According to the IDC 2016 Hybrid Cloud report, more than 77% of European enterprises will migrate their services onto the cloud in 2017 or 2018. Globally, the cloud-based transformation of enterprise services is also an inevitable trend. Most people recognize that SaaS cloud services are worth investing in. Huawei MI estimated that by 2020, up to US$200 billion will be invested in SaaS cloud services and enterprise B2B services.
Figure 1 Enterprise transformation to cloud-based services
B2B cloud services create new types of transaction, delivery, integration, and cooperation for enterprises. Compared with the traditional on-premises services, cloud services enjoy more advantages, including:
Cost-efficient: Enterprises do not need to purchase equipment rooms and server hardware at high costs, maximizing the utilization of resources. In addition, no dedicated personnel need to be assigned for service management, which reduces O&M costs.
Easy to use: Networks are centrally deployed and available for customers in all regions. Services are centrally configured, and terminals support plug and play. Enterprises only need to deploy a series of audio and video terminals and applications, without purchasing or deploying on-premises devices.
Easy to integrate: Service systems are also taking a cloud-based transition. With clouds, interconnections between service systems have never been easier. New services can be easily launched and simultaneously accessible to all users.
Secondary development/resale is charged as "pay as you go", with no need of inventory. Enterprise services are more likely to be integrated by industry applications, ensuring in-depth development in the industry.To conclude, cloud-based B2B services have absolute advantages over the traditional server-based services in simplifying IT deployment and management processes, significantly decreasing software and hardware costs, and enabling the efficient use of resources. Users can enjoy services with excellent performance, availability, and security at a greatly reduced cost, providing you with a high return on IT investments. This transformation from enterprise services to cloud services is an obvious choice.
Cloud services are essential in helping enterprises cope with the digital transformation and information and communications technology (ICT) convergence. More importantly, carriers can seize the opportunity to occupy some shares of the B2B market. In the future, enterprise cloud services will not only be cloud services inside a data center but also an end-to-end cloud service for enterprise and industry applications.
Huawei believes that Cloud+X is as an overall strategy for carriers to squeeze into the enterprise B2B service market, that can effectively reshape and promote all enterprise B2B services. This strategy specifically focuses on the connection and communication of a carrier's traditional services and uses the cloud as a unified platform to implement cloud-and-network collaboration. Then ICT–based converged digital services are added to enable "X" services that have unlimited possibilities.
Figure 2 Cloud+X strategy for carriers squeezing into the B2B market
and communications services are rigid demands of the enterprise market. This can be clearly found in the Gartner report released in Q1 of 2017 regarding enterprises' distribution of IT expenditures. Of the total enterprise IT spending, communications services account for more than 40% (see Figure 3). Enterprise connection and communications services are traditionally advantageous services and are also breakthrough points for carriers when expanding into the enterprise market. For example, for BT Global Services (targeting at services of multinational corporations worldwide) of the BT Group, more than 70% of revenue comes from BT Connect (private lines, 37%) and BT One (enterprise communications, 36%). Of the total revenue generated by BT Business & PS services (large-sized enterprises and SMEs in UK and Ireland), connection and communications services generate 50% of revenue. Similarly, for TLF, connection and communications services bring more than 70% of revenue. Therefore, it is recommended that telecom carriers begin implementing the Cloud+X strategy on connection and communications services, then gradually build up all enterprise services.
Figure 3 Enterprise IT expenditure
Industry digitization raises two core requirements for enterprises: digital offices and digital production. The essence of the requirements is that the originally separated enterprise CT (mainly involving enterprise communications services) and IT systems (office and production systems) converge to optimize experience, control costs, and improve efficiency, eventually increasing revenue. It can be concluded that CT services, if embedded into the office and production systems and open to enterprises, can create infinite value.
Integration of CT capabilities into IT systems: If communications are embedded into the office or production systems, communication extends from the background to foreground, from support to production, and from management to enablement, bringing forth various industry-specific applications. Many people have handled some services through a banking client, into which remote video authentication is integrated. The application of CT video communications improves production efficiency while fortifying security.
IT-based transformation of CT functions: With an all-cloud platform architecture, enterprise communications will evolve from on-premises to cloud-based and service-oriented. Services are deployed on the cloud, so enterprises can subscribe to their desired services online and on demand rather than purchasing products that request on-premises deployment. The CT services of public cloud providers perfectly meet these requirements.
Layouts of Major Public Cloud Player: Developing Enterprise Cloud Communication Services and Building One-Stop Platforms for Enterprises
Based on the analysis of strategic layouts for industry-leading public cloud SPs, it is clear that most carriers choose to start from their advantageous services when integrating communication services and developing one-stop enterprise SaaS services. For example, Microsoft integrates the communication services (S4B, CloudPBX, and Teams) in Office365, thereby becoming an all-in-one enterprise SaaS service provider. In the cloud age, enterprises still prefer Microsoft's office systems. Cisco uses their advantages with WebEx and enterprise communications in the on-premises market to expand the collaborative cloud service named Spark. By implementing multi-cloud collaboration in a hybrid cloud, Cisco migrates on-premises applications to the cloud. Alibaba, uses the free IM and VoIP services from DingTalk in office communications to monetize the value through value-added services and ecosystems.
Figure 4 Building one-stop platforms for enterprises
The layouts of these cloud service giants show that enterprise communications is a key SaaS service and all service providers (SPs) will join this course. Meanwhile, the participation of Internet application providers will accelerate the cloud-based development of enterprise communication services and improve the industry as a whole, thus bringing carriers another wave of opportunities.
Facing the demand for ICT convergence requirements, it is difficult for carriers to lead OTT SPs in IT. Carriers must focus on improving CT systems. More importantly, carriers need to build an end-to-end, network-wide, reliable, and reachable PSVN network for basic audio and video services to support an enterprise's requirements for transitioning their traditional voice services to converged audio and video services. Cloud-and-network collaboration will enhance a carrier's core competitiveness.
In the industry, Deutsche Telekom provides bundled services such as video surveillance cloud, bandwidth as a service (BWaaS), conference cloud, and IoT cloud with their network and cloud platforms, all of which generate considerable revenue for the company. Carriers such as Orange and Telefonica are gradually deploying connection and communications services on the clouds, aiming to improve their competitiveness in cloud services and expanding B2B services.
Based on the unified cloud architecture, Huawei's enterprise connection and communications solution helps carriers build an enterprise cloud service platform which is easy to transition to the cloud, open, and convergent, and provides device-pipe-cloud coordination. The solution can also assist carriers in implementing asset-light operations, shortened TTM, efficient and coordinated offices, and multi-service convergence, all of which are innovative practices. Huawei will continue to improve the Cloud+X strategy, to help carriers expand their business into the enterprise B2B market.
Figure 5 Huawei's enterprise connection and communications solution
Huawei has worked with some of the world's leading carriers to effectively provide enterprise B2B services.
China Telecom Guangdong: seven services in one optic fiber network: By constructing an IMS-based enterprise cloud platform, China Telecom in Guangdong has bound their fiber conduit to provide carriers with various services, including cloud auto attendant, cloud videoconferencing, cloud call, enterprise private line, Internet access, virtual private dial-up network (VPDN), and enterprise private cloud. These services not only satisfy the customer requirements for bundled services, but also improve their service ARPU. China Telecom Guangdong plans to implement the cloud-based operations of all enterprise services through basic service hosting, cloud-based platform transformation, opening-up of the system, and by constructing a sustainable B2B ecosystem for carriers.
China Mobile "Video+": China Mobile built a video conference network that centrally provides network-wide services at one site. By combining the cloud platform with the common terminals, China Mobile is able to provide video to the mass market in villages and towns, granting a greater opportunity for the development of video conferencing. Since its commercial use in 2016, cloud videoconferencing has connected thousands of HD video sites, driving the large-scale expansion of private line services. Furthermore, China Mobile integrated a wide array of video application scenarios such as VoLTE, home telepresence, video surveillance, and videoconferencing to construct a basic video switching network and provide industry-leading applications.