BSS Applications Managed Services for CSPs

BSS Applications Managed
Services for CSPs
Publication Date: 10 Mar 2016 | Product code: IT0012-000154
Adaora Okeleke

BSS Applications Managed Services for CSPs
Summary
Catalyst
The software-driven infrastructure and operations of communications service providers (CSPs) means
that the network and IT domains cannot remain as separate entities within the CSPs' operating model.
The lines between networks, support systems, and service enablement are blurred, and consequently
there is a wide variety of vendors – network equipment providers, consultancies, SIs, and IT players –
that are increasingly active in the managed services space. This report revisits our research from
2012 to look at the opportunities in the BSS applications managed services domains, and the vendors
that are best placed to capitalize on the current opportunities.
Ovum view
The BSS applications managed services market is currently influenced by CSPs' reconsideration of
existing operating and business models. Business models need to be flexible and agile to respond to
market changes as quickly as required, while operating models need to be automated to improve time
to market and project delivery times. The much talked about digital transformation will demand that
more software, software-as-a-service, and virtualized functions are moved into the core network. As a
result, BSS application-related operations will require a host of new capabilities, such as faster service
design, development, and tear-down; and real-time data processing and analytics. Consequently,
there is a significant opportunity to help CSPs manage their estates more effectively for a wide variety
of vendors ranging from NEPs, BSS software vendors, system integrators, and the pure managed
services providers.
Ovum's research indicates that the market is fiercely competitive with vendors carving a niche for
themselves in the BSS managed services space. Importantly, the vendors that would be the most
successful managed services providers must focus on understanding the CSP's business and its
future objectives, be able to integrate solutions without disrupting operations, and develop and
support mandatory and innovative applications.
Key messages
 Telecoms software and IT systems that support network and business transformation will
provide the platforms for growth and innovation. That is why managed services providers at
the convergence of network domains, IT applications, and systems integration are best
placed to help CSPs with their BSS managed services applications.
 Telecoms expertise and specialization still gives vendors a significant advantage over their
peers.
 IT managed services skills, including business process outsourcing and automation, are
differentiating factors that will need to be part of the BSS applications managed services offer.
 CSPs' application operations (AO) contracts for applications performance and monitoring are
long-term commitments. This will continue to be important as CSPs automate their business
processes and operations associated with products.
 CSPs' application development and management (ADM) contracts can include shorter-term
testing and SI-related engagements, but there is growing demand for application development
© Ovum. All rights reserved. Unauthorized reproduction prohibited. Page 2

and testing – for example, testing in connection with the impact of SDN and NFV on the BSS
(and OSS) is increasingly important.
Managed BSS market overview
Next-generation networks and digital transformations bring new
urgency to the BSS managed services market
The current status of the applications managed services market is a product of the changes CSPs
have to make to their operating and business models. The move to all-IP and high-speed mobile
broadband networks such as LTE means that telecoms networks are dependent on frequent,
automated software changes and fewer, long-term hardware rollouts and manual changes. The
much-needed digital transformation of the CSPs' organizational structure, channels, and delivery
systems will also see more software, software-as-a-service (SaaS), and virtualized functions moving
into the core network. All of these factors mean that telecoms software and IT systems will become
more important as the platforms for growth and innovation.
The software and service-based operations of the twenty-first–century CSPs require:
 faster service design, development, delivery, and tear-down
 real-time data processing and insights
 automated business processes
 end-to-end service assurance and user experience management
 BSS systems that can keep pace with change.
However, the CSPs' overall infrastructure (including data centers) is still complex to maintain and
develop: Legacy, manual, and proprietary systems from multiple vendors are mixed in with new,
automated, and open or standards-based systems. According to one of the directors within
Telefonica's Business Solutions business unit, slow and inflexible BSS is a major limitation to
delivering new services. Consequently, there is a qualified and significant opportunity for a wide
variety of vendors to help CSPs manage their estates more effectively. Beyond the traditional network
domains, CSPs can consider software and IT services companies, such as Atos, IBM, Infosys, and
TCS, with their broad business processes and services skills, which they can bring to bear on
applications operations and applications development and maintenance skills.
When we last reviewed the BSS applications managed services market, there were NEPs, specialist
BSS software companies, SIs, and IT service companies competing. Since then, there has been
consolidation among the product-based software vendors, while software license revenues have
reached a plateau. However, the need for end-to-end solutions, managed by competent IT managed
services providers with deep telecoms knowledge, is strong. The CSPs want vendor-agnostic
capabilities, which means they want those MSPs (managed services providers) that can deliver
vendor-agnostic and technology-agnostic capabilities with the ability to leverage their strong telecoms
expertise in delivering their services. CSPs can look to their NEP partners and BSS specialists to
extend their BSS products and use their platforms for greater support. Companies such as IBM can
provide greater IT expertise, while IT service companies and SIs can capitalize on the lack of clear
standards for interoperability between systems from different vendors.

For the purposes of this report, we are reviewing the BSS applications managed services landscape.
The product areas for BSS map directly on to the revenue opportunities for BSS managed services,
and include:
 billing and charging
 mediation
 partner management
 ordering
 CRM … and, increasingly,
 self-service.
Managed services providers need to be able to do more than operate and monitor billing or CRM
products or BSS platforms. They must develop and test applications that extend the capabilities of
those platforms, and deliver overall business value such as improving customer experience and
loyalty, and manage the customer lifecycle more effectively and efficiently. These activities can be
broadly categorized into the parlance of the IT service companies and outsourcers: applications
support and maintenance (operations) and applications development and testing. For the purposes of
this report, we define the categories for BSS applications managed services as follows:
 Application development and management (ADM). All nonoperational activities related to
the management of BSS applications (design, development, testing, support, training, and
migration/conversion).
 Application operations (AO). All IT oriented operational activities related to the‐
management of BSS applications, such as monitoring and control of IT systems and ongoing
IT support (e.g. mediation operations, prepaid billing operations, postpaid billing operations,
wholesale settlement, roaming clearing).
CSP requirements for BSS applications managed services
In terms of what drives CSPs to adopt applications managed services, the motivation is always to
reduce operating costs and improve business process efficiency. CSPs want managed services
providers to take what they have and do it better by improving the quality of experience (QoE) and
quality of service (QoS) delivered to customers. The benefits CSPs expect from their managed
services agreements in general include to:
 allow them to focus on the core business and free up their own internal resources
 control operating costs via predictable cost structures
 access expertise they do not have in-house
 become more agile in their market response.
The challenges of the managed services contracts is mitigating the commercial risk of sharing
business plans and strategy; ensuring a well-managed transition process and transparent SLAs; and
assuring the customer experience.
Vendor opportunities in the BSS stack
In the past, CSPs would outsource single components of their BSS stack and operations to a single
vendor, but this approach now varies by CSP segment. Tier-2, -3, and -4 CSPs favor an integrated
managed services solution model with a single vendor managing the entire BSS stack and operations.

Tier-1 CSPs still like to manage certain aspects in-house and/or chose best-of-breed vendors for
separate parts of the BSS stack. However, the tier 1s are now also increasingly keen to have a prime
or lead contractor responsible for the entire end-to-end operation.
While billing is business-critical, billing and mediation are areas that CSPs are most willing to
outsource, followed by CRM and ordering. The self-service aspects of customer management are less
likely to be outsourced currently, along with partner settlement, as CSPs see these as key to
competing with over-the-top players through faster services launches and entering other verticals.
CSPs want to retain control of their customer-facing activities because they see these as key ways to
differentiate their service offerings.
Although aspects of CRM were the first to be outsourced, CSPs including BT, EE, and Vodafone have
brought their customer management activities back in-house in an effort to improve customer
experience and quality of service. Beyond frontline customer management, however, CSPs are keen
to learn from managed services providers when it comes to customer lifecycle management and the
business processes and operations behind sales and distribution lifecycles.
Online channels are an effective way to engage with customers. Online self-service and the mobile
and social channels are new enough that CSPs still feel the need to keep them in-house. In Ovum's
opinion, this will need to change. While the value of the customer data and insights is not in doubt –
and clearly something the CSP needs to remain in control of – digital channels and hybrid goods and
services require a good deal more agility, flexibility, and automation of operations (ordering, billing,
and so forth) than we see from CSPs currently. The move to a digital environment (multichannel,
multi-device, including IoT) will present vast ecosystems for CSPs to manage – something that they
will need managed services providers to help deliver. End-to-end outsourcing of CSPs' entire IT estate
and business operations is something that tier-2 and -3 CSPs are more interested in currently; while
tier-1 CSPs are unlikely to take this option in the next five years, they will certainly be giving it serious
consideration in the 5–10-year timeframe.
While we defined application operations (AO) and application development and maintenance (ADM)
for this report, in reality enterprises' requirements and vendor portfolios are not this clean-cut and AO
and ADM overlap. Similar expertise can reside in both areas and issues may be escalated from AO to
ADM. CSPs initially split contracts for AO, ADM, and infrastructure management (data centers) across
different suppliers, depending on the BSS core functionality provided. However, there has been a
consolidation of suppliers for AO and ADM managed services while the infrastructure management is
provided by a different supplier. The drivers influencing the move towards an integrated managed
services provider include: Improved productivity gained by enforcing methodologies, such as DevOps,
and best practices and simplified accountability and governance across BSS managed services
offerings for more streamlined service delivery and service management.
CSPs' AO contracts for applications performance and monitoring are long-term commitments. This will
continue to be important as CSPs automate their business processes and operations associated with
products. This is where the telecoms-focused vendors can excel. Many of the application operation
competencies (e.g. system availability, applications performance, release management, and security)
will take on a renewed level of importance as CSPs virtualize functions and move delivery systems to
the cloud.
ADM engagement can include shorter-term testing and SI-related engagements. Application
maintenance and support generate higher demand from CSPs currently, but demand is building for

application development and testing; for example, testing in connection with the impact of SDN and
NFV on the BSS (and OSS) is one area of consideration for CSPs. Some managed services providers
wrap testing into their ADM portfolios, while others such as Amdocs and Capgemini identify it as a
separate and vendor-agnostic activity.
As the BSS managed services domains have an impact on the IT and network domains, CSPs will
consider two types of strategy when choosing their partners:
 Platform-driven strategy, where network equipment providers (NEPs) or independent
software vendors (ISVs) have their own BSS platforms and are able to manage the
end-to-end product lifecycle. They are able to manage application operations and application
development and maintenance for their own products and, increasingly, for third parties – a
growing demand from their CSP customers. These vendors have their own SI capabilities and
can interface and integrate with other vendors' products. Because of their telecoms expertise
and knowledge of the telecoms network and IT domains, CSPs often favor them as the prime
contractor, and they have responsibility for meeting the overarching contract SLAs, even
where partners provide outsourced elements or business processes. Huawei, for example,
works closely with Tech Mahindra for its BSS ADM managed services.
 Consulting and systems integration (CSI)–driven strategy, where IT service providers
and large professional service companies use their process skills and strategy expertise and
apply it to the telecoms vertical. They may be brought in to transform BSS systems; although
they are properly vendor-agnostic as they do not have their own platforms, they may lack
specialist skills. They may develop new business models and offer performance-based or
SLA-related solutions as a counter to any perceived lack of telecoms expertise.
Competitive landscape
For the purposes of this report, we investigated the portfolios and strategies of BSS applications
managed services providers, which fall into two broad categories.
 Telecoms focused managed services providers: Amdocs, Ericsson, Huawei, and NetCracker‐
 Generalist managed services providers, IT services and systems integration companies:
Accenture, Atos, Capgemini, HP, IBM, Infosys, TCS, and Wipro.
Tech Mahindra still straddles both categories but is edging much closer towards the telecoms-focused
managed services provider category.
These companies have been selected for the scope and scale of their telecoms expertise and their
applications managed services capabilities and market share (see Figure 1). Accenture and HP meet
these criteria but were unable to take part in the research this year; however, we have used Ovum
data sources and estimates to place them on the chart. We excluded smaller players that either only
offer part of the BSS product stack, or focus on their own product suites in their services business,
e.g. Subex or Comarch.

Market positioning
Figure 1: BSS managed services provider position
Source: Ovum
The players profiled in detail below all offer a range of business models including business process
outsourcing, BSS transformations, build-operate-transfer models, and BSS-as-a-service. They offer
vendor agnostic managed services in varying degrees; telecoms-specific players clearly have a‐
greater focus on their own product portfolio. They also offer a full service and support model, which is
where the inherent value of managed services lies.
They have global service centers, regional centers of excellence, and standardized business
processes and support functions, and they offer level-1–4 support. Their global reach and service and
support expertise means 24/7 availability and adherence to contractual SLAs. Importantly, the most
successful managed services providers understand the CSPs' business, integrate solutions without
disrupting operations, and develop and support mandatory and innovative applications.
As shown in Figure 1, the telecoms-focused managed services providers, with the majority providing
their own BSS products as well as services, lead the more general managed services providers in
terms of market share and revenues for BSS managed services. The horizontal axis defines the
vendor's focus on the telecoms industry and we have determined this value based on the proportion
of the vendor's overall revenues that telecoms accounted for in 2014. The vertical axis defines the
market share of each vendor from Ovum's estimated overall BSS MS revenues. The size of the
bubbles is proportional to the BSS MS revenues quoted by each vendor for 2014.
Comparing the results generated from our research this year with that conducted three years ago, the
difference we see in the market positioning of vendors is indicative of CSPs' core focus on working
with MSPs with the ability to combine their network and IT capabilities when delivering BSS managed
services. The NEP and BSS software players providing their own BSS software are leading the

market. Tech Mahindra, without its own BSS software products, is seen to edge closer to the NEP and
BSS players. It continues to strengthen its capabilities in network infrastructure management with its
applications management capabilities with a view to delivering end-to-end solutions.
SWOT comparisons
This SWOT summarizes Ovum's view of the key strengths, weaknesses, opportunities, and threats for
the eleven BSS managed services providers discussed in this report. For more detail, see the
individual profiles.
Table 1: SWOT comparisons of BSS applications managed services players
Company Strengths Weaknesses Opportunities Threats
Amdocs Has its own BSS
platform and is focused
on telecoms vertical.
Broad and deep
expertise in OSS as
well.
Overly reliant on a small
number of large
operators in North
America for revenue
and customers
Acquisition of
Comverse's BSS assets
gives greater richness
to portfolio and greater
geographical reach
Competition from large
NEPs with deeper
pockets, such as
Huawei and
NEC/NetCracker
Strong on complex
transformation projects
Testing and automation
solutions for MS
Six global operations
centers and seven
regional centers
Orbit technology
platform for improving
business KPIs
Atos Strong AO/ADM
offerings, which extends
to infrastructure
Vendor's visibility
outside Europe is
currently limited
Partnership with NEPs
to extend MS
opportunities
Difficult to compete on
price
Broad partner
ecosystem
Differentiated contract
agreements with CSPs
using Atos Bridge
Framework
Vendors with broader
infrastructure portfolios
are potential threats
Strong presence in
Europe
Capgemini Strong in BSS
transformation projects
Limited coverage in the
area of
infrastructure-related
managed services
Strong and growing
testing capabilities
relevant in digital
transformation activities
Competition to intensify
as CSPs focus on their
digital strategies
Broad combination of
telecoms SI expertise in
BSS and OSS
Already offering BSS-as
-a-service
Differentiated strategy
by CSP type
Valuable cross-industry
expertise
Ericsson Long-standing network
domain expertise
CRM activities not as
well developed as
revenue management
MS
Wider adoption of
cloud-based services by
CSPs
Greater demand for
COTS-focused
managed services
offering
Strong portfolio of
CSP-focused products
and E2E market
strategy
Map knowledge of the
network and CSP IT
systems in building its
services roadmap
Well-established global
reach with four global
service centers and 10
regional centers
IT managed services is
a recently formed
separate BU
Huawei Huawei's deep pockets
and R&D give it a strong
advantage
Shut out of lucrative
North American market
Growing SI capabilities Efforts to expand its
enterprise portfolio
could deflect attention
and investment away

from telecoms
Extensive global and
regional support
network
Large scale means it
can take on large
complex products
IBM Large global footprint
with several data
centers around the
world
IBM relies heavily on
revenue from tier-1
CSPs
Use best practice with
tier-1 CSPs to grow
business among tier-2/3
CSPs and MVNOs
Competition has more
strategic partnerships
Lack of a strong BSS
portfolio for CSPs
Competition has more
evenly spread delivery
centers
Infosys MS ability across five
verticals (including
telecoms)
Relies heavily on
business from tier-1
CSPs
Expand upon its tier-2/3
business
Narrow tier-1 focus
hampers new business
development in
fast-moving markets
Big focus on
transformation
Product-agnostic
approach
NetCracker Strong parent company Parent's role in support
is unclear
Analytics included in all
BSS products
Less well-known than its
NEP peers
Own BSS platform &
focused on telecoms
vertical
Relatively weak
messaging around MS
CSPs' digital
transformations provide
new opportunities for
BSS MS contracts
Well-formed
virtualization strategy
TCS Support in 10 verticals
(including
communications)
Relies heavily on
revenue from North
America
Include analytics into all
BSS products (currently
supported on CRM)
Rivals such as NEPs
and BSS software
vendors are well
positioned and have
strategically aligned
themselves with
integration partners
Strong CSP
relationships (90%+
business is repeat
business)
Weak message on
supporting
transformation
Tech Mahindra Deep telecoms
expertise in delivering
network, IT, and
business process
outsourcing activities
Lack of presence in
high growth markets‐
such as Africa and Latin
America
Use its parent
company's presence in
Africa and the Middle
East to strengthen its
positon
Strong competition from
NEPs and BSS software
providers with deep
pockets to develop their
systems integrations
capabilities
Strong and broad
partner ecosystem
Strong focus on
automation will be
essential in improved
customer experience,
including CUBES
intelligent management
platforms
Lost some ground after
integration with Satyam
Wipro Provides end-to-end
services capabilities to
CSPs, covering network
core, IT applications,
and infrastructure
segments
Very limited BSS
managed services
offering in North
America
Use its existing
relationships throughout
North America to
expand its BSS
managed services'
reach
Rival MSPs have
stronger global
presence spread evenly
throughout each region
Strong and broad
partner ecosystem
Limited footprint in Latin
America and Eastern
Europe

Source: Ovum
Vendor profiles
Amdocs
Company overview
Amdocs specializes in software and IT services for CSPs and media companies. Its core products sit
within the OSS, BSS, and CSPs' network-control domains, and nearly all of its contracts include some
form of professional or managed services component. The company splits its activities into two
business areas: products (software licenses for customer management, revenue management,
operations support systems, network control, network optimization, digital lifestyle services, and CES)
and services (consulting, systems integration, managed services, and testing). At the end of its 2014
financial year (ending September 30, 2014), Amdocs reported revenues of $3.6bn, and services
accounted for 97% of its total revenues. It sells few standalone products, with most customers
purchasing a service or maintenance contract with the software.
In 2013, the company formed a separate services unit to encompass its services portfolio; this is now
called the Services Integration and Operations Group, which comprises the following three areas:
 business consulting services for vision and strategy
 systems integration services for transformation and implementation
 managed services for IT process, operations, and infrastructure management, as well as
service delivery management and optimization.
Figure 2: Managed services portfolio
Source: Amdocs
Managed services accounted for 48.5% of Amdocs' total revenue in 2014. The managed service
offering covers four areas of service deployment and optimization of operations:

 IT managed services. Includesapplications operations and applications development
management. This group contains many of Amdocs' BSS applications managed services for
1,500 legacy and third-party applications.
 Order-to-Activation Services (O2A) and Order Gateway. O2A includes BPO solutions
supporting: service delivery operations; process optimization; order issue resolution; and
visibility across multiplay bundles. The Order Gateway offers service providers a flexible, swift
solution that abstracts orders from their original format and streamlines them across systems
and channels. The main use cases for this service are: delivering complex enterprise
services; M&A and consolidation scenarios; and fast integration with new channels, such as
wholesale.
 Testing. Includes automated acceptance testing, systems integration, and E2E testing for
functional areas such as revenue assurance and mobile applications. The offering also
includes BEAT, a software-based, cloud-enabled testing framework that also serves as a
repository of testing methodologies, tools, and best practices.
 Services R&D. Includes the development of new vendor-agnostic solutions and manages
Amdocs' extensive partner program.
BSS managed services
BSS managed services offering
Amdocs' BSS portfolio is part of its broader Customer Experience Solutions and includes:
 Revenue management including real-time billing, online charging, and partner management
 Customer management including customer care (network, social, and proactive care), sales
and ordering (convergent order hub, multichannel self-service, sales quote to order), and
omnichannel care.
 In May 2015, Amdocs acquired Comverse's BSS assets, extending its product portfolio to
Kenan and Comverse One.
Amdocs' IT managed services are composed of business operations management, multivendor
support for applications development and maintenance, and support for optimization of IT and data
center infrastructure. All of these are delivered via the "Truly Global Operation" centers. Amdocs' IT
managed services group supports more than 650 million subscribers worldwide and manages more
than 1,500 legacy and third-party applications.
Vendor-agnostic approach
While managed services are closely tied to Amdocs' BSS and CES portfolios, it does provide
managed services in a multivendor environment, which includes data-center-agnostic capabilities.
Amdocs' move away from micromanaging managed services projects on-site to a centralized global
operations center has helped the company support more multivendor contracts. While it does not
specifically target management of competitor systems, it will do so in the course of a new-build
contract. Multivendor now comprises a sizeable chunk of its managed services revenues.
Business transformation methodology and key capabilities
Amdocs' Truly Global Operation (TGO) is a network with centers worldwide that support and manage
its customers' mission-critical high-volume systems, infrastructure, and processes. The centers offer
24/7 support and guaranteed business continuity, using Amdocs' best practices worldwide and

industry standards such as eTOM, ITIL, CMMI, and ISO. The centers use monitoring tools and
manage Amdocs, legacy, and third-party vendors.
The six Truly Global Operation centers are located in Champaign, Illinois, US; Pune, India; Galilee,
Israel; Montreal, Canada; Sao Paulo, Brazil; and Manila, Philippines. They are connected centers that
work on a central, unified platform and share best practices. In addition to its global hubs, Amdocs has
seven regional service delivery and operational centers; they are located in Melbourne, Australia;
Santiago, Chile; Seattle, Washington, US; Maastricht, Netherlands; Hanoi, Vietnam; London, UK; and
Limassol, Cyprus. All centers offer level-1 and level-2 support and some offer level-3 support,
depending on their location. For larger customers, Amdocs places staff on-site at the CSP's
headquarters.
Amdocs also uses its technology platform, called Orbit, for improving business KPIs via IT
optimization. The foundation of the platform is the Value Mining Engine – an analytic mechanism
designed to measure the customer data against the industry and Amdocs' own benchmarks, and
determine the set of optimization activities needed to provide the customer with the required business
value. The unique IP is vendor-agnostic and enables the connection between technical and business
KPIs in the BSS systems.
Differentiation and client base
Along with the Orbit platform, Amdocs sees its Truly Global Operation as a strong competence to use
for its application operations activities and will support the AO and ADM within its BSS applications
managed services portfolio.
AO includes Amdocs' monitoring capabilities, and the company has a strong link between its product
and operations. Some of the operations are translated automatically to features inside the product
features to reduce the operation cost and increase efficiency. In a non-Amdocs environment, it looks
for ways to translate operations to a business value, again with a view to benefitting overall efficiency
and cost.
In terms of ADM, Amdocs is investing in its testing and fault identification and resolution processes,
which includes everything from level 2 through to level 4. It has a set of unique tools that identifies
pre-event activities and behaviors so that it can anticipate or prevent faults from occurring. Either a
resolution is presented as a user opens a ticket, or preventative measures are taken to ensure the
incident does not occur, or that the user is not aware that the incident has occurred. This is made
possible by automatically reviewing incidents and fixes recorded in the TGO Center and alerting
project teams in case it should happen there too. The information is also taken into the product
development and testing domains to minimize the risk of future defects. When a ticket is opened,
details are recorded in the TGO and the customers are able to see the expertise of the person
handling the fault. Details include type of incident, who opened the ticket, and when and whether they
are trained or certified to address the issues for that service.
Amdocs operates in 80 countries around the world, but North America is by far its largest region,
accounting for 72.7% of its revenue in 2014. It is also home to three of its largest accounts – AT&T,
Sprint, and Bell Canada: AT&T accounted for 33% of Amdocs' 2014 revenue. Emerging markets
accounted for 12% of its 2014 revenue and this share should increase following Amdocs' acquisition
of Comverse's BSS assets.
The company is extending its penetration of global accounts, including Vodafone, Telefonica, and
Deutsche Telekom.

BSS managed services trends
Tier-2 and -3 CSPs are willing to outsource their entire billing (including mediation) and CRM
capabilities, as well as other parts of the BSS (and OSS) to a third party – preferably to a prime
contractor that will assign expert partners if required and take responsibility for all SLAs. The tier 1s
still favor appointing vendors by domains, with end-to-end responsibility by domain. Both types of
CSP want standardized and reusable components and business processes to enable fast service
creation. They also want to see vendors share the risk for AO and ADM, as five-nines
(99.999%)availability and right-first-time delivery are part of most business cases and efforts to
improve user experience. The mean time to repairs, order management, and response rate to
customers remain important customer-facing KPIs.
ADM/AO managed services trends
In the past, Amdocs was criticized for its emphasis on technical perfection and for putting high
numbers of staff on client sites for the duration of its managed services projects. Now the company
has developed the global service delivery and support model that makes it more competitive with its
IT service peers and supports both AO and ADM.
Amdocs is very clear that its testing portfolio and R&D is an area of huge IP and competitive
advantage. Its testing processes are automated at a systems level and, importantly, at a business
level. Many application errors, for example in the CRM, are tightly coupled to business processes, so
it is critical to ensure that faults, resolution, and changes are seen in the context of business and IT
impacts.
SWOT analysis
Strengths
 Amdocs is focused on the telecoms vertical, and is a market leader for BSS with a long
history in managed services. Its revenue management, customer management, and big data
analytics products and solutions play an important role in its managed services portfolio.
 Its Truly Global Operation provides a standardized approach to service delivery and support.
It uses repeatable methodologies and business processes for agile service delivery, as seen
with many larger ICT and professional services companies.
Weaknesses
 Amdocs is heavily reliant on one geographic region and a relatively small number of
accounts. It needs to mitigate its geographical exposure with contracts in other parts of the
world.
Opportunities
 Amdocs' recent acquisition of Comverse's BSS assets will give it access to customers in
high-growth markets in Asia-Pacific and Russia.
 Testing and automation solutions for managed services.
 Orbit technology platform for improving business KPIs through legacy optimization.

Threats
 The telecoms IT and services sector is becoming increasingly crowded with large companies
with deep pockets such as Huawei and NEC/NetCracker. Amdocs may struggle to match their
scope and scale as it chases opportunities.
Atos
Company overview
Atos is an international IT services company with annual revenues of €9.05bn ($9.92bn) recorded in
2014 (a 5.1% increase compared to 2013). It is present in 48 countries and has 85,865 employees.
The company restructured its business units in 2014 and now has four strategic units it refers to as its
Global Service Lines: Managed Services; Consulting and Systems Integration (C&SI); Big Data and
Cyber Security; and Atos Worldline. These Global Service Lines provide services to several industry
sectors: manufacturing; retail; public sector; health; transportation; financial services; energy; and
telecommunications, media, and entertainment.
Atos splits its BSS services offerings for the telecoms, media, and entertainment business into the
following:
 Consulting. Delivers projects to support CSP customers transforming their processes and IT
and improving cost and effectiveness through the use of IT. Consulting practices are split into
business innovation, operational excellence, and IT leadership.
 Project implementation and systems integration. Handles its transformation,
consolidation, and management of CSPs' BSS solutions. Services include greenfield projects,
application upgrades, and replacements, as well as large transformation of the core IT
architecture.
 Application development and maintenance. Includes the maintenance and evolution of
existing BSS systems, including complete lifecycle management.
 Application operations. Provides the management of critical applications providing level-1
and level-2 support services.
 Managed services. This completely covers the operation of IT infrastructure, including
hardware, operating systems, middleware, and BSS applications.
 Business process outsourcing. Through this type of service, Atos manages complete
processes for customers, such as financial transactions in the CSP (payments, voucher
management, electronic top-up), end customers' mail services, or consumer cloud.
 IT outsourcing. These are longer-term contracts which bundle multiple BSS service
offerings; a single ITO engagement could include a combination of ADM, infrastructure
management, SI, and consulting.
From a corporate perspective, Atos is structured across two segments – sales and delivery. From the
sales perspective, Atos is promoting its BSS portfolio as follows:
 The market organization is responsible for the sales and business development and the
service line organization which is responsible for the sustainability of business.
 Both organizations are responsible for certain accounts; market-led accounts are focusing on
growth, while service line–led accounts are focused on upsell and renewals.

From the delivery perspective, Atos has a specific CSP delivery practice and this is split into:
 Consulting and system integration organization. In addition to consulting and systems
integration services, C&SI is responsible for the ADM and AO services as well as testing.
 Managed services organization. This is relevant to the operation of the infrastructure (OS
and the hardware on which the apps run).
Atos's telecommunications, media, and utilities business recorded €1.97bn in revenue in 2014. The
telecommunications sector accounted for €527m with BSS-related services accounting for
approximately 40% of the telecoms revenues. The breakdown of revenues obtained in 2014 is as
follows:
 62% is from the systems integration: These are one-off implementation projects.
 28% is from ADM, AO, and infrastructure managed services: These projects have a multiyear
lifespan.
 10% is from Big Data & Cyber Security and BPO services.
Atos's BSS managed services offering is covered by its IT Outsourcing service (which bundles C&SI,
ADM/AO, and Infrastructure Managed Services). Its subsequent managed service growth has‐
resulted in Atos working with KPN, E Plus, Orange, Maroc Telecom, Du, Telecom Italia, and other‐
customers on managing data centers and operation centers. The biggest of these engagements are
end to end IT agreements.‐ ‐
Atos has a greater profile in offering BSS than OSS ITO services – for example, the 54 different billing
systems (billing engines) managed for KPN.
ADM, AO, and ITO are Atos's flagship offerings. ADM and AO generate the most revenue for its BSS
services organization (e.g. Atos is considered one of the largest independent ADM companies for
Ericsson's BSCS billing systems).
Future development plans
Helping CSP clients align IT with their business objectives remains Atos's focus going forward. The
company sees itself as taking responsibility not just for the improvement of the performance of
infrastructure and applications but for the ownership of the entire chain of the CSP business
processes.
Atos is vendor-agnostic
On the whole, Atos takes a vendor-agnostic approach. The vendor works with a broad portfolio
ofpartners and has set up strategic agreements with key software providers such as Amdocs,
Ericsson, Huawei, Oracle, and SAP.
In February 2012, Atos announced its partnership with Huawei, offering access to its IT and
outsourcing services. Together the companies will offer services to operators that need to replace
legacy IT equipment and systems or want to invest in an MVNE platform for the development of its
wholesale business (e.g. KPN).

Atos indicates that its key capabilities lie in the structure of its global delivery centers, the skillset of its
service professionals, and its strong and broad partner ecosystem. Atos developed global delivery
centers with specific focus on the telecoms sector: It emphasizes that it employs and develops
personnel that have knowledge of telecoms technologies, business processes, and operations.
Working in collaboration with the global delivery centers are competency centers delivering services
for specific CSP software and their related telecoms use cases. These competency centers are
spread across the globe and each supports specific technologies:
 India. Support for billing (e.g. BSCS – Ericsson's billing platform) and CRM applications (e.g.
Microsoft Dynamics, SalesForce.com and Oracle Siebel)
 Poland. Support for billing (e.g. Oracle BRM and BRM/ECE billing), revenue assurance (e.g.
cVidya, WeDo), and e-commerce (Oracle ATG, Hybris, and Opensource)
 France. Supports CRM (e.g. Oracle Siebel and Amdocs Clarify) and billing applications (e.g.
Highdeal)
 Morocco. Supports billing (e.g. BSCS) and testing
 Switzerland. Supports billing (e.g. BSCS) and mediation applications (e.g. Digital Route)
 Spain. Supports billing (e.g. Kenan from Comverse, BSCS from Ericsson), order
management (e.g. Tibco), and OCS
 South Africa. Supports billing and order management applications (e.g. Oracle, Tibco).
Atos also provides a good mix of expertise nearshore, onshore, and offshore to meet customer needs
and remain commercially attractive. While Atos sees the competition going offshore, it believes that
this is not suitable enough to meet the evolving needs of CSP clients as CSPs go through their digital
transformation journeys.
Atos has a huge partnership portfolio in the areas of:
 Billing. Amdocs, Ericsson, Huawei, Oracle
 Business Intelligence and Analytics. Tibco, SAP, Terradata, Oracle
 CRM. Amdocs, Microsoft Dynamics, Oracle, SAP, SalesForce.com
 E-commerce. SAP Hybris, Oracle ATG, Opensource
 Revenue assurance and fraud management. cVidya, WeDo Technologies
 Mediation. DigitalRoute, Oracle.
Atos's current service structure is designed to manage IT environments to improve business process
outcomes. It works jointly with its CSP clients to define specific KPIs in order to measure this
improvement. Taking the business process outcome approach allows the vendor and the CSP to
move away from the satisfaction of IT-related SLAs and focus on the monitoring and measurement of
service-impacting and business-critical KPIs such as service activation time and duration of billing
cycles.
In order to align itself towards achieving business process outcomes, the company has developed the
Atos Bridge framework. Atos Bridge combines all of the vendor's skills in consulting, SI, ADM, and
MS. Atos Bridge strategic monitoring centers deliver a consolidated view of end-to-end business

process chain performance. These centers provide business alerts when agreed business KPIs are at
risk or reaching their threshold. Rather than respond to incidents that are not service-impacting, the
Atos Bridge is monitoring all events and responding adequately. By monitoring these events, Atos
ensures that events do not turn into service-impacting incidents. The occurrence of fewer incidents
means there is less impact on the business.
Atos Bridge has been developed based on best practices obtained from running several ITO projects.
It allows for an improved customer experience with a view to delivering proactive operations. Atos
Bridge helps by being more proactive in avoiding the creation of incidents.
Atos believes that the deployment of Atos Bridge is one of its key differentiators. In addition to its
service monitoring and reporting approach, Atos is able to use Atos Bridge to provide differentiated
contractual agreements to its CSP customers based on flexible commercial models where payments
are in a direct relationship to business benefits delivered to the CSP.
The next step for Atos is to connect the improvement of the business KPIs with business
transformation activities. Transformation needs to consider the evolution of a CSP's BSS landscape in
such a way that an improvement in business performance is achieved. In this case, the vendor's
responsibility during transformation does not end with the system upgrade or installation of new
systems but is linked to the improvement of business KPIs, e.g. achieving shortened service
activation times.
Traditionally, CSPs commenced their managed services activities by outsourcing the single
components of their BSS stack that they considered relatively stable and fully developed. However,
the trend has evolved with CSPs now outsourcing a majority of their BSS applications and operations,
including CRM. To improve total cost of ownership (TCO) and time to market, such outsourcing
activities might include the rationalization of the legacy application environment as well as the
transformation to a new environment. New pricing models might also apply moving investments from
capex to opex.
Revenue assurance and fraud management remain managed in-house as these systems are based
on legacy systems and are directly managed by the business (and not IT), thus mostly not in the
scope of any IT outsourcing activity.
While the vendor expects outsourcing activities to continue, the company indicates that the cloud will
play a critical role as a deployment model. Virtualization of the infrastructure is already taking place,
with the virtualization of the BSS platforms following suit in the next few years to allow for
cost-efficient resource allocation.
However, the vendor does not see all functionalities moving to the cloud. Take billing, for example.
Billing is a differentiator for the CSPs and the capability that they have in the billing space will help
them to create differentiated services to customers in the market. There is also the privacy issue
related to taking customer and billing data outside their data centers.
Atos uses the standard definitions of ADM and AO. Although it has a presence within each category,
more of its business sits within AO. The company sees AO business as being a longer term managed‐
services offering compared with ADM, which consists of its systems integration and consolidation offer
which has a shorter period of engagement with CSPs.

Within ADM, Atos sees demand being high for application testing with the growing discussion around
SDN and NFV. ADM still has a high demand now but this is likely to drop in the next two to five years.
In the AO domain, the vendor sees a high demand for applications performance and monitoring and
expects this high demand to continue. This is due largely to the demand for the high quality of service
that is required for digital services. The demand for manual run-time administration will remain
relatively low as automation begins to take center stage.
SWOT analysis
Strengths
 Atos has a proven track record in the field, with more than 25 years of experience and strong
references in the market worldwide.
 It has a pool of experts available with deep expertise on core CSP business processes and
technologies.
 The Atos Bridge framework and monitoring centers are designed to deliver on business
outcomes over a chain of applications (business KPIs, e.g. service activation time) as
opposed to traditional SLAs which are focused on system monitoring.
 It has a broad partner ecosystem including key software players in the telecoms industry.
Weaknesses
 Atos's visibility outside Europe is limited, which has an impact on its position as a global
provider of BSS managed services.
Opportunities
 Convergence and digital transformation are pushing CSP companies to move away from
legacy applications.
 Partnership with NEPs such as Huawei increases its opportunities to be involved in deals for
end-to-end managed services.
 With Atos Bridge, CSP prospects have the opportunity to enjoy a differentiated contractual
agreement linked to the attainment of specified business outcomes.
Threats
 The BSS managed services market remains fiercely competitive and cost reduction still plays
a critical role.
 Vendors such as IBM with broader scale and expertise in infrastructure management are
threats to Atos's advancement in the end-to-end solution market.
Capgemini
Company overview
Capgemini is a global company with a presence in over 40 countries and employs over 178,500
people worldwide. The company recorded overall annual revenue of €10.6bn in 2014 (a 4.8%
year-on-year increase compared with 2013). Its recent acquisition of iGate enabled Capgemini to
grow its employee base by 24% and strengthen its offshore capabilities.
Telecoms Media and Entertainment (TME) accounted for 8% of Capgemini's annual revenue in 2014.
The company continues to take advantage of its scale as a global provider to work with CSPs in

various regions including Europe and North America. With these customers, it highlights its expertise
in CSP applications, customer experience, testing, and analytics to address CSPs' business and
operational challenges. It focuses its efforts on some primary themes: improved customer experience,
operational efficiencies, and service innovation.
Capgemini's TME sector delivers its CSP BSS offering and these include consulting services,
application services, local professional services, and managed services. Each of these services is
managed by a strategic business unit working with other business units:
 Consulting business unit. It is involved in the BSS transformation domain and has a
practice that is focused on transformation, change management, business process
engineering, simplification, and digitization. A large proportion of Capgemini's work in digital
transformation is provided by the consulting business unit which drives most of the company's
IT service opportunities.
 Application development and maintenance business units. These provide services that
are split across geographies – Apps 1 covers North America and Asia-Pacific and Apps 2
covers mainly Europe.
 Application testing business unit. It provides testing services which are currently offered as
one of Capgemini's offerings to CSPs for BSS managed services. In addition to other
investments, the company's acquisition of Australian company Nu Solutions in 2009
strengthened the vendor's testing capabilities, enabling Capgemini to develop a significant
footprint in the testing area for CSPs.
 Infrastructure management business unit. It delivers infrastructure services to clients.
However, the vendor's core offering is not focused on infrastructure managed services.
Depending on client request, Capgemini is able to deliver a broad range of services based on the
capabilities of these business units. This means that one or several business units can be involved in
specific managed services engagements with CSPs. For example, Capgemini can work on a pure
transformation project of a platform that is fully managed by Amdocs: Amdocs will bring the solution
(product and associated services), while Capgemini provides the consulting expertise to manage the
overall program and align services operations with the business case.
BSS managed services provided by Capgemini include:
 Applications development and maintenance (ADM).
 Application operations.
 Infrastructure management.
 BSS-as-a-service. Capgemini currently provides BSS-as-a-service as a custom project for its
CSP clients. However, the vendor plans to formally roll out this service in partnership with
Oracle. BSS-as-a-service will be a fully managed service that can run on Capgemini's
infrastructure or that of the CSP as a purely private or public cloud offering.
 BSS testing. Testing services are included as a distinct BSS managed service to CSPs. The
testing services help with total cost of ownership (TCO), time to market, and the quality of the
product.

ADM and BSS transformation are Capgemini's flagship BSS managed services businesses, with ADM
being the core of the vendor's offering.
Future development of Capgemini's BSS managed services offerings
In terms of future development of BSS managed services, Capgemini's ADM business will benefit
from planned innovation activities with a specific focus around developing toolsets and capabilities to
effectively manage the application lifecycle. The vendor's infrastructure and testing services will also
benefit from these investments in innovation. Furthermore, Capgemini will continue to evolve its
transformation capabilities with the following as core to its plans:
 Continue to evolve its Communications Transformation Platform to deliver transformation
programs based on customer off-the-shelf (COTS) solutions, as well as enhancing the
existing customer experience management (CEM) library of processes, with a view to
accelerating transformation journeys in line with business needs (not just technology).
 Enhance its digital marketing programs using online channel customer management. The
vendor's work with partners from Silicon Valley such as Twilo, Anaplan, and Frog Design will
be critical at this point.
 Introduce its BSS-as-a-service offering as an accelerator for its transformation projects. With
the as-a-service offering, Capgemini plans to deliver a packaged offer to CSPs'
transformation agendas. For the vendor, the main targets of this new offering would be the
tier-2 and tier-3 CSPs as tier-1 CSP clients would still prefer a dedicated offering that is
hosted on-premise.
Capgemini is vendor-agnostic in its delivery of BSS managed services
Capgemini is vendor-agnostic as it does not have a BSS portfolio of its own but works with key BSS
software providers such as Amdocs and Ericsson.
Capgemini has developed skills in the management of fixed, mobile, and converged services with the
capability of supporting different customer types such as B2B and wholesale. The vendor provides a
framework that delivers a full library of business processes that link to CSPs' customer experience
management initiatives. The framework is considered a huge accelerator for CSPs' CEM programs.
On the transformation side, Capgemini is using its digital transformation capabilities to develop CSP
digital brands that use both mobile and social to enhance front-office operations. Other transformation
capabilities provided by Capgemini include change management, simplification of CSPs' IT
back-office systems, and business alignment management. In addition, the vendor has developed a
new methodology called "Fast and Furious" to support the CSPs' move from their traditional waterfall
process model to more agile processes.
Differentiators and client base
Capgemini sees its BSS assets, such as the Communications Transformation Platform, its integrated
approach to BSS (from business process to secure managed services), and its flexibility to work
within an ecosystem of partners to bring the most effective solution to its CSP clients as its key
differentiators in the BSS managed services market.
Capgemini also has a pool of 8,000 service professionals dedicated to its TME sector. These
employees are located onshore (with localized expertise to support more agile cycles in countries

such as the US, Canada, Brazil, France, Italy, and Germany) and offshore, working closely to perform
all managed operations and transformation services. Its offshore centers of excellence (CoEs) are
located in India (Bangalore and Mumbai) and Morocco to serve French-speaking customers in both
France and Africa. Expertise delivered from these centers includes ADM, infrastructure management,
and testing services. Capgemini sees its combination of both onshore and offshore expertise as a
core differentiator which meets the demands of CSPs requesting the proximity of BSS MSPs to
support differentiated delivery of operations that they consider strategic, such as CRM, self-service,
and order management.
The vendor's client base is dominated by Europe- and North America-based CSPs: Bouygues
Telecom and SFR in France; Telefonica's Spanish operation; AT&T, Charter Communications, and
T-Mobile in the US; and Rogers Communications and SaskTel in Canada.
According to Capgemini, CSPs have traditionally outsourced single components of their BSS stack
and operations to single vendors. However, this trend is changing and will continue to do so in the
future in favor of the integrated managed services solution model with a single vendor managing the
entire BSS stack and operations.
The vendor sees more outsourcing activities taking place for billing and mediation operations.
However, operations such as CRM, partner settlement, ordering, and self-service are less likely to be
outsourced; they tend to remain in-house. CRM and self-service (online customer engagement) are
gradually coming back in-house as a lot of transformation is currently happening in these areas with
the inclusion of digital channels such as mobile and social. With the digitization of CRM and
self-service operations promising CSPs some form of differentiation, a lot of agility and flexibility will
be demanded and so outsourcing these operations may not be a good case to pursue.
Ordering is also another key function that is less likely to be outsourced as CSPs need to compete
effectively with OTT players, launch new services quickly, and enter new vertical markets in B2B.
CSPs need to manage engagements with OTT partners directly and so will usually prefer to keep
partner settlement in-house.
Capgemini's definition of services included in its ADM and AO managed services differs from the
definition used in this report. For example, the vendor delivers its testing services as a separate
offering to CSPs. Its delivery of ADM managed services includes some elements of AO and uses the
same expertise for both services and the functional areas involved. So when specific issues cannot be
managed by AO, these are escalated to its ADM teams. In some cases, the CSP clients are keen on
keeping the AO services in-house as they would like to maintain control of the layer-1 support
activities and maintain control over the applications, while calling on the expertise of the BSS vendor
for layer-2 and layer-3–related support issues.
SWOT analysis
Strengths
 Capgemini's BSS transformation and testing capabilities are core to its BSS managed
services portfolio.
 It has a broad combination of telecoms expertise in BSS and OSS, as well as business
process experience.

 It has a broad partner ecosystem including key software players in the telecoms industry.
 Its cross-industry expertise is valuable to CSPs looking to deliver services to other industry
verticals.
Weaknesses
 Capgemini lacks coverage within the Middle Eastern region.
 Its limited coverage in the area of infrastructure-related managed services limits the possibility
of Capgemini being considered as an integrated BSS managed services provider.
Opportunities
 Testing capabilities will be valuable to CSPs looking at an independent testing services
provider to support end-to-end service quality initiatives.
 The vendor's BSS transformation capabilities will benefit from the current state of activities
with respect to CSP mergers and acquisitions.
Threats
 With CSPs being sensitive to pricing, it would be difficult for Capgemini to compete on price
with the Indian-based vendors that offer lower costs for their services.
Ericsson
Company overview
Ericsson is a leading provider of telecommunications equipment and services, with a corporate
strategy to support a "networked society" combining broadband, mobile, and cloud access. The
vendor claims that its networks manage about 2.5 billion subscribers, served by over 1,000 networks
in more than 180 countries, with more than 40% of the world's mobile traffic passing through Ericsson
networks. In common with its rivals, the company has developed a strong OSS/BSS capability, of
which managed BSS is an important component.
Global Services is responsible for Ericsson's BSS managed services offerings. This business unit
delivers managed services, consulting and systems integration, customer support, and network
rollout. In terms of revenue performance, the Global Services business unit reported sales of
SEK97.7bn ($11.6bn) in 2014, constituting 43% of total company sales.
Managed Services delivers both network and IT managed services. These services have been
structured to include the management of networks, network sharing, and IT. In 2014, the Managed
Services business unit signed 71 contracts (including networks and IT) with net sales of SEK27.2bn.
IT Managed Services manages CSP clients' BSS environment. As operator confidence grew about
Ericsson's demonstrated capabilities to manage operators' networks, the vendor began to gain
ownership of the management of OSS systems and then BSS systems. The evolution of its BSS
managed services commenced with the management of its proprietary systems and has advanced to
include nonproprietary systems.
Ericsson's BSS managed service offerings span BPO, AO, and cloud
Ericsson's managed services offerings have been structured to include four main options:

 Business process operations. Ericsson takes over the business process responsibility from
the customer. This is also called back-office outsourcing and it includes internal business
functions such as billing.
 Application operations. Ericsson manages its own and third-party applications for evolution
and change requests in relation to the business processes involved. Systems operated
include OSS, BSS, and enterprise support systems (ESS).
 Data center and cloud operations. Data center operationscover activities and services that
support a smooth-running data center and include hosting, management and maintenance,
upgrading servers, and backing. Cloud operations include operations associated with
software tools, virtualization, resource allocation, tracking, and security.
 Managed cloud services (MCS). MCS includes a broad range of services which can be
delivered from the operator's data center or its own data centers. MCS will include Ericsson's
data center and cloud operations.
Ericsson's flagship BSS managed services are its AO offerings in the revenue management, billing,
and charging domains. The vendor sees the highest proportion of its earnings and more ongoing
deals for managed services in these domains. Self-care and CRM account for a lower proportion.
Ericsson's focus is to continue to develop its end-to-end service assurance capabilities. This involves
enhancing capabilities that empower customers to control not only the services offered to customers
but the quality of the service delivered at every point in time. The vendor believes that the move of
managed services offerings from the management of systems to the management of services
end-to-end is essential to CSPs achieving a consistent customer experience and this has to be
maintained through the lifecycle of existing customer interactions.
Ericsson says that all its managed BSS services and all of its managed services offerings are fully
vendor-agnostic.
Ericsson counts skilled personnel and a global reach among its key strengths. With more than 65,000
service professionals globally, it has the experience of managing advanced SI/IT projects and also
has multivendor experience, using a mix of local knowledge and global expertise. It does this from
four global service centers (GSCs), which are based in China, India, Mexico, and Romania, and
several regional centers. Ericsson's service professionals possess skillsets related to solutions
provided by the key market leaders.
Ericsson's strongest assets in the delivery of its managed services processes are:
 Managed Services Technical Operations Procedure (MSTOP) processes. To support its
move from a network-only managed services framework to one which controls the end-to-end
delivery of services, Ericsson developed MSTOP as an internal process that is
service-oriented and is an evolution of the eTOM processes which combines iTILv3. The
company says MSTOP has allowed it to transform its processes from being network-oriented
to being service-oriented and it will also change the supporting tools and clarify and modify
the rules of responsibility in order to improve accountability.
 Managed Services Delivery Platform (MSDP). A single network operations platform across
the vendor's global Managed Services organization, MSDP is a portfolio of tools that enables

the operation of a communications network, both locally and from remote operation centers.
The vendor claims that more than 38,000 people have been trained in the use of MSDP. With
this platform, Ericsson is able to monitor and control the service KPIs in addition to the
traditional KPIs (system KPIs). It claims that MSDP is a strong differentiator in the BSS
managed services market.
Ericsson also highlighted that, in addition to the traditional technical KPIs, its service-related KPIs
allow the company to control the end-to-end quality of customers' key processes.
CSPs are willing to outsource BSS operations such as billing, mediation, CRM, self-service, revenue
management, and partner settlement. However, due to the interconnection that exists between BSS
operations, Ericsson indicated that CSPs would usually outsource these interlinked operations to a
single managed services provider; for example, billing, mediation, ordering, and revenue management
would go to one managed services provider while CRM and self-service would go to another.
According to Ericsson, there are certain domains like fraud management that are still managed
internally by CSPs. The level of commitment and liability demanded for the management of these
systems is very high and so makes it very difficult to manage as an outsourced activity. CSP C-level
executives are not yet confident enough to outsource such legally critical operations to an MSP and
so choose to retain these operations in-house.
In the future, the CSPs' appetite for outsourcing will remain the same. However, managed services
offerings could evolve towards the cloud with managed services operations being delivered as a cloud
offering. However, the move is expected to use the cloud's cost-effectiveness to manage the
lowest-priority customers; for example, the companies with mainly prepaid customers will move to
billing as a service for the few postpaid customers that they have. However, for operations such as
fraud management that have legal interceptions (due to legal restrictions within the country of
operations), outsourcing will be restricted.
Revenue management and billing and mediation are the BSS areas where Ericsson sees the highest
proportion of its earnings and where it has the most ongoing deals for managed services, while
self-service and CRM account for a lower proportion.
Ericsson applies the same strategies, processes, and tools to all tiers of CSP clients. However, the
project scope defined for both classes of CSPs differ due to their varying rates of adoption for newer
technologies. Tier-2 and -3 CSPs are more willing to go for full outsourcing of the entire end-to-end
service assurance or customer experience and are often the first movers for new technologies and
processes (e.g. adoption of the cloud). They are willing to go for a single provider and then
complement the core system with cloud services from other providers. In contrast, tier-1 CSPs tend to
be more conservative in making this adoption.
Ericsson's definition of ADM and AO managed services aligns with that used in this report. The vendor
indicated that its ADM offering is growing at a faster rate. As Ericsson's network managed services
offerings progressed, engagements began to evolve to include the management of BSS and OSS
application operations as well. As a result, Ericsson has built expertise and activities in AO before
moving into ADM managed services.

Ericsson expects the demand for application development, maintenance, and support to remain high.
The demand for application testing will remain medium but will intensify in the next five years.
SWOT analysis
Strengths
 Ericsson has a strong portfolio of CSP-focused products – BSS, OSS, and network
equipment with a well-rounded and long experience in the telecoms industry.
 It has a well-established global reach with four global service centers and several regional
centers.
 It has a large pool of expertise including product development, systems integration, and
managed services with over 65,000 service professionals to deliver managed services to
clients.
Weaknesses
 Ericsson has limited capabilities in the CRM space, which restricts its ability to deliver full BSS
managed services offerings without relying on third parties to fill the gap.
 Concentrating too much on an end-to-end go-to-market strategy could limit its reach in the
market.
Opportunities
 The wider adoption of cloud-based services could benefit Ericsson as it develops its cloud
offerings for both IT infrastructure and OSS/BSS.
 Ericsson can map its knowledge of the network and CSP IT systems in building its roadmap
and enhancing its managed services offerings.
Threats
 The greater demand for COTS-focused managed services offerings could contract Ericsson's
current client base. This could be averted through the development of partnerships with an
open source ecosystem.
 It needs to bolster its ICT or IT services credentials.
Huawei
Company overview
Huawei is a $46.5bn company (2014) and comprises four divisions (see also Figure 3):
 Product s & Solutions. A newly established business group designed to sharpen its
competitive edge in products and solutions by making full use of the competitive advantages
of its integrated ICT portfolio and deliver a better user experience. The Carrier Software
Business Unit, which contains the OSS, BSS, and CRM assets, is part of this group.
 Carrier Business Group (BG). This business group is focused on fixed and wireless and
core network infrastructure and services. This is the largest BG, accounting for approximately
$30.9bn in 2014.
 Enterprise BG. This BG is focused on enterprise network infrastructure, cloud-based data
centers, information security, unified communications, and collaboration for industry verticals
such as government.

 Consumer BG. This BG is focused on smartphones, mobile broadband devices, and home
devices for consumers and enterprises, and applications for the devices.
Huawei has disrupted many telecoms markets since it started expanding overseas in the late 1990s,
and it has invested heavily in its services division. This investment has paid off. Ovum estimates that
services accounted for about one-third of Huawei's Carrier Networks revenues in 2014, and its
revenue is growing at around 20% per year.
Figure 3: Huawei's corporate governance structure
Source: Huawei, 2015
Huawei's BSS managed services sit within the Carrier Software Business Unit of the Product &
Solutions division. The BSS MS service business is structured and managed across two axes – by
portfolio and by business model or service:
 The portfolio includes: IN/OCS-based Managed Services; NGBSS Full Stack Managed
Services; and CBS Managed Services.
 The BSS managed services are based on the following business models: full services
management; augmented support for operations and assistance; managed capacity model;
hosting / private cloud model; revenue share / as-a-service model; build, operate, and transfer
model (under managed transformation).
Huawei's service catalog includes the following BSS managed services:

 Business Operations Support (business process outsourcing with focus on market
management, customer management, and revenue management)
 Service Quality Management (complementing CSP CEM initiatives through business process
quality management)
 Application management and development
 Application operations
 Infrastructure management
 Security management (focusing on business risk management, business continuity, and
disaster recovery services).
Huawei identifies BSS applications management and BSS infrastructure management as its flagship
offers, and particularly for its OCS/IN/billing portfolio. In terms of developing its BSS managed
services capabilities, Huawei intends to deepen and expand the capabilities and geographical
coverage of its Centers of Excellence, add to its library of tools and methodologies based on project
experience, and invest in R&D, targeting an integrated service portfolio. For example, the company
wants to improve its customer experience management offers (including marketing, customer care,
and revenue protection), its big data analytics operations services, and its multivendor cloud BSS
management and orchestration. It also has projects under way to improve its capabilities and tools for
agile application development management, BSS application and infrastructure operations automation
management, BSS service quality management (for IT enabling customer experience), and BSS
business process outsourcing.
Huawei is able to operate in a multivendor environment. For example, it has won contracts with
Telefonica in Latin America which clearly demonstrate its BSS applications operations and
infrastructure management credentials. However, it does need to call on SI partners to assist with
applications development and maintenance. Its capabilities are linked to its own products (BSS
Business Process Outsourcing, Application Management and Development, and Security
Management), but its joint alliance partner engagement models are increasingly about its reach and
success. The company is an active contributor to the TM Forum's eTOM framework and it is
increasingly working to standardize its solutions, interfaces, frameworks, and business practices.
Huawei is acknowledged as one of very few companies with the scale and resources to support very
large and complex projects across core and access networks, OSS/BSS, and value-added services.
For BSS Managed Services, Huawei has:
 Four Global Operations Delivery Centers: Egypt, India , Malaysia, and Romania
 Four Global Technical Assistance Centers: China, Egypt, Mexico, and Romania
 15 Managed Services Support Centers across Africa, Asia, Europe, Latin America, and the
Middle East.
In addition, the company has global resource centers in China, UAE (Dubai), India, and Malaysia, and
15 regional centers supporting cross-IT and network products and technology. There is also a
three-tier organization (global, regional, and local presence) for service delivery management and
governance, and over 500 business analysts and solutions architects who work with CSP customers.

Huawei has also established a new Business Management Office in the UK as a part of its ongoing
focus to deliver richer business services such as business transformation management, business
process definition, and business requirement management – all part of its value-added engagement
with CSPs' business functions.
Many of Huawei's BSS customers also buy network infrastructure from the vendor, and the company
has managed services relationships with over 120 operators across 75 countries. Its BSS managed
services go-to-market strategy identifies four tiers of CSPs: Tiers 1 and 2 are the global and
multiregional operators; tier-3 and -4 operators are primarily subregional or based in one country.
In terms of differentiating its overall offer, Huawei has a strong complementary OSS portfolio and it
continues to invest in BSS products and services solutions frameworks, including ROADS-based (real
time, on-demand, all online, DIY, and social) customer experience CRM/BSS, and big data analytics
professional services. It is expanding the value of its managed services offering by including hosting
and cloud business models, and continuing to invest in alliance partnerships with marquee ISVs and
professional services firms to provide strong multivendor BSS service capabilities.
From Huawei's perspective, the main drivers for CSPs to use BSS managed services are to manage
capex and opex, manage complexity, reduce risk, and reduce time to market. Other important factors
include improving revenue and customer management processes, enhancing IT operations, and
effectively supporting new initiatives such as enterprise business offerings and the adoption of
industry frameworks and best practices.
CSPs increasingly favor integrated solutions from a single supplier, especially for BSS transformation
projects. However, they are not yet ready to hand over the entire stack. CSPs are willing to use a
trusted partner for IN/billing operations and maintenance, improving product and service development
of order management and service assurance solutions, mediation, and rapid BSS transformation
projects. However, the trends still show that CSPs retain responsibility for revenue and fraud
management business processes (i.e. partner settlement, auditing, and compliance).
Huawei's definitions of ADM/AO are broadly similar to those used in the report. They also include
maintenance of applications under its support in the ADM definition as a means to provide holistic
value to CSPs.
All of its BSS managed services contracts include an application operations offering, and it finds that
CSPs' RFPs increasingly require multivendor BSS managed services. In terms of ADM, Huawei's
capabilities are more closely tied to itsown BSS/NGBSS stack, and it works currently with SI partners
(for example, Accenture and Cognizant) to assist with multivendor engagements.
Huawei continues investing in its own multivendor capabilities as opportunities increase with CSPs
looking for digital transformation opportunities.
SWOT analysis
Strengths
 Huawei has financial resources and a growing skills base as well as a reputation for handling
large-scale, complex product deployments, and managed services contracts.

 Its skills base traverses the network, IT applications, and SI domains.
Weaknesses
 Huawei has limited multivendor expertise in ADM, where managed services are closely tied to
its own product expertise.
 Its customer management applications are less well developed compared with its billing and
mediation capabilities.
Opportunities
 Although Huawei is not present in North America, outside this region, it has proven its ability
to scale into new markets and take on very large projects. It continues to have success with
tier-2 and -3 CSPs, especially in Africa and the Middle East.
 It is active in the TM Forum and other bodies and forums related to services.
Threats
 While technically highly competent, Huawei needs to improve its business operations
capabilities.
 It is still a small player in IT services and the applications management space and requires
partnerships and joint ventures to succeed in the services market.
IBM
Company overview
IBM is a publiclytraded IT player with total revenue of $92.8bn in 2014. It has a global footprint with
offices in over 170 countries, including six service centers, 36 delivery centers, and two services
integration hubs.
IBM is split into a number of business units, with BSS managed services being provided through two
units which comprise Global Services:
 Global Business Services (GBS)
 Global Technology Services (GTS).
The GBS business unit provides professional strategy consulting, application development and
innovation (AD&I) services, application management services (AMS), and outsourcing services across
applications and business processes. Sitting within the GBS business unit is Global Process Services
(GPS), which includes strategic business process outsourcing services in the areas of finance, HR,
procurement, supply chain, marketing, and lending. GPS uses the strategy consulting services of
GBS to deliver a "consult-to-operate" value proposition to drive business outcomes for its clients.
Within the GTS business unit, IBM provides IT outsourcing services to transform CSP data-center
infrastructures. This includes service management, technology, and industry applications with new
technologies such as cloud computing and virtualization.
Both GBS and GTS are responsible for the worldwide delivery of IBM's managed services. These
delivery capabilities are available to clients through delivery centers in over 40 countries worldwide.

IBM provides a wide array of managed services for BSS including support for digital transformation,
systems integration, application development and innovation (AD&I), application management (AMS),
global testing, MobileFirst solutions, cloud enablement, global process services (GPS), and IT
operations outsourcing.
IBM's flagship managed services offerings for BSS are digital transformation, application
management, global process services, and IT managed services.
IBM does not own any BSS products and thus takes a vendor-agnostic approach to deliver BSS
services to its managed services customers.
IBM considers itself skilled in the art of CSP business transformation and has seen an increase in
requests from CSPs looking to adapt to the new digital standards of the industry. In addition to
assisting CSPs with this task, IBM helps CSPs to reengineer their BSS portfolio and will assist with
selecting products and solutions that best meet the CSPs' new business needs. IBM will host these
new solutions as a managed service. Typical requests from CSPs pertain to improving the
omnichannel customer management strategy, billing, and online charging.
IBM also provides business transformation services for CSPs in areas such as order management,
HR operations, and marketing that drive cost reduction and agility for CSPs. It offers managed
telecoms analytics services to generate business insights and managed marketing services to drive
greater marketing results through the execution of digital campaigns. Customer-care and front-office
managed services are offered through a strategic partnership with Concentrix.
IBM works with a wide range of service providers across the globe but has a strong partnership with
tier-1 CSPs, deriving the majority of its BSS managed services revenue from tier-1 relationships.
IBM believes that it offers a number of capabilities that differentiate it from the competition. In addition
to offering traditional managed services, IBM also offers co-managed services. As a part of the
co-managed services offering, IBM works closely with CSPs to provide guidance and consulting in
addition to the standard managed services. With this model, the client retains overall management of
staff, while benefiting from an infusion of skills, tools, and processes from IBM, an experienced
strategic provider.
Aside from the co-managed services offering, IBM also believes that its global reach, centers of
competence, IBM Interactive, IBM Design Thinking, business partner alliance, and industry expertise
– among other qualities – allows it to differentiate its offering.
IBM believes that CSPs have generally been and will continue to be motivated by cost savings when
considering investing in managed services. In addition to outsourcing billing and CRM, CSPs have
also been willing to outsource their finance and accounting, supply chain, and marketing operations.

While billing and CRM tend to account for the largest portion of IBM's BSS managed services, over
the past few years it has seen an increase in uptake by CSPs looking to consolidate vendors and
outsource billing and CRM systems.
IBM sees demand for ADM services such as application development and application maintenance as
high and expects it to continue to be so over the next five years. It only expects a small demand for
application testing and support over the next five years.
SWOT analysis
Strengths
 IBM offers a wide array of managed services including BSS, OSS, and ERP.
 It has a large global footprint with several data centers in each region of the world, giving it
nearshoring and offshoring capabilities.
Weaknesses
 IBM relies heavily on revenue from tier-1 CSPs.
 It suffers from the lack of a core BSS portfolio.
 Its managed services portfolio is segmented into two business units.
Opportunities
 IBM could use its best practices with tier-1 CSPs to grow business among tier-2/3 CSPs and
MVNOs.
Threats
 IBM's competitors have more evenly spread delivery centers.
 They also have a more complete product portfolio.
Infosys
Company overview
Infosys is a global consulting, technology, and outsourcing player with total revenue of $8.7bn in its
last financial year. It has a global footprint with 85 offices and 100 nearshore and offshore
development centers around the world and approximately 176,000 employees. Infosys's focus is on
major vertical industry segments: financial services, insurance, healthcare, life sciences,
manufacturing, retail, consumer packaged goods, logistics, energy, utilities, communications, and
services. The communications vertical is a big one within Infosys, accounting for $1bn in the last
financial year (around 11% of the total). Infosys helps CSPs by addressing challenges in three key
areas: business transformation, accelerating innovation, and running efficient operations.
Within the communications industry vertical, the business is split into seven key offerings (see also
Figure 4):
 Applications Development and Management
 Business Process Services
 Cloud, Infrastructure, and Security
 Consulting and Business Technology Transformation

 Digital
 Managed Independent Testing
 Engineering, Platforms, and Products.
Infosys does not break out the revenue split between these seven horizontal areas for the
communications vertical, but it does break them out for the business as a whole: Consulting and
Business Technology Transformation accounted for approximately 31% of the total revenue in the
year ending March 31, 2015; Business IT services accounted for approximately 63%; and Products &
Platforms for approximately 6%.
BSS managed services offerings fall within all of the above horizontals. Infosys launched its
communications managed services business in 1999 and is working now with leading service
providers in three geographical units (Americas, Europe and Asia-Pacific, and Middle East and Africa).
Figure 4: Infosys has structured its industry services across its key service lines
Source: Infosys
Infosys's BSS managed services offering includes:
 Applications Development and Management. This includes a combination of application
development, modernization, support, and application operations. It accounts for more than
50% of Infosys's BSS managed services revenue.
 Business Process Services. These are the specialized CSP operations, such as order to
cash, assurance services, and managed networks, as well as process transformation services

to help CSPs to achieve industry benchmarked levels of their operations across wireless,
wireline, and cable.
 Managed Independent Testing. This is the set-up and operations of a specialized CSP BSS
testing center of excellence; it includes providing reusable testing scenarios for automation,
tools, and IP.
 Transformation. BSS transformation represents a big part of Infosys's BSS managed
services business. The company focuses on providing a best-of-breed strategy for its BSS
transformation strategy using its Digital, Cloud, Infrastructure, and Engineering service lines.
Infosys offers several flagship BSS offerings as a part of its managed services portfolio, specifically:
 Customer experience management: self-service, omnichannel transformation, API
management
 BSS-as-a-Service: BSS cloud solutions
 COTS ADM and technology modernization
 Innovation with open source: NoSQL, BPM-based order management, self-service, etc.
 Go-to-market solutions with partner clients
 Automation: E2E billing, testing, and migration automation platforms
 Living labs: pre-integrated solutions and accelerators.
Product- and vendor-agnostic approach
Infosys takes a product- and vendor-agnostic approach. It believes that, by focusing on and
understanding the evolving business requirements of its customers, it can propose a "right-fit
strategy." This allows Infosys to determine whether commercially available products, including open
source, will best suit a CSP's needs or if it requires something more custom to be built in-house.
Infosys has a BSS transformation strategy focused around providing service, value, and differentiation
to its customers. The managed services provider focuses on providing best-of-breed components in
its BSS stack, which are designed to address new services and emerging trends (such as LTE,
M2M/IoT, multinational delivery, and cloud). Furthermore, it helps CSPs monetize APIs, simplify
processes and operations for CSP operation and IT transformation, and helps to ensure a faster
launch time.
Infosys believes that its expertise regarding leading market products and other areas – including open
source innovation, renewed alliances and partnerships, and cloud architectures – has helped it
become a leading provider of BSS transformation. Infosys claims to have completed BSS
transformation projects in all of the major regions of the world.
Infosys currently has around 16,000 experts in more than 50 countries, in 85 centers, to assist its
client base of over 60 CSPs. It highlights its depth in product expertise, its global footprint, and its
overall agility in adopting new technology and trends as some of its key differentiating factors.
Specifically, Infosys feels that its 85 centers in more than 50 countries provide it with the nearshore
capabilities to quickly service and build on its relationships with its clients. The company believes that

its balance of expertise in the telecoms domain and the leading market products makes it a market
differentiator.
Its strategy for working in the market includes building strategic long-term relationships and growing
business from those core clients. While Infosys has mainly focused on tier-1 CSPs in the past, it has
recently added many tier-2/3 relationships and believes it can add considerable value and agility to
these operators. Infosys believes operators want a partnership approach.
Infosys has identified that the shift to digital services has drastically shaped the requirements for
CSPs when selecting a managed services provider. Although areas such as billing, mediation, and
fraud management are steady areas of business for Infosys, it has not seen an increase in demand
from CSPs for managed services in these areas. It is important to note that, while the demand for
billing has not dramatically increased, this is Infosys's leading area for managed services adoption;
currently about 40% of CSPs have adopted it as a managed service. The uptake of self-service
follows behind billing at 39%, ordering at 38%, and CRM at 37%.
Application development and management represents nearly 50% of Infosys's overall managed
services revenue. Currently, the demand for ADM is high, particularly in the areas of application
development and testing, and Infosys expects to see the high demand in these two areas continue
over the next two years with demand expected to slow slightly over the next five years as application
development and testing for CSPs reaches a point of near saturation.
Infosys also provides applications operations to its customers; it includes the following areas within
the realm of AO:
 BCM, DR, and back-up. Infosys believes that, with the movement to cloud, this area will
become more important in the coming years.
 Release management. Infosys currently does this in-house but, as the adoption of DevOps
grows, release management is becoming part of the automated processes.
 Security management. For Infosys, the movement to cloud, open source, and API adoption
has started to make security management more critical. IoT is also increasing the discussion
about and the need for security management.
 Application performance, system availability. Infosys expects these areas to become
more mature with the adoption of industry-wide standards, tools, products, and processes
over the next five years. Cloud providers are more likely to provide them as value-added
services to their current services.
SWOT analysis
Strengths
 Infosys can offer E2E project management expertise and business transformation
methodology.
 It has a strong global delivery model coupled with regional expertise.
 Its flexibility stems from its product-agnostic approach.

Weaknesses
 Infosys has focused more on tier-1 CSPs and has only recently begun to add tier-2/3 CSPs.
Opportunities
 More transformational projects will require sophisticated project management and E2E
delivery expertise.
 CSPs' hunger for partnering relationships favors players with a strong partnering record.
 Business transformation requires a combination of managed services, consulting, and SI
capabilities.
Threats
 Infosys's narrow tier-1 focus could hamper its new business development in fast-moving
markets.
 Large software players are expanding their own managed services business and becoming
less willing to partner.
NetCracker
Company overview
Founded in 1993, NetCracker Technology is headquartered in Waltham, Massachusetts, US, and
employs 5,500 staff worldwide. In 2008, the company merged with Japanese conglomerate NEC
Corporation and NEC consolidated all of its telecoms software and services assets under NetCracker.
The combined assets include network management, customer and service management, and
applications and service platforms. NetCracker acquired Convergys's Information Management
business in 2012, which improved its revenue and customer management and managed services
capabilities.
NetCracker's product suites cover OSS, BSS, big data analytics, cloud platforms, SDN/NFV, managed
services, and professional services. It classifies managed services as a deal with a multiyear term, a
diverse services scope, shared risk-and-reward SLAs, and management of NetCracker and third-party
applications.
NetCracker does not report its overall revenue or managed services revenue separately from NEC.
However, Ovum estimates that BSS managed services constitute around 70% of its managed
services total. NetCracker's managed services revenue grew year on year by over 20% in its fiscal‐ ‐
year 2015, and a significant majority of its managed services revenue comes from the
telecommunications vertical.
NetCracker's services offerings cover four major categories: planning and consulting, end-to-end
turnkey delivery, managed services/end-to-end outsourcing services, and operations and
maintenance. It has three managed services models:
 hosted services
 remote managed services
 build-operate-transfer delivery models.

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