B2B growth is coming, but how can CSPs capture it?

According to a recent TM Forum report for telco growth, more than 50% of surveyed (communications service providers) CSPs are optimistic about the growth of B2B revenues in the next five years. New services such as IoT, cloud service, and security are expected to grow fastest, mainly driven by digital transformation requirements from 5G.

Take China, where 5G is developing rapidly, as an example. In the past few years, China Mobile's B2B revenue has grown more than 20% each year, and revenue from new services such as DICT (Data Technology + ICT) grew more than 40% in 2021.

That B2B will bring a new wave of growth in the future has been accepted by most CSPs. As a result, new B2B services may become their new investment focus in the future.

Challenges to expanding B2B business

5G has been reinventing B2B business. For example, CSPs might cooperate with partners to provide combined services with flexible quotations. The pandemic has accelerated the cloudification of applications. Let’s take a glance at what carriers will have to deal with in the new era:

• Service: advanced QoS and SLA
• Order: convergent order management
• Quotation: flexible pricing, quotation and negotiation
• Opportunity: complete opportunity lifecycle
• Lead: visualization of lead management
• Campaign differentiated policy
• Offer flexible bundling, versatile offers
• Cloud native technology

These changes will greatly affect CSPs' IT systems. How should they deal with them?

How CSPs will move forward?

To better support B2B business, Carrier X is focusing on building the "4 Ones" capabilities. With cloud native as the technical foundation and convergent model as the business foundation, Carrier X is building a one-click pre-sales flow (especially the CPQ module), enhancing the one-click subscription flow, and optimizing the one-click post-sales flow.

Targeting cloud native architecture, Carrier X is building hundreds of microservices and common components, trying to enhance the operation intelligence by introducing AI. Additionally, containerization has been adopted to move the applications to cloud.

Regarding the BSS system, one of the major challenges is to bridge the pre-sales and subscription management (how to position CPQ?). Generally, CPQ is considered as an optional part in the pre-sales phase, from the functionality perspective, CPQ relies strongly on the order and offer model in the subscription management. How to choose the portfolio of pre-sales, CPQ, and subscription management?

Let’s see some examples:

China: In a B2B business project for province (branch) A of Carrier L in China, all the modules are provided by vendor H including key modules of pre-sales (lead, opportunity management), CPQ, and subscription management. The project was delivered within eight months at low cost due to the deployment of a pre-integrated solution. This is called Best-of-Suite (BoS).

UK: In a B2B business project for carrier M in the UK, the pre-sales and CPQ are provided by local vendor Y and the subscription management is from vendor H. The project lasted 23 months due to complex data model transformation between CPQ and subscription management (order and offer), as well as dozens of interfaces between CPQ and subscription management (offer dependence, bundle rules, order validation, etc.) The worse thing is the high maintenance cost caused by hundreds of incompatible issues every month. This is called Best-of-Breed

China: B2B business project for province (branch) C of carrier N in China, the pre-sales is from vendor S, the CPQ and subscription management are provided by H. Given CPQ and subscription management are pre-integrated, the focus is to integrate the pre-sales and CPQ which is comparatively simple and standard (less than 5 interfaces), the project is planned to be delivered within 12 months. This is called Best-of-Breed+ (BoB+)

You may think BoS is the best choice, the fact is, we can find many service providers for generic pre-sales capabilities but among them very few can provide carrier-class subscription management (order and offer), because the latter could require many years of experience in the carrier business. Therefore, BoB+ might be a better choice.

Summary

With the rapid growth of B2B services, carriers need to construct or enhance their business support solution portfolio including the pre-sales, CPQ, and subscription management, especially the CPQ part. Considering the model standardization and cost, BoB+ might be a better choice.

On the other hand, cloud-native technologies will be further applied, as the cooperation between carriers and cloud service providers deepens, it’s critical that the platforms can support multi-cloud deployment scenarios through centralized orchestration / management that can seamlessly split and redistribute workloads across multiple clouds.

As President of Huawei Software Business Unit, Maurice Ma manages Huawei's global carrier software unit, including RM, BES&BSS, and VAS. In this role, he is responsible for business planning, strategic investment, solution development, marketing, sales, delivery, and operations of the software unit.