September 2016

Mac Taylor - Editor


SDP Investment Stakeholders

In the beginnings of SDP as architectural element of telecom services layer, investment decisions were the responsibility of the network operations departments and the CTO offices. As stated above, the SDP was deployed as a pure “technology push” with little emphasis on commercial aspects. Too many complex projects and tougher economic times pushed for an SDP investment to be a proven revenue generator, rather than an elegant technical solution for reducing service related OPEX.

Budgeting SDP projects is currently under pressure from business organizations: they require low cost integration and proven revenue streams from new services. This is a difficult test to pass for SDP suppliers, mainly because there is no standardized

Product Lifecycle Management around SDP services that could be easily used to make the integration and revenue generating case. Each operator has its own internal processes and decision criteria in the workflows that create, provision and operate services and resources. While many SDP suppliers have “out of the box” components and applications ready to deploy, introducing an SDP for one or more classes of services into these processes requires intimate knowledge of both the operational environment and the business strategy on the Service Provider side. A generic framework such as TeleManagement Forum’s business and operations processes map (eTOM) is useful to understand the bigger picture but it does not carry the Intellectual Property and Business Intelligence each CSP puts in its own business model.

For the SDP supplier, what seemed to be a technology problem becomes a complex people and processes problem to be solved for each CSP business objectives and “modus operandi”. SDP investments can be driven by solid business cases when better cooperation among the participants in the decision process happens , when they are all committed to understanding both technology and business challenges and can align their resources in making the SDP a joint project across organizations.

Creating SDP Requests for Proposals (RFPs) that reflect such collaboration, rather than just the technology requirements from the CTO architecture team, will signal a more mature understanding of the SDP investment among CSP stakeholders.

These stakeholders inside Service Provider organizations are:

Product Strategy groups

controlling the budgets in collaboration with Product Marketing groups who analyze demand and create new offerings;

IT organisations

whose strategy is led by a CIO office; they have the knowledge of design and operation of SOA-based third generation SDP architectures, CRM and IT service management;

Network organisations

whose strategy is led by a CTO office; they have the control over the network resources and their management. Increased customer expectations, the need for more diversified services and lately the consolidation of multiple lines of business as part of convergence, fuel better collaboration between network and IT organisations on assuring the end-to-end service delivery, correlated on customer experience rather than on assurance operations at network level. Similarly, business organisations collaborate more with technical organisation on understanding the value and the cost of various network and

IT assets, how they can be reused to generate new revenue streams and how to lower the OPEX by outsourcing their management. The changing relationship and relative importance of these three groups of stakeholders in an SDP project may be seen as an obstacle to SDP adoption because it could overly complicate SDP decision making processes. To simplify the decision process and crop long and inefficient projects, several Tier 1 operators (BT and Sprint for example) have recently reorganised and removed the CTO and CIO silos and oriented their business model more around service design from a holistic perspective (market strategy, IT, network) and service delivery from a customer perspective.

For new entrants who have small amounts of network and IT system legacy, the decision process can be simplified although the customer acquisition not the SDP investment is their first priority.

SDP projects, together with broader OSS/ BSS transformation projects, open a big opportunity for suppliers of methodologies and tools to help all these organizations improve collaboration on the whole range of needs: from business analysis and processes modeling down to specifying systems and interfaces to expose required services and evaluate costs of implementation and maintenance. There is a definite lack of such suppliers in the telecom industry and this affects the speed of SDP adoption, too.

November 2016

SDP Investments Drivers

The vast majority of SDP deployments (nearly 80%) surveyed by Moriana have been justified by delivering new services in a time and cost-efficient way. 65% of CSPs have identified the SDP as the only viable solution to reduce OPEX and CAPEX for new services. One, common service architecture can avoid the expenses of developing and operating services in “stove pipes” including the high costs of integrating each new service into legacy platforms and the high OPEX caused by annual maintenance fees on proprietary software and hardware components.

The cost of launching a new “stove-pipe” often exceeds the cost of an SDP and perpetuates vendor lock-in situation. By acknowledging this reality, one in three SDP projects capitalized on the opportunity window opened when a legacy service platform reached its end-of-life.

Not surprisingly then, SDP investments are often perceived as pure “technology push”: within this window of opportunity the SDP is a replacement of obsolete technology; outside this window, an SDP is a new architecture for the services layer meant to future proof against changes in network technologies. 23% of responders in the Moriana SDP Market survey confessed that their SDP investments were a pure “technology push” while 48% stated that their SDP investments were not driven by any concrete business case.

The strategic character of the SDP investment became obvious in the case of leading global MNO organizations such as Vodafone, Orange, T-Mobile, Telenor, 3, as well as regional MNOs such as Mobilkom or Singtel. These operators, running multiple networks, could truly benefit from adopting one harmonized SDP platform across thewhole group. However, in many cases, internal company politics, local interests and market demands combined with technological challenges related to the variety of legacy IT and service platforms deployed across the operator groups, made such SDP deployment decision very difficult if not impossible. Nevertheless, there are good examples of successful SDP deployments on group-wise bases such as Vodafone Live, Orange SNE and MDSP or, on smaller scale, Mobilkom Austria who successfully deployed one SDP platform across the whole group of seven MNOs in Central Europe.

Innovative Tier2/3 operators took a more pragmatic approach adopting service specific SDPs to generate immediate revenue and guarantee quick ROI. The success of mobile messaging and content delivery platforms is proved by a good 10% and sometimes even 25% of the overall ARPU in mature markets, for example the revenue from mobile content in Japan and South Korea. These SDP investments enabled the CSPs to build successful and profitable business models, attracting

Third Party content and service providers in each specific market. In the area of next generation voice services, including VoIP, most of the SDP investments made by Tier 2/3 operators have been based on concrete business cases and this resulted in quicker ROI from these services.

December 2016


Mac Taylor - Editor

Business drivers for SDP adoption

increased customer expectations and appetite for services available on mobile devices and lately on the triple screen: web, TV and mobile; by adopting SDPs for serving such demands, CSPs are enabled to continuously increase the number of content and applications partners who can discover new customer segments among their subscribers while the CSP can combine new offerings through flexible packaging and charging;

increased competition among various categories of Service Providers (mobile vs. fix, telecom vs. cable, entrants vs. incumbents, SaaS and Internet Services Providers vs. network operators) and pressure to compete beyond pricing within the same subscriber base; SDP architectures embedding intellectual property to differentiate in the way CSPs support new business models with exclusive partnerships for services, content or devices and leverage new infrastructure investments are strategies in support of this business driver;

pressure on profit margins which requires greater efficiency in offering new and personalized value services for well targeted subscriber segments at lower costs; services deployed on SDP have higher margins; if correctly exploited, this advantage can compensate the decreasing revenue from voice services which happens in both mature and emergent markets, the former due to substitution with mobile and VoIP over broadband, the latter due to acquire poorer subscriber segments with incentives in free minutes and removal of traditional fees such as roaming across country borders;

the promise made with network focused strategies, specifically the investments in broadband access by attracting the new generation of broadband subscribers with a substantial number of content sources and a “long tail” of services realized at the low additional cost of an SDP when compared with the CAPEX allocated ahead to the broadband technologies (3G, LTE/WiMax, fiber), IMS core network elements or end-to-end IPTV deployments.

Whether it is about creating, faster and at lower cost, the “long-tail” of services for the broadband access or about increasing revenue from specific classes of data services, the SDP proved to be the right investment. The SDP solution strategy survived the challenge of advanced Intelligent Network (IN) platforms, readyto- deploy “stove-pipe” solutions with perceived high market traction and IMS services platforms hype that killed a few SDP projects over the past years.

The SDP is the solution for the CSP services layer to accomplish network and IT capabilities convergence, rapid service composition from reusable components, Third Party access to create new services and support for flexible business models.



October 2016

Mac Taylor - Editor

Inhibitors for SDP market growth

Lack of an eco-system for “ready-to-deploy” services at SDP architectural level, able to bring a quick answer to each CSP expectations: from those seeing the SDP as the vehicle for the next “killer application” to those expecting their SDP to support the “long tail” of services. Finding the application developer and the system integrator who can perform an adequate job within a specified budget and a time-frame remains a challenge; every SDP project is different, the design must meet specific needs of the operator while there is no standard SDP architecture and very few components specified by industry organizations (e.g. some of OMA’s Service Enablers). This is especially true for core telecom voice services or services such as IPTV. For example, the early adopters of voice enabled SDPs faced issues with finding Third Party application developers who could create revenue-generating services while assuring the quality of core telecom services; this type of work is not for “garage” start-ups and requires partners who can guarantee the quality, delivery and future maintenance of such services.

Lack of a standardized and largely adopted framework for CSPs business and operation processes which would include management of SDPs, expanding the value network and enabling new business models. Today, each new service deployed on an SDP must be ”plugged” into existing OSS/BSS infrastructure and its lifecycle integrated through custom solutions, when possible, into business processes such as order management, fulfillment, provisioning, charging and assurance. For this reason, many SDP services are offered for free as part of voice bundles, diminishing the value of the SDP investment. There is no framework for common SDP services lifecycle management and many SDP services do not count as assets for the CSP.

With the exception of TeleManagement Forum’s Service Delivery Framework (SDF) initiative, there aren’t any efforts to show how SDPs enable Network, Device and Service to come together in product offerings and how services can be managed end2end for a rich Customer Experience. Consequently each SDP project requires a complex integration plan preceded by a business consulting stage to explain how the SDP can enrich the current business and operations environment. On the bright side, the rapid adoption of SOA in Telecom for OSS/BSS transformation enables the third generation SDP to be designed around standardized IT architecture which not only facilitates rapid integration but to great extent compensates for the lack of SDP specific standards.

Conflicting Internal Interests

– business organizations who control budgets will support a “stove pipe” solution with proven market traction and coming from a known provider even if it has a higher CAPEX than an SDP-based solution because they must minimize the time-to-market and limit the risks for launching new services. This choice conflicts with the recommendations from CTO office and IT departments seeking long-term advantages from a common SDP architecture and an open framework for service creation. This situation often leads to indecision and unresolved debates that have put many SDP projects into a state of limbo. Moreover, with the push for the broadband strategies, a new conflict between business and operations is looming around monetizing network usage: to invest in platforms that create an intelligent service layer for commercial content and services managed by the CSP or to rely on the abundance of Internet content and “over the top” applications from other providers and increase the revenue generated by their traffic demands?


The Moriana Group Profile


The Moriana Group is an independent organisation specialising in the telecom

service layer and next generation networks. Our focus is on: Service Delivery Platforms, Next

Generation OSS/BSS, Convergent Charging and Billing, IMS, FMC, VoIP, WiMAX, IPTV, Triple Play

Mobile Commerce and Advertising and other key technologies and services.

Our mission is to help network operators and service providers to transform their business models,

service offerings and network infrastructure. Our objective is to enable operators to create new

revenue streams, meet the challenges of the competitive Telecom market. 


The Moriana Group was the first company to offer free Operator Guides in the area of IMS and

SDP. They have reached thousands of industry experts and decision makers and had a significant

impact on these market segments. They proved to be a useful and comprehensive source of

information for operators and provided a high market visibility for the equipment vendors, system

 integrators and software vendors featured in Moriana news and reports.