HomeInsightsTelefónica “needs to change and engage even faster” to realise virtualisation’s benefits

    Telefónica “needs to change and engage even faster” to realise virtualisation’s benefits


    Virtualisation is seen by some as a truly transformative means for operators to best prepare for the future, but a new report has laid out how even the industry’s most enthusiastic proponents are facing difficulties.

    Telefónica’s UNICA virtualisation project has been hailed as “one of the most ambitious and forward looking programmes” using the technology but faces continued difficulty with vendor and technology immaturity, according to a new report from Analysys Mason.

    The paper explores the evolution and future of UNICA, which launched four years ago and is seen as one of the industry’s most impressive virtualisation projects, harnessing software defined networking and network functions virtualisation. It has been deploying UNICA-based infrastructure and services across Germany, Argentina, Colombia and Peru this year.

    The ultimate goal of UNICA is to deliver a fully programmable network, dynamically shifting capacity to meet demand, simplifying the structure of a network and giving operators the ability to deliver services faster.

    The report’s authors write: “Telefόnica was one of the first operators to recognise the potential of changing network architecture to incorporate cloud technologies, general-purpose hardware and a programmable network control plane.”

    However, they say Telefónica needs to overcome issues surrounding market immaturity and the “organisational, cultural and process transformations” needed to take advantage of the technology.

    The report outlines how a lack of vendor support in some cases has been delaying the project. In April Telefónica Group CTO Enrique Blanco told Mobile Europe that “a lack of openness of vendor solutions” had been an ever-present problem since UNICA was launched. He added: “They didn’t want to cannibalise their traditional business.”

    The analysts write: “It should continue to exert pressure on UNICA vendors to live up to their Telefónica’s UNICA architecture strategy for network virtualisation promises and collaborate with one another, and be prepared to bypass them if necessary and build new capabilities itself to ensure it can realise its vision.”

    One means of bypassing vendor reluctance is “vertical virtualisation”, in effect the deployment of virtual network functions that uses the operator’s existing operational processes and existing OSS. Telefónica has done so by deploying virtual EPC in Germany and Spain in partnership with Huawei.

    The report says that while Telefónica has been focusing on the internal transformational change brought about by UNICA, it needs to do more to get external customers involved and enthused. It says: “More emphasis on UNICA’s external benefits will help to maintain internal and external stakeholder interest in and support for its virtualisation initiatives.”

    But even the internal transformational change does not go far enough, the report warns. The operator should also do more to speed up organisational and operational change, the report advised, and bring C-suite executives further into play to ensure targets are met.

    It cited the forthcoming UNICA Centres of Excellence as a potential means of overcoming issues with C-suite buy-in. The centres, comprising a global lab in Spain and a local lab in every opco, will host collaboration on defining and executing UNICA deployments across Telefónica’s markets.

    Analysys Mason says: “The faster the Centre[s are] implemented, the quicker the progress Telefόnica can make towards establishing UNICA across the business.”

    In addition to involving senior managers, the report said Telefónica needs to win support from its commercial arm and educate those staff about UNICA’s potential for new products and services.

    It adds: “At present, UNICA is perceived more as a network transformation programme rather than a service innovation platform. The UNICA platform and strategy, although innovative, will not inspire the rest of the business to develop innovations to drive new service revenue without more effort to educate Telefόnica’s commercial organisations.”

    In a statement, Telefónica says: “This combination of technologies could transform the capabilities and revenue-generating potential of the network.

    Telefónica envisages operating a future network that is fully virtualised and programmable, and which enables the company to cost-efficiently and flexibly align capacity with demand, simplify network complexity and reduce time to market for new service delivery.”

    In order to realise this potential, the industry’s greatest enthusiast of the technology needs to shout even louder to bring the industry along with it.