For any new company, finding enough bodies to staff the ranks in the initial days is probably the most challenging task.
Just ask Ken Gullicksen, CEO of FiberStreet Inc. (www.fiberstreet.com), a company that was formed in January and is planning to launch managed broadband IP services later this year.
"As a startup, hiring is the most difficult thing to do," he says. "We can't do everything. We have to outsource as much as we can of the stuff that's not necessary to run ourselves."
In the past, that outsourcing might have meant getting consultants to provide network engineering services or relying on contractors for construction.
But Gullicksen is testing out a new model.
He's working with NetworkOSS (www.networkoss.com), an ASP that is offering customers hosted versions of some of the telecom industry's leading OSS software. So, rather than trying to develop proprietary back-office systems or buying licenses to popular software from companies such as Cygent Inc. (www.cygent.com), Daleen Technologies Inc. (www.daleen.com) or Portal Software Inc. (www.portal.com) and trying to integrate them into FiberStreet's existing infrastructure, Gullicksen can rent the functions he needs and let NetworkOSS handle the integration.
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Steve Queroli Chairman and CEO NetworkOSS |
FiberStreet plans to use a hosted billing application from NetworkOSS and is testing four or five other applications, says Steve Queroli, NetworkOSS' chairman and CEO. "There is a need for OSS talent and a need for startups to get into business as quickly as possible and concentrate on their core competencies," says Queroli. OSS issues "can take up so much of their budget and time that they can't get into business right away."
A Matter of Access
In fact, Gullicksen says that with NetworkOSS' help, FiberStreet will be able to start offering services about three or four months sooner than he initially planned. "We can always acquire best of breed ourselves," says Gullicksen. "It was a matter of access to technology."
With its ASP model, NetworkOSS is blazing a new trail, say industry analysts. Although many vendors have tried offering their software on a hosted basis, with varying degrees of success, no single company has emerged that offers a smorgasbord of vendors' products.
That is, until now.
"We haven't seen this happen at all," says Jeanne Schaaf, a senior analyst with Forrester Research Inc. (www.forrester.com). NetworkOSS is "first out in the market."
But Schaaf questions whether providing hosted OSS applications is a sustainable market. "This is very much a niche market--for startups," she notes. "Even though there are something like 1,400 CLECs, how many are likely candidates [for NetworkOSS services]? They basically need to be a greenfield play."
Queroli disagrees. "A lot of people have piece parts done," he says. For instance, because they intuitively know that they need to get paid for the services they're offering, many providers immediately choose some type of billing software and bring that in-house. So if a customer is already using another billing platform, but wants to outsource customer care or provisioning functions, NetworkOSS will work with the customer's billing provider--even if it's not among the vendors with which NetworkOSS has already forged alliances--to integrate all the pieces.
Michael Allen, a senior analyst with Aberdeen Group (www.aberdeen.com), also believes NetworkOSS' approach is not for every provider. Larger CLECs and ILECs are going to want their own systems in place and to be able to control it themselves. But, hosted OSS "has a lot of credibility around smaller CLECs," he notes.
Pressed for Time
Smaller CLECs "are pressed for time," Allen adds. "They need a lot of customers quickly and need to have billing [and other systems], but they don't have revenue to put into the NOC or systems to support it."
That's where NetworkOSS comes in. "If we can provide computing and IT with a service level agreement, [service providers] will get into business quicker," says Queroli. "It's clear that there's a market emerging to provide a complete solution."
Whether it's a full menu of OSS applications or just one or two functions on an a la carte basis, NeworkOSS says it can help fulfill the needs of ICPs, incumbent telcos, cable companies, CLECs, DSL providers, wireless firms, ISPs and convergent carriers.
The OSS needs of these types of carriers have been growing, and are expected to increase exponentially during the next few years. According to Gartner Group (www.gartnergroup.com), companies spent about $1.9 billion on OSS software in 1998. By 2003, Gartner predicts that spending will climb to approximately $4.4 billion.
Wireline companies, such as the ICPs and DSL providers, will be the dominant spenders on IT-related software and services, according to Gartner. Wireline companies will represent about 53 percent of total spending by 2003, with wireless carriers totaling about 22 percent and cable, satellite and ISPs combining for the remaining 25 percent.
Queroli says that the companies most interested in NetworkOSS' hosted applications are broadband players in the United States. "They need service activation, billing, interconnection and inventory," he says, noting that NetworkOSS is working with DSL providers in six markets who are in various stages of deployment.
Queroli also believes that there is great opportunity in Europe and on other continents where competition is still in its nascent stages. Quoting figures from CIBC World Markets (www.cibcwm.com), Queroli notes that 68 percent of OSS dollars are being spent in North America, while Europe represents about 17 percent and the Asia-Pacific rim market represents 9 percent.
Given those numbers, Queroli sees lots of potential for NetworkOSS' "BusinessNow" suite of applications as new competitors spring up in the United States and around the world.
The BusinessNow suite includes a variety of OSS components, including interconnection, billing, customer management, sales force automation, trouble administration, workforce administration, inventory, provisioning, activation and network management.
Offer More Flexibility
NetworkOSS has already assembled a handful of leading OSS solution providers that can be integrated together to create custom solutions for its ASP customers. But Queroli isn't stopping there. He anticipates bringing in many other vendors in order to offer customers more flexibility in developing their back-office systems.
Currently, NetworkOSS can offer solutions that incorporate:
- Cygent's eBusiness Support Systems;
- Daleen Technologies' web-enabled billing, customer management, self-care and service activation solutions;
- DSET Corp.'s (www.dset.com) OSS interconnection platform;
- OpenCon Systems Inc.'s (www.opencon.com) OpenCon Communication Systems (OCS) Billing Mediation Platform;
- Portal's Infranet 6.0 real-time customer management and billing software; and
- Syndesis Ltd.'s (www.syndesis.com) NetProvision automated provisioning software.
- Not only do we need all the categories of OSS functions, but those need to be integrated together," says Queroli. For that, NetworkOSS is relying on the BusinessWare platform for OSS integration from Vitria Technology Inc. (www.vitria.com).
The ASP also has forged alliances with systems integrators, such as BusinessEdge Solutions Inc. (www.businessedge.com), Cap Gemini Ernst & Young (www.capgemini.com) and Datamat (www.datamat.it), an Italian systems integrator. These companies already have created their own packages of OSS solutions and can be called on to perform custom integration for NetworkOSS customers.
Throughout the whole process, NetworkOSS aims to be impartial and help customers select solutions that exactly fit their needs, rather than advocating one company's OSS solution over another.
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VENDOR ALLIANCES |
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BusinessEdge Solutions Inc.--eBusiness integration; |
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Cap Gemini Ernst & Young--systems integration; |
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Cygent Inc.--eBusiness Support Systems; |
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Daleen Technologies Inc.--web-enabled billing, customer management, self-care and service activation solutions; |
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Datamat--systems integration; |
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DSET Corp.--OSS interconnection platform; |
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OpenCon Systems Inc.--OpenCon Communication Systems (OCS) Billing Mediation Platform; |
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Portal Software Inc.--Infranet 6.0 real-time customer management and billing software; and |
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Syndesis Ltd.--NetProvision automated provisioning software. |
"We don't make any money on integrating or pushing one vendor over the next," says Queroli. "But based on some of our volume deals, we might be able to offer better prices or a faster time to market with certain offerings."
Pricing for NetworkOSS' applications varies depending on the complexity of the OSS systems needed by the users. There is an initial upfront implementation fee, which can range from as low as $60,000 for a single simple function to upwards of $500,000 for a complex integration of several OSS functions.
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WORLDWIDE COMMUNICATIONS IT SPENDING IN 2004 |
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Wireline--53 percent |
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Wireless--22 percent |
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Cable/Satellite/ISPs--25 percent |
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Source: Gartner Group (www.gartner.com) |
There is also a monthly fee, which is based on the number of functions NetworkOSS is supporting and the hardware that the customer is using, says Queroli.
Significant Savings
Despite the initial implementation costs and monthly fees, Queroli says there are significant savings for service providers using the ASP model. Over a three-year period, he estimates that a company can save about 42 percent by renting the applications and letting NetworkOSS handle integration and ongoing maintenance vs. owning and maintaining the software on its own. The total cost of ownership includes hardware, software licensing and implementation fees, and maintenance for both the hardware and software.
But savings isn't the only advantage for customers of NetworkOSS, Queroli says. "In general, they're in business a lot quicker too," he adds, so they have an opportunity to see revenue streams and profitability sooner as a result.
For example, for companies seeking OSS for resale or UNE platform (UNE-P), NetworkOSS may need only 30 to 60 days to implement the system. But if the service provider has switches, inventory needs and complex business rules, the implementation process could take as much as 120 days, Queroli says.
NetworkOSS also will provide consulting services for new companies that need help defining their business processes prior to making decisions on the types of OSS functions they need to employ.
As for the delivery of applications, Network OSS has U.S. data centers in Dallas; New York City; and Sunnyvale, Calif., as well as sites in London and Rome. The New York City data center is located on the Internet backbone and the other sites are located in network PoPs in order to minimize the amount of networking requirements necessary to deliver the OSS functions securely via a VPN, says Queroli.
NetworkOSS offers the standard service level assurances, such as connectivity and uptime guarantees. The company also offers more advanced SLAs on the actual business processes, such as guaranteeing the ability to pass orders successfully to the ILECs, says Queroli.
