.1 trillion in new business value by 2030, but with the technology set to be ready for more mainstream adoption through 2023, organizations should be exploring it now”

Digital transformation leads to an explosion of data. As a result, the business landscape of the Service Providers has evolved. The Digital Service Providers (DSPs) are no longer dependent on traditional services which fail to fulfil their customer needs and prevent them from realizing the potential value of the upcoming shared economy. There is an increasing need to simplify, streamline, and secure transactions of different kinds, and blockchain can effortlessly play a vital role in realizing this. 

What hinders the transformation journey of DSPs today?

As the current business models are heavily data-driven, many DSPs struggle to reinvent products/services and stay ahead of the competition. This forces the DSPs to innovate continuously to be relevant in the customer value chain. The major pain points in the DSPs’ current landscape are:

• Lack of real-time updates to different systems leading to data inconsistency and duplication
• Inefficient security mechanisms failing to protect the customer data
• Numerous fraudulent activities causing revenue leakage
• Business transactions across multiple third parties with no consensus, leading to a dispute

DSPs can overcome these challenges and gain a competitive edge by embracing blockchain.

Embracing Blockchain to stay ahead of the competition

For DSPs looking for innovative ways to reduce the underlying costs and improve business profitability, Blockchain adoption can be a great fit. Blockchain’s inbuilt capabilities like the smart contract, cryptographic security mechanism, and data storage in decentralized ledger help to manage various decentralized applications with an agreed contract, in an autonomous way. It helps to establish consensus among all the parties and promotes trust in the ecosystem. Hence, blockchain can truly enable “Anything as a Service” for consumers.

Blockchain use cases in DSPs’ landscape

Blockchain adoption can enable DSPs to be profitable and relevant in the digital economy. The adoption strategy can be of two types: 

1. Vertical strategy, where a new set of business models or use cases can be derived to generate a new revenue stream 
2. Horizontal strategy,where the existing system can be integrated with blockchain to add business value or reinvent the new sources of revenue.

Based on our ongoing conversations with the DSPs around the globe, we see that there are five use cases where blockchain can add immediate and tangible value.

Fig 1. Blockchain-powered use cases in DSPs’ landscape

1. 5G enabled applications:
   Today most DSPs have started deploying 5G which paves the way for new use cases like City Pass, Smart Tolls, Smart Grids, and multi-edge clouds solutions. These new-age solutions demand the development and maintenance of a complex application ecosystem. This leads to an increase in CapEx and deployment time. Some of the important features of Blockchain such as tamper-proof data storage, fault tolerance, and decentralized data distribution allow 5G users to exchange data between their peers, eliminating the centralized operational requirement. It ensures data provenance, accountability, and maximum security for all users.
2. Smart Settlements:
   Current settlements go through various audit processes carried out by third parties leading to errors and lack of transparency. The current process also takes a long time, causing delays in revenue realization. Smart settlements on blockchain enable automation and guarantee settlement between the participants by routing from one operator’s blockchain to another, thus providing the end customer with increased transparency.
   
   For example, if a subscriber uses his phone network while roaming, then this transaction is logged and saved on the Blockchain network (from start to end). The smart settlement will define the charges and the way payment is registered. This end-to-end transparency ensures the integrity of the transaction. 
3. Digital Supply Chain Management:
   Current operation services provided by DSPs contain a multi-threaded supply chain ecosystem that requires interdependent teams. Also, supply chain data is not always visible, available, or trustworthy. Digital supply chain management on the blockchain can solve process inefficiencies and improve transparency by building resilient supply chain systems. It enables DSPs with automatic and streamlined partner onboarding, asset management, and order management.
4. Secure Cyber Transactions:
   DSPs have evolved from accepting payments only via cash to building cashless economies. Today, as transactions happen through multiple payment gateways, achieving a secure and transparent process has become a challenge. Blockchain-powered transactions are immutable because they cannot be deleted or changed. It facilitates fast, secure, and low-cost international transactions with encrypted distributed ledgers. Further, it enables real-time verification of transactions without the need for intermediaries.
5. Prevention of fraudsters:
   Technology improvements have enabled fraudsters to outsmart traditional fraud management as data is exchanged in real-time. According to a report by Deloitte, “DSPs lose ~ USD 40 Bn every year due to fraudulent activities”.  In addition to cost, it can decrease create an unstable business environment as well as undermine business and consumer relationships.
   Blockchain combined with traditional rule-based security creates an unalterable record of transactions with end-to-end encryption, closing the doors for fraud and unauthorized activities. Additionally, data on the blockchain is stored in a Peer-to-Peer(P2P) network, making it nearly impossible to hack, thus making DSPs less susceptible to fraud.

Conclusion

Blockchain has immense potential in accelerating the DSPs’ digital transformation journey with its inbuilt functionalities like decentralized storage and cryptographic data security. The rapid adoption of blockchain reduces the dependency on traditional centralized software to provide an authentication mechanism. Thus, DSPs’ transformation journey lies in combining their strengths in connectivity and leveraging blockchain for its security, trust, and speed.

Introduction
The worldwide 5G subscriptions are expected to exceed 3.4 billion by 2026, with North America, Western Europe and North East Asia leading the pack. The rapid expansion of 5G networks will significantly change the current roaming process. The new relationships between Digital Service Providers (DSPs) and enterprise networks will become more complex than ever before. The contract negotiation, management, and reconciliation of inter-operator agreements will become more challenging, especially when it comes to ensuring an accurate clearing and settlement of transactions among a complex network of roaming partners. Incorrect identification of roaming data can increase revenue leakage and impact the business.

A possible solution to thrive in the 5G economy is adopting blockchain-enabled roaming service activation and dispute settlement. Blockchain is a shared, immutable ledger that facilitates the process of recording transactions and tracking assets in a business network. A blockchain-enabled roaming service would make the entire process more automated and robust while ensuring greater transparency, accuracy, and security in all roaming transactions.

Challenges faced by DSPs in the current roaming process and how this complexity will further increase with the onset of 5G and IoT

1. Increased number of players in the 5G and IoT ecosystem and the launch of new products and offerings will lead to a multi-fold increase in contracts and disputes
   • 5G unlocks a world of opportunities enabling varied services like connected cars, smart grid, virtual and augmented reality, and a wide array of internet of things (IoT) applications. Gradually these services will be bundled and offered to roamers as well. This will make the roaming services more complicated as the service orchestration and billing will be further extended to other systems involving multiple players in the ecosystem. Along with the service providers and end customers, this would also include OEMs, software vendors, cloud providers and many more. These multi-party transactions are governed and controlled by various manual contracts bound by multiple rules. In turn, these 5G enabled services will lead to a multi-fold increase in contracts and disputes.
2. Providing roaming service in an ecosystem where both 4G and 5G network co-exists will further complicate the service activation process
   • The 5G network brings two types of network operations to serve the existing 4G and the new 5G deployment. The Non-Standalone (NSA) mode works on both 4G and 5G networks and the Standalone (SA) mode works on a dedicated 5G network. As the deployment effort of a standalone mode is significantly higher in terms of Capex and Opex, it will take longer to get settled in the new ecosystem. Hence, the non-standalone mode will be the path of transition. However, this will complicate the key roaming processes such as latching to visiting network, user authentication and billing settlements.
3. Complex contract management with multiple systems decreases the overall process efficiency
   • Currently, DSPs need to maintain the contract management information on multiple systems and in some cases, it may even be spreadsheets. This leads to redundant provisioning, longer onboarding, and tedious service activation processes. It increases the risk of missed or misaligned configuration amongst multiple service instances. As the market complexity grows in the 5G era, the contracts often lead to complex and incorrect calculations, resulting in commitment penalties and unnecessary costs due to improper management.
4. Delayed dispute settlement impacts the cash flows

   

   Fig 1: A typical workflow of dispute settlement through the clearing house

   • The evolution of competitive markets naturally increases the number and type of disputes. These may involve failures to fulfil contractual obligations, non-compliance with regulatory requirements, and a wide range of other issues. Settling the disputes with the current approach often takes several months. The primary reason for this delay is the dependency on the clearing house. The clearing house audits the bills and the required artefacts against the agreed contracts. This process is tedious, repetitive, and semi-automatic. It follows a multi-level approval workflow that leads to a longer settlement time. Also, the reconciliation process is maintained in a ledger, making it vulnerable to fraudulent activities and creating trust issues.

Adopting blockchain-enabled roaming service activation and dispute settlement can enable DSPs to thrive in the 5G economy

The intrinsic properties of blockchain can revolutionize the process of service activation and dispute settlement in the 5G era. It drives a faster settlement process and minimal revenue leakage. Additionally, it provides a robust platform to monetize the new business opportunities from 5G and IoT.

Fig 2: Intrinsic properties of Blockchain Technology

Use Case 1 – Blockchain-enabled roaming service activation

Due to the use of multiple systems, the traditional service activation process undergoes a tedious backend operation. The inconsistent record of service activation often leads to various frauds such as sim cloning and identity theft.

Blockchain enables decentralized data processing and secure transactions, removing the need for maintaining multiple systems, simplifying the entire service activation process, and ensuring inter-party operations run more smoothly. It ensures that:

1. All the partners and operators (Home operator and Visiting operator) are part of a blockchain consortium (i.e., a permissioned network)
2. All business logics like contract validation for different countries, ID validation and subscription validations are done through smart contracts (a software program that is intended to automatically execute, control or document legally relevant events and actions when predetermined conditions are met)
3. Operators either choose a mechanism where any monetary transactions can be done between the operators through the inbuilt wallet, or they can choose to keep it out of blockchain like the traditional one

Fig 3: The Blockchain-enabled roaming solution, with its inbuilt capability of decentralized data processing and secure transactions, removes the need for maintaining multiple systems, simplifies the entire service activation process and ensures interparty operations are done more smoothly

Legend:

• HLR – Home location Register
• HPMN – Home Public Mobile network
• VPMN – Visiting Public Mobile network
• MSC – Mobile switching Center
• VLR – Visiting Location Register
• CDR- Call detail record
• TAP- Telecom application Protocol
• SC- Switching Center

Let’s see an example of the blockchain-enabled roaming solution. If the subscriber agrees to use the roaming service, he sends a request to consume the service. To enable this, a smart contract is executed that checks if the subscriber is legitimate. Once this is established, the subscriber can use the services in the visiting network. After the subscriber ends the roaming service, the visiting network (VPMN) sends the transaction details to the home network (HPMN), which consists of the CDR data of the provided service. The smart contract then calculates the subscriber’s service fee and triggers a transaction for payment of the services. All these steps are completely transparent, instantaneous, and automated using blockchain, which removes the chances of any fraudulent activities.

In the traditional roaming process, a subscriber cannot avail the visiting location’s exclusive services and subscriptions. This is due to limitations/absence of various agreements, near real-time sharing of XDRs, and faster settlements between the partner networks. However, the smart contract resolves complicated contract management processes, facilitates faster settlements between the partners and at the same time stores the data in a decentralized manner for easier consumption in the future.

Use Case 2 – Blockchain-enabled automatic dispute settlements

The settlement process enabled by blockchain tackles three difficult and time-consuming processes in the settlement lifecycle – audit invoice, resolve dispute, and invoice processing. The immutable distributed ledger removes the dependencies on intermediaries and makes the entire process more automatic and robust. This brings down the entire settlement duration from few months to just a few days.

Fig 4: Blockchain-enabled automatic dispute settlements

As a prerequisite, all the partners must agree to the principles and be part of the blockchain network. This establishes trust between various parties as it prohibits unilateral changes in the process.

Once the settlement process is initiated, various smart contracts (from the blockchain) are triggered to check the inputs and conditions as per the agreements. This significantly improves the collections of XDRs in near real-time, and hence the billing generation becomes more accurate, resulting in faster settlements and decreased revenue leakage.

Conclusion

Blockchain can completely revolutionize the roaming service activation and dispute settlement processes. For DSPs, the value realization will increase exponentially once the 5G is fully functional along with various IoT-enabled services. Adopting blockchain earlier can enable DSPs to easily tap new business opportunities, have more viable ways to manage their business, and launch new services much faster with a reduced total cost of ownership.

Reduce time-to-market of FTTP delivery by 45%

As the demand for broadband rises, so does the complexity of fiber networks. Most countries around the globe aim to deliver full-fiber broadband to millions of premises in the next 5-10 years. Moreover, the global pandemic has changed the way we work and live, and fiber networks have never played such a vital part in unlocking our digital futures.

But this comes at a time when the costs associated with fiber rollout remain high, particularly as fiber operators and service providers are struggling with the following challenges:

• Multiple legacy and siloed systems affect the time-to-market
• Lack of visibility of premise serviceability restrains service providers from measuring the progress of fiber rollout
• Limited automation across the fiber rollout process results in delayed releases
• Low system security, especially in an ecosystem where multiple partners/vendors are involved, where they cannot have the visibility of one another’s information such as the quotes, plans, costs, etc.

To overcome the above challenges, service providers must transform their workflow by shifting from siloed network rollout to an Opportunity, Planning, Build, Release (OPBR) unified workflow strategy. The OPBR strategy integrates the opportunity identification, network planning, build and release management in an agile model offering scalability, accountability, and collaboration capabilities to the service providers.

In the OPBR strategy, the idea is to split a large opportunity premise (e.g., a residential area with 10,000 houses) into multiple sub-opportunity premises (e.g., address groups and streets), thereby accelerating the network release by 45% as compared to the traditional process.

With a better visibility of the network build progress, service providers can get better overall awareness of the network, resulting in efficiency gains. Repetitive planning and engineering tasks can be automated through software implementation, allowing staff to dedicate more time to higher value activities, thereby making the network more reliable and resilient.

Benefits of the OPBR workflow strategy include:

• 45% faster time-to-market of fiber rollouts to premises
• 35% reduction in the average cost per premises (CPP)
• 50-70% reduction of overall manual efforts in the end-to-end fiber rollout workflow

Service providers must transform their workflow by shifting from siloed network rollout to an Opportunity, Planning, Build, Release (OPBR) unified workflow strategy.

Leverage DevSecOps for proactive prevention of vulnerabilities

As service providers in the Connectedness industry strive to shorten product release cycles, they often deprioritize security. According to Cybersecurity Ventures, “More than 60% of enterprises experience breaches and increase in cyberattacks. Damages due to cybercrimes cost $6 trillion globally, and it is expected to compound annually by 15 percent for the next five years.

Traditionally, service providers implement security features late in the application lifecycle. In addition, the detection and fixing of security issues in the production phase lead to further delays in application releases and high OpEx. The traditional security approach also lacks mechanisms to address the increasing data breaches and rising vulnerabilities in open-source software.

To overcome these challenges and reduce vulnerabilities, service providers must look for ways to enable and prioritize continuous security at every stage of the software development lifecycle. Implementing DevSecOps enables automation, security, and continuous monitoring throughout the software lifecycle. This facilitates continuous integration, faster delivery of secure products, and reduction of compliance costs.

Fig: The four-step approach to implement DevSecOps and accelerate secure product releases

According to Cybersecurity Ventures, “The Cybercrime damages cost $6 trillion globally, and the cost is expected to increase by 15 percent per year over the next five years”.

From development to test to production, CI/CD over containers automates every phase

There have been significant changes in application development over the last decade. Organizations have seen huge benefits from moving from the traditional linear application development process to a DevOps-based Continuous Integration/Continuous Delivery model that supports frequent feedback mechanisms from development to operations. Furthermore, containerizing the CI/CD process greatly increases the agility, portability, and controllability in development, testing and deployment phases.

Figure 1: Solution benefits – CI/CD vs CI/CD over containers

CI/CD over containers facilitates the rapid deployment of secure and quality applications.