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Network as a Service(NaaS)

Selling a service instead of access will be the future for all telecommunication companies to come. The current trends are all pointing in the direction of cannibalizing the ‘control’ that telecom operators have in today’s world. Data deluge has begun as have seen in the last few years and it will only increase astronomically. MNOs in order to retain control over their networks, while preventing customer churn, diminished profitability and brand devaluation, must shift their role from traffic carrier to “application enabler.” With this approach, they can derive the greatest possible value from their network and its capabilities by developing and delivering first- and third-party applications.

Today’s mobile application explosion and evolution to 4G technology give service providers a valuable opportunity to transform their networks and services to deliver a truly next-generation Web 2.0 experience — profitably. Wireless providers have a number of key assets they can leverage to drive incremental revenues. When these assets are integrated within innovative applications, they strengthen the value of the application and the end-user experience.

 

Source: Alcatel-Lucent

Application Enablement addresses the mobile web’s disruptive changes by helping MNOs partner with developers, media and content players in new ways, so they can open and enrich their networks and, ultimately, grow their brand. Application Enablement contributes to market relevance by removing barriers and fostering new ecosystems. To enable applications, service providers require a High Leverage Network — one that offers scalability, awareness and optimization, while being oriented toward service delivery, monetization, faster time-to market and accelerated ROI. Operators can leverage these solutions to transport and deliver traffic more reliably, efficiently, flexibly and at lowest cost. The challenge, in the current environment, is to grow beyond core telecom capabilities. Growth areas can include extended and enhanced “franchise” services, as well as creation of new branded services that combine network enablers with application developers’ capabilities. Additional revenue streams can also be generated with new (potentially unbranded) services in non-traditional areas.

Understanding the Cloud Architecture

Subscribers have a limited view of the value of simple broadband access. For most, it is simply a means of accessing applications and content they care about, from a source other than their wireless service provider. Competitive messaging has intensified end-user confusion, further complicating a service provider’s ability to differentiate wireless broadband access. Customers attribute value to services from which they perceive direct personal benefits. They are willing to pay a certain price for particular types of entertainment, such as reading a book or watching a movie. The Amazon Kindle offers a good example of such bundled value. Customers pay a fee to download books or other content to the device. This fee is comparable to the cost of a physical book, which has a well-established price point. Embedded in the fee is a charge for the data download, which Amazon passes on to the service provider. For instance, when a Kindle customer orders a book or magazine from Amazon, the book is delivered over the Sprint wireless network, although the customer is not required to have a Sprint account — and may not know which network is used to deliver their content. Sprint generates revenue through a per-download agreement with Amazon. Amazon has agreements with mobile networks in “over 100” countries, allowing Kindle owners to use these partner wireless networks around the world for free, while Amazon pays all the download costs.

National Institute of Standards and Technology (NIST) has been directed to develop a cloud strategy and set of cloud standards by the Federal Chief Information Officer. The following is the NIST Definition of Cloud Computing.

“Cloud computing is a model for enabling convenient, on-demand network access to a shared pool of configurable computing resources (e.g., networks, servers, storage, applications, and services) that can be rapidly provisioned and released with minimal management effort or service provider interaction. This cloud model promotes availability and is composed of five essential characteristics, three service models, and four deployment models.”

 

Source: NIST

 Essential characteristics

On-Demand Self-Service – A consumer can unilaterally provision computing capabilities, such as server time and network storage, as needed automatically without requiring human interaction with each service’s provider.

Broad Network Access – Capabilities are available over the network and accessed through standard mechanisms that promote use by heterogeneous thin or thick client platforms (e.g., mobile phones, laptops, and PDAs).

Resource Pooling – The provider’s computing resources are pooled to serve multiple consumers using a multi-tenant model, with different physical and virtual resources dynamically assigned and reassigned according to consumer demand. There is a sense of location independence in that the customer generally has no control or knowledge over the exact location of the provided resources but may be able to specify location at a higher level of abstraction (e.g., country, state, or datacenter). Examples of resources include storage, processing, memory, network bandwidth, and virtual machines.

Rapid Elasticity – Capabilities can be rapidly and elastically provisioned, in some cases automatically, to quickly scale out and rapidly released to quickly scale in. To the consumer, the capabilities available for provisioning often appear to be unlimited and can be purchased in any quantity at any time.

Measured Service – Cloud systems automatically control and optimize resource use by leveraging a metering capability at some level of abstraction appropriate to the type of service (e.g., storage, processing, bandwidth, and active user accounts). Resource usage can be monitored, controlled, and reported providing transparency for both the provider and consumer of the utilized service.

Service models

Cloud Software as a Service (SaaS) (i.e. use provider’s applications over a network):  The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure and accessible from various client devices through a thin client interface such as a Web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure, network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings

Cloud Platform as a Service (PaaS) (i.e. deploy customer-created applications to a cloud): The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created applications using programming languages and tools supported by the provider (e.g., java, python, .Net). The consumer does not manage or control the underlying cloud infrastructure, network, servers, operating systems, or storage, but the consumer has control over the deployed applications and possibly application hosting environment configurations.  

Cloud Infrastructure as a Service (IaaS) (i.e. rent processing, storage, network capacity, and other fundamental computing resources): The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems, storage, deployed applications, and possibly select networking components (e.g., firewalls, load balancers)

Deployment models

Private cloud (i.e. enterprise owned or leased): The cloud infrastructure is operated solely for an organization. It may be managed by the organization or a third party and may exist on premise or off-premise.

Community cloud (i.e. shared infrastructure for specific community): The cloud infrastructure is shared by several organizations and supports a specific community that has shared concerns (e.g., mission, security requirements, policy, and compliance considerations). It may be managed by the organizations or a third party and may exist on premise or off premise.

Public cloud (i.e. sold to the public, mega-scale infrastructure): The cloud infrastructure is made available to the general public or a large industry group and is owned by an organization selling cloud services.

Hybrid cloud (i.e. composition of two or more clouds): The cloud infrastructure is a composition of two or more clouds (private, community, or public) that remain unique entities but are bound together by standardized or proprietary technology that enables data and application portability (e.g., cloud bursting).

 

 

 

Everything as a Service (XaaS)

Everything as a Service is a broad term embracing all cloud computing models.

 

Most mobile network operators provide one additional service model that is outside the NIST definition which is Network as a Service (NaaS). NaaS is a combinational service of platform offerings (PaaS) and infrastructure offerings (IaaS). With the NaaS model, operators treat their key network assets – communications, information, and intelligence – as marketable resources that can be offered to third parties on a commercial basis.

The cloud is both old and new at the same time. Cloud computing is not a technology; it is the conversion of a set of technologies to be offered in the form of an Internet- or network-based service rather than as asset purchases. It is built on the knowledge and experience of timesharing, Internet services, Application Service Providers, hosting, and managed services. So, it is an evolution, not a revolution. There are lots of shades of gray with cloud segmentation. There are three buckets that we put clouds into: infrastructure as a service, platform as a service, and software as a service. Now, that’s nice and simple. However, it isn’t because all of these areas are starting to blur into each other. And, it is even more complicated because there is also business process as a service. This is not a distinct market unto itself – rather it is an important component in the cloud in general.

Market leadership is in flux the market place for cloud was fairly easy to figure out earlier. There were companies like Amazon and Google and an assortment of other pure play companies. That landscape is shifting as we speak. The big guns like IBM, HP, EMC, VMware, Microsoft, and others are running in. They would like to control the cloud. It is indeed a market where big players will have a strategic advantage.

The cloud is an economic and business model. Business management wants the data center to be easily scalable and predictable and affordable. As it becomes clear that IT is the business, the industrialization of the data center follows. The economics of the cloud are complicated because so many factors are important: the cost of power; the cost of space; the existing resources — hardware, software, and personnel (and the status of utilization). Determining the most economical approach is harder than it might appear.

The private cloud is real. For a while, there was a raging debate: is there such a thing as a private cloud?

A private cloud is the transformation of the data center into a modular, service oriented environment that makes the process of enabling users to safely procure infrastructure, platform and software services in a self-service manner.  This may not be a replacement for an entire data center – a private cloud might be a portion of the data center dedicated to certain business units or certain tasks.

The hybrid cloud is the future. The future of the cloud is a combination of private, traditional data centers, hosting, and public clouds. Of course, there will be companies that will only use public cloud services for everything but the majority of companies will have a combination of cloud services.

Managing the cloud is complicated. This is not just a problem for the vendors providing cloud services. Any company using cloud services needs to be able to monitor service levels across the services they use. This will only get more complicated over time. Security is king in the cloud. Many of the customers are scared about the security implications of putting their valuable data into a public cloud. Is it safe? Will my data cross country boarders? How strong is the vendor? What if it goes out of business? This issue is causing many customers to either only consider a private cloud or to hold back. The vendors who succeed in the cloud will have to have a strong brand that customers will trust. Security will always be a concern but it will be addressed by smart vendors.

Interoperability between clouds is the next frontier. In these early days customers tend to buy one service at a time for a single purpose — Salesforce.com for CRM, some compute services from Amazon, etc. However, over time, customers will want to have more interoperability across these platforms. They will want to be able to move their data and their code from one environment to another. There is some forward movement in this area but it is early. There are few standards for the cloud and little agreement.

The cloud in a box: There is a lot of packaging going on out there and it comes in two forms. Companies are creating appliance based environments for managing virtual images. Other vendors (especially the big ones like HP and IBM) are packaging their cloud offerings with their hardware for companies that want Private clouds.

 

 Monetizing Potential

Leveraging the network as platform to create value:  MNOs have unique and valuable untapped assets that can benefit developers, consumers and vertical industries. Application Enablement makes it easier to combine these assets with web applications to enable a richer user experience, while new business models benefit all stakeholders, particularly network providers and application and content providers. The key to Application Enablement is a network with assets that are easy to access, combined with an ecosystem that facilitates their exposure to application and content providers. For example, wireless networks can expose capabilities such as location with a high level of accuracy, making an application more useful to subscribers. Subscriber context and billing information are other valuable network assets.

As networks evolve to all-IP LTE, real-time services such as video Quality of Service (QoS) can be exposed and made available to trusted developers, resulting in innovative and blended new services. For example, QoS can be provided for different types of applications used by the same user, or QoS can be allocated among different types of users, driven by their subscriber profiles and network policy management.

 Accelerating service creation through Application Enablement and Open APIs: The key to Application Enablement is a network with assets that are easy to access, combined with an ecosystem that facilitates their exposure to application and content providers. For example, wireless networks can expose capabilities such as location with a high level of accuracy, making an application more useful to subscribers. Subscriber context and billing information are other valuable network assets. As networks evolve to all-IP LTE, real-time services such as video Quality of Service (QoS) can be exposed and made available to trusted developers, resulting in innovative and blended new services. For example, QoS can be provided for different types of applications used by the same user, or QoS can be allocated among different types of users, driven by their subscriber profiles and network policy management.

In the Web 2.0 environment, application programming interfaces (APIs) are becoming a currency for developers and vertical industries. APIs are a set of routines, protocols and tools for building software applications. A good API makes it easier to develop a program by providing all the building blocks. A programmer then puts the blocks together. 

 Exploding appetite for new applications over LTE:  As LTE expands the scope of Application Enablement in wireless networks.  Research (ALU survey below) has shown that a significant part of the users are willing to pay for data services in the future. Anticipated uses for LTE technology show a majority of consumers and business users are ready to sign up for LTE services, and many would switch carriers to get LTE capabilities. Anticipated uses vary from Internet browsing to watching or sharing video to playing games — all offering a rich user experience that combines smart devices, smart applications and smart 4G LTE networks that transform today’s connected lifestyle. Customers are interested in Quality of Experience and applications that provide additional context, like location and presence. The evolution of current wireless networks to LTE creates yet another opportunity to extend Application Enablement to more applications that are made possible by LTE such as VoIP, video and gaming further enhancing the user experience.

 

 Machine-to-Machine solutions: Recent changes in machine-to-machine (M2M) technology, economics and regulatory drivers have sparked renewed interest in the M2M space. The lower cost of devices and connectivity services, increased bandwidth with LTE and investments in smart-grid and green IT initiatives are all fueling the growth of M2M services. Market reports and analysis show that anywhere from 15 billion up to 50 billion connected devices will be active in the next five years.

The congestion issues created by unpredictable traffic from large numbers of smart devices cannot be mitigated simply by increasing bandwidth. Operators’ initial focus has been primarily to grow mobile data revenues through wholesale mobile data access plans. In many cases, they have no knowledge of the application or device that is generating data traffic — and a limited view of the impact these applications have on the network. This lack of information limits the opportunity to provide or guarantee service quality and measurements. However, Application Enablement can help achieve a transformation of the traditional wholesale data opportunity for M2M into a high-revenue VAS and service experience model.

Exposure of network capabilities for application developer usage is quite relevant to M2M. The range of connected devices is growing beyond telemetry and asset tracking in 2G/3G, the traditional M2M service domains, and it will continue to grow with 4G LTE deployment. These new devices range from smart meters and smart grid solutions to healthcare, education, signage, security and transportation. Giving developers access to device-based services is the logical extension of application-based business models: It monetizes the ability to activate, manage and support machines remotely. Because end devices are a critical part of the application, operators need to leverage their device expertise to extend their M2M solution ecosystem and play a key role in the value chain.

Appendix

  Definition
Circle of trust A federation of service providers and identity providers that have business relationships based on Liberty architecture and operational agreements and with whom users can transact business in a secure and apparently seamless environment
Cloud Auditor A party that can conduct independent auditing of the cloud services, information system operation and determine the security of the cloud implementation (NIST definition)
Cloud Broker An entity that manages the use, performance and delivery of cloud services, and negotiates relationships between Cloud Providers and Cloud Consumers (NIST definition)
Cloud Carrier The intermediary that provides connectivity and transport of cloud services between Cloud Providers and Cloud Consumers (NIST definition)
Cloud Service Consumer A person or organization that maintains a business relationship with, and uses service from, Cloud Service Provider (NIST definition)
Cloud Service Provider A person, organization or higher-level system responsible for making a service available to service consumers (NIST definition)
Communications as a Service. (CaaS) Similar paradigm to cloud computing and SaaS, but within the telecommunications environment. Takes advantage of the new distributed models of the next generation telecommunications All-IP networks.
Globally Unique User Identifier (GUID) A unique identifier for a subscriber that is not tied to his/her name, MSISDN, or any other attribute that has the potential to change. 
Identity Federation The process of setting up a cross-domain relationship and the act of requesting, passing and using user-related information across different administrative domains. In this context, federated identity standards define what amounts to an “abstraction layer” over the legacy identity and security environments of these diverse domains. Each domain maps its own local identity and security interfaces and formats to the agreed upon identity federation standards which are to be used externally, without the need to divulge sensitive subscriber data.
Identity Management (IDM)  A set of processes, technologies and services in order to manage principals’ identities (creation, maintenance and termination of principal accounts), secure access to the operator’s resources (data and services) and protect principals’ private data.
Identity Mapping Mapping of identities between different IdPs or between local subsystems.
Identity Provider (IdP) A service which authenticates and asserts a Principal’s identity (Liberty Alliance)
Infrastructure as a Sevice (Iaas) The capability provided to the consumer is to provision processing, storage, networks, and other fundamental computing resources where the consumer is able to deploy and run arbitrary software, which can include operating systems and applications. The consumer does not manage or control the underlying cloud infrastructure but has control over operating systems; storage, deployed applications, and possibly limited control of select networking components (e.g., host firewalls).
Network as a Service (NaaS) It is about opening the network to value added subscriber services, created by third party developers, and charging for the use of the service on a pay as you use basis. It provides services that leverage the power of network-enabled IT utilization.
Platform as a Service (Paas) The capability provided to the consumer is to deploy onto the cloud infrastructure consumer-created or acquired applications created using programming languages and tools supported by the provider. The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, or storage, but has control over the deployed applications and possibly application hosting environment configurations (NIST definition)
Principal A person or “user”, a system entity whose identity can be authenticated (Liberty Alliance)
Service Orchestration Refers to the arrangement, coordination and management of cloud infrastructure to provide different cloud services to meet IT and business requirements.
Single Sign-On (SSO) The Principal’s ability to authenticate with one system entity (Identity Provider) and have that authentication honored by other system entities, often Service Providers (Liberty Alliance). SSO is the ability for a user to authenticate once to a single authentication authority and then access other protected resources without re-authenticating.
Software as a Service (Saas) The capability provided to the consumer is to use the provider’s applications running on a cloud infrastructure. The applications are accessible from various client devices through a thin client interface such as a web browser (e.g., web-based email). The consumer does not manage or control the underlying cloud infrastructure including network, servers, operating systems, storage, or even individual application capabilities, with the possible exception of limited user-specific application configuration settings (NIST definition)
Vertical enterprise Corporations who offer “vertical” services (e.g. healthcare, banking, education)

All opnions expressed here are for educational purposes, and have no representation of any operators or vendor.

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