Cloud & Carrier Routing

Turning Complexity Into Capability

DIGITALK White Paper

...Cloud is the future for carrier routing. Carriers that can see the layers of longterm and short-term benefit will be the ones to take advantage...

www.digitalk.com

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

Ask the right questions to get the best ROI

Cloud is driving profitability, agility and efficiency in carrier interconnect routing and wholesale termination services, ensuring no margin opportunity is lost. From struggling to service new business opportunities to creating new efficiencies, the cloud is giving carriers more options while reducing complexity. The key is to ask the right questions and get the most out of cloud platform providers to maximise ROI. Cloud models are showing that there is a different way forward for players routing their own international and national long distance traffic or offering wholesale voice termination. Cloud can address a lot of carrier routing issues if carriers ask the right questions in their businesses and of their cloud providers.

What are my carrier routing pain points today?

The international voice market accounts for more than 438 billion minutes, according to research firm Telegeography, with strong volume growth being matched with a challenging pricing environment. This means carriers need to revaluate how they approach the market and look at better ways to serve their businesses. Retail operators five to six years ago were using three to four termination providers for 100% of their traffic, today the same operators are using 10-20 termination providers, many of which are niche operators. The number of carrier interconnects wholesale service providers are dealing with can be in the hundreds. More players mean more routes, more rates, and an increasingly fragmented market. Carriers looking to terminate or route voice traffic need to be able to take advantage of new competition that comes with these new players and not lose out on opportunities to grow. The only way carriers can be really successful is when they have the infrastructure in place to support demand and do it efficiently. Keeping costs down while maximising ROI is the mantra but sometimes sounds like an aspiration rather than a reality.

How can cloud improve on the approach weve already got?

When evaluating cloud platforms and deciding if they are right for a business, the common refrain is Why should we change? Weve always done it this way. Carriers have always done it their way and the pain points havent gone away. The market has exploded with new players but the overall approach has stayed largely the same. The pain points of yesterday are still the pain points of today. Carriers need increased capability without extra cost. The end-to-end management of carrier routing with a cloud platform can bring the billing, routing and charging management under one umbrella and allow carriers to focus on growing their businesses. It eliminates the need to procure multiple solutions and hire staff to manage and integrate several different technologies or services. Cloud can cover a full set of carrier requirements with a single complete solution. Consolidated infrastructure on a cloud platform reduces cost of adoption for carriers that otherwise couldnt afford to create their own solution. Capabilities such as wholesale billing and media transcoding require costly support systems and network servers to deploy, but they can be readily enabled as part of a cloud platform. SBC capabilities like interoperability based on SIP and H.323 flexibility, media transcoding, DTMF inter-working can all be part of a cloud solution and solve multiple carrier headaches.

Company name DIGITALK Type of business T  elecoms Platform Provider HQ Location UK Cloud Expertise  Prepaid Consumer Applications and Carrier Cloud Routing and Management Platforms

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

Where operators can spend months evaluating various SBCs, routing platforms, billing and OSS/BSS technologies, then spend further time and cost in attempting to integrate them and work through the teething troubles, the right cloud solution offers these functions pre-integrated and ready for service. When a service is managed in-house and under one roof, there can be a perception of increased control but that can become a fractured environment with multiple vendors feeding into an ecosystem that can be burdensome as well as labour intensive. Wholesale service providers see a fragmented market with increased opportunity matched with increasing complexity. They need complete solutions that meet their needs today.

What will cloud mean to my bottom line?

Cloud services are changing long distance carrier routing because the internet, with broadband access, expanding international network capacity, and the growing number of VoIP interconnect carriers, has created new opportunities to increase service margins and reduce operations costs. A cloud solution for carrier routing means the elimination of capex and the reduction of the number of people needed in order to scale the business and drive profitability. It offers low start-up costs and inclusive platform maintenance, as the cloud partner is able to manage and maintain the service on behalf of the carrier. Cloud users are finding that tasks previously performed by teams of multiple switch engineers, routing analysts and IT engineers can now be managed by one or two administration staff. This takes away the need for large numbers of dedicated staff as well as large upfront investments in on-premises equipment. It also eliminates platform overheads like space, hardware, power, backups, and upgrades, which should be included in the cloud platform. In addition to greater efficiency, there is also an element of risk management. Building a new customer price plan and making sure that it delivers the right level of margin can be a highly complex and time-consuming process. Carriers can use automated solutions to streamline their operations, while providing the margin and quality guarantees necessary to protect their businesses. One way to address that is to be able to create a baseline plan automatically against a number of supplier rate plans, with guaranteed margins. As well as taking cost and margin into consideration, pre-defined QoS policies can be applied to ensure that the right performance is being delivered for each carrier choice. A hosted management solution can help apply rules to mark-up buy price to guarantee margin, add in a QoS plan to guarantee quality, then offer a customer price with minimal time and effort expended. This reduces the responsibility of two departments in a single role with a rapid response to rate changes. Similarly, automated features of a cloud platform can alert the business to new opportunities and issues. Effective alerting of anomalies and trends can keep issues management to a minimum and enable carriers to deliver a better service with less effort. While these features protect the carrier, the pay-per-usage model means no overcharging or unnecessary cost. Whether a carrier is doing 50 million minutes or 500 million minutes, a cloud platform is built to scale with the operation, making it easier for the carrier to do more business and in turn increase profits. It also safeguards the business with burst capacity to manage traffic spikes. Theres a capability to grow with no risk while adding to the business bottom line.

A cloud solution for carrier routing means the elimination of capex and the reduction of the number of people needed in order to scale the business and drive profitability

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

How can I be sure that cloud is right for my business?

There is a tendency to think that cloud is only for carriers that are operationally light and carry low volumes of traffic. Cloud isnt only for smaller players. Larger carriers can benefit from the flexibility and agility of cloud solutions while still delivering high-value and high-quality services. Larger operators are often accustomed to building out their own infrastructure and running services top to bottom. The rationale is that this is necessary to maintain service quality standards and that the value of the capital investment will be recouped in the long term. Extending an already complex infrastructure is a complicated and time-consuming business, soaking up internal effort and external costs. At the same time, markets are now much more dynamic with constantly changing requirements and ever-shortening ROI timescales that can be difficult to achieve with large, long-term capital projects. Often the result is that operators build silo infrastructures to get to market quicker, but resulting in an ever-more costly environment to maintain that ultimately hampers the organisations ability to move quickly. Cloud solutions offer a viable and attractive option, enabling major operators to be as agile and dynamic as much smaller organisations, while retaining their standards for service reliability and quality. Cloud solutions have no impact on current infrastructure but allow players of all sizes to get to market quickly and tap new revenue streams. It enables business units to respond to current and changing market demands without compromising on quality or reliability. As an example, an incumbent carrier can use a cloud solution to introduce a new competitive wholesale termination service entirely managed by their wholesale business unit and capture new revenue in weeks rather than months. The benefits of a cloud solution for larger operators then becomes clear: No or minimal impact on existing infrastructure Rapid time to market for new services Flexibility to meeting changing market requirements Ability to meet the service standards that the business demands Lower business risk with no new capital investment Low operations costs, enabling resources to be devoted to the business opportunity

There is a tendency to think that cloud is only for carriers that are operationally light and carry low volumes of traffic. Cloud isnt only for smaller players

Major carriers will of course continue to maintain their role as infrastructure operators as well as service providers but some have found after using a cloud solution on a single project, the overall perspective on cloud within the business changes. This experience allows cloud to be considered for other opportunities when its utility is apparent and the timing is important, as well as the its low cost of adoption.

Example: Notifications on a low customer balance, falling customer volumes, declining ASR, carrier unavailability or reduced margins, enables account managers and business operations staff to manage issues before they progress or become damaging to the business.

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

What does cloud mean for the availability of services?

Cloud providers should guarantee that all services run on a high availability infrastructure. They shouldnt distinguish between their largest customers and smallest. The infrastructure investments made by cloud providers should benefit all their customers. The level of service availability offered is an important differentiator for cloud providers from the lowest point of entry to the highest. Questions around cloud availability are important because it is essential for a carrier to achieve high levels of availability themselves as they grow their businesses. That is why cloud providers that offer geographic redundancy or geo-redundancy can be powerful technology partners. Beyond using high availability hardware and software, cloud platforms need to be designed to ensure that services will operate if there is a service failure. Cloud providers that utilised separate data centres so that multiple sites are operating with a shared service are in the best position to deliver cloud platforms. Similarly, a cloud provider should guarantee the protection of carriers with secure interfaces between their carrier customers while offering secure access to the platform, and security of customer data held in the cloud. A potential concern with a cloud solution is the lack of access to network features and data that would otherwise be available on a deployed platform. Part of this concern should be addressed by the availability of services supported by the cloud provider (so less low-level access is required), but the reassurance of being able to step in directly when it is required. This includes full access to all CDRs, with the ability to check details of each call. It also includes access to troubleshooting features; such as detailed call trace facilities that might otherwise only be available using third party network probes not applicable on a hosted platform. These features can allow the customer to troubleshoot network and interoperability issues, for example determining that an ASR drop on a route is an issue with 100Rel support between two carriers and not a codec negotiation issue. Detailed tracing filters can provide industry standard Wireshark PCAP network capture files of both signalling and media for sessions matching a specific criteria, enabling rapid identification and resolution of day-to-day interoperability and voice quality issues. Cloud solutions can offer each customer their own unique peering interfaces and IP addresses, ensuring distinction of interconnects between the same termination partners and absolute signalling and media security. Cloud is a driver for greater availability of service for carriers rather than limiting an offering. It all comes down to the provider that is selected. In working with a cloud provider, carriers should demand availability in terms of the infrastructure the provider has in place with the appropriate levels of redundancy as well as the SLAs to back it up.

In working with a cloud provider, carriers should demand availability in terms of the infrastructure the provider has in place with the appropriate levels of redundancy as well as the SLAs to back it up

What is the difference between a managed service and a cloud platform?

This is a question that goes to the heart of cloud. The difference is flexibility and agility. The cloud is a much more active and evolving approach to a service offering. A good cloud solution should be a fully managed service but it shouldnt only be that. It should be able to scale and grow with the business with upgrades and expansion. A cloud service is a service that evolves to deliver better technology and service to the client. It shouldnt be an instance of buying a box and having it managed by an external provider. This isnt about rental of a box or kit. It is about taking advantage of the elastic nature of cloud while also receiving 24x7 support and maintenance.

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

While managed services have a definite role to play in many carriers businesses, the distinction between a cloud service and a managed service is an important one when making a purchasing decision.

What roadmap should be expected for the evolution of cloud services?

Cloud providers should offer frequent upgrades to their platforms. Owning your own equipment is often thought of as offering more control and being less costly in the long term but if a carrier selects a platform that is constantly evolving then there will be a limited need for reinvestment over the long term. Cloud services which share too much infrastructure with a large customer base require the consent and buy-in of all customers prior to an update, stifling the ability to deploy new feature releases. The right cloud solution should be based on a hardware and software architecture that allows customers to benefit from regular feature releases and interoperability fixes without a drawn out release schedule. When the platform is in place, the cloud helps carriers to grow in capability continuously. There have been vendors and solutions on the market that looked like the best solution three to five years ago but have not evolved so arent the best solution today. That is because theyve failed to keep pushing their platform forward. The cloud model is ideal for making the jump from an obsolete platform while ensuring that the adopted platform is futureproof. Cloud is a way to de-risk and futureproof a carriers business. Platform obsolescence is a real concern and there is an opportunity for carriers that are based on legacy TDM infrastructure to use the cloud to make the leap to VoIP. It is the fastest route to market for these carriers and one where their cloud provider has already done the hard work. The de-risking of platform obsolescence should be part of the decision making process for carriers. It is easy to evaluate the explicit costs of the platform today as well as its features but it is what is happening with the technology tomorrow that will lead to long-term benefit.

It is easy to evaluate the explicit costs of the platform today as well as its features but it is what is happening with the technology tomorrow that will lead to long-term benefit

Whats the future of carrier routing and cloud?

The cloud is a natural step forward for carrier routing. The market will see cloud move from a minority platform to a majority over the next three to five years. The impact on international voice will be to reduce long distance termination costs, increase voice quality, and leave more opportunities for value-added service providers. Looking at other industries like enterprise IT, cloud has been fully embraced and innovation in the cloud is excelling. That is a strong indicator of the potential of cloud architecture. Cloud is certainly the future for telcos because it allows them to focus on differentiating their services and customer value rather than on infrastructure, which isnt necessarily where they provide the market with the most value. In addition to the clear benefits of cloud, discounts on switching fees for carriers on the same platform will also hasten the move to cloud. There will be further partnerships between cloud providers and third parties to allow carriers to trade more effectively, publishing and reviewing rates amongst themselves. These are just some of the other benefits of a cloud architecture that carriers wouldnt get if they stuck to an on premises solution. Cloud is the future for carrier routing. Carriers that can see the layers of long-term and short-term benefit will be the ones to take advantage.

Cloud is the future for carrier routing. Carriers that can see the layers of long term and short term benefit will be ones to take advantage

Cloud & Carrier Routing: Turning Complexity Into Capability

DIGITALK White Paper

Cloud Provider Checklist:

10 Questions to Ask a Potential Provider

1. Are you carrier-neutral or are you also operating your own wholesale business? 2. What kinds of fees accompany the platform and the pay per usage model? Are there any hidden fees? 3. Do you offer your own platform technology in the cloud or are you dependent on third party vendors? 4. What is your cloud platforms technology roadmap? How often is your cloud platform upgraded? 5. What level of availability does your cloud platform offer? What level of availability do you get from the very lowest entry point? 6. What service support and SLAs are offered? 7. Can I get detailed diagnostics and call traces so that I can troubleshoot carrier interoperability issues? 8. Do you offer dedicated carrier interfaces so traffic is never shared with other customers? 9. Does your solution support prepaid services as well as postpaid wholesale billing? 10. What else can I do with the service? Do you support integration to a retail services platform in the cloud?

DIGITALK Carrier Cloud

DIGITALKs SBC VoIP Peering solution is now available as the DIGITALK Carrier Cloud, offering you all the benefits of our carrier-grade routing and management platform, without the need to acquire and manage your own equipment. DIGITALK Carrier Cloud enables you to arrange your own carrier agreements, set up your interconnects, determine your services and rates, and configure your own routing plans. You can scale your capacity requirements up and down at will, without having to install or decommission equipment. Not only does that minimise the risk of new market entry, but it also enables a rapid response to increases in demand. cloud.digitalk.com

About DIGITALK DIGITALK is a trusted vendor of Carrier, Consumer and Mobile communications platforms delivered in the cloud or on premises to service providers worldwide. DIGITALK offers complete, highly scalable service delivery solutions with the applications, prepaid charging and integrated management that enable customers to roll out services rapidly and profitably.

For more information please contact info@digitalk.com United Kingdom Brazil Dubai, UAE Germany Italy Singapore USA +44 1908 425000 +55 11 5185 2775 +971 6 598 5473 +49 69 6655 4480 +39 06 54832 130 +65 6866 3770 +1 954 315 3922

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DIGITALK WP Carrier Cloud 1303a

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