Next Generation Telecom Support Systems in China

CCID Consulting hosted China's 2008 New Telecom Management Operations Summit in Beijing. In attendance were Chinese government officials, industry experts, academicians, telecom operators, and major IT vendors, including Asiainfo, Amdocs, Bright Oceans Corporation, IBM, USTC E-business Technology, and ZTEsoft.

The conference's theme is on the next generation of China's telecom operational support systems, within the context of convergence, full operational services, and the 3G era. CCID Consulting also released it research on China's Telecom Operational Support Systems, which reviews and forecasts China's telecom operational management systems.

By the end of 2007, China's telecom overall operational support systems spend reached 6.37 billion Yuan.

Of the total systems spend, 53.6% was on business support systems (BSS), 29.8% on operational support systems (OSS), and 16.6% management support systems (MSS).

Operational Support System	Spend, in millions Yuan	Spend Share
BSS	3,414	53.6%
OSS	1,898	29.8%
MSS	1,058	16.6%
Total	6,370	100%

China's telecom operators have strengthened their investments on operational support systems since 2002, as their networks have become increasingly complex with rapid user growth. As telecom operator systems have improved gradually, operators are also beginning to take a more planned and systematic approach.

China's telecom operators have gradually improved their systems to support existing business, taking into account business processes, network management, and vendor management. Below is a summary of key telecom operators' operational support systems status.

Telecom Operator	Systems Status
China Telecom	Realized centralized processing and support existing businesses.
China Mobile	Considers B/OSS as core, with support to centralized mobile voice and data services.
China Unicom	Realized centralized processing and support of existing, integrated services, include integrated C networks, G networks, VoIP, tolling, data link, and Internet.
China Netcom	Completed centralized processing and the support of existing, integrated services.
China Railcom	Building centralized systems which considers T/BSS as core and realizes support to existing services.

With the expected 2008 completion of China's telecom restructuring, operators have entered the full services era. This will have an impact on how they compete in light of increased competition. In particular, operators will need to fully integrate their fixed-line and mobile networks and operations.

In the past, mobile and fixed-line operators have different demands for their support systems. Mobile operators emphasized real-time accounting, usage monitoring, and partner management, while fixed-line operators emphasized automated processes and integrated business marketing functions.

Looking forward, the challenge will be integrating these demands into one, both at the service provisioning and support systems levels.

Major multinational vendors, such as Asiainfo and Amdocs, are able to provide more integrated services support systems, such as products that support both fixed-line and mobile services. Chinese domestic vendors tend to focus on a specific part of the system, with less experience in full services support. Regardless, all vendors will need to focus their products and services towards the full, integrated services model.

Looking at a snapshot of vendor competition, for BSS, the revenue share of AsiaInfo and Amdocs combined is over 50%, while shares for ZTEsoft and Linkage grew rapidly. For OSS, the major vendors are Bright Ocean Corporation, MetarNet and Datang Software.

BSS Competition		OSS Competition
Vendor	Share	Vendor	Share
AsiaInfo	35.1%	Bright Ocean	38.1%
Amdocs	28.7%	MetarNet	33.2%
ZTEsoft	12.3%	Datang	10.1%
Lianchuang	11.1%	Guoxin Lucent	5.6%
HP	10.0%	Ultrapower	4.3%
Others	2.8%	Langchao LG	3.5%
N/A	N/A	Others	5.2%
Total	100.0%	Total	100.0%

Recent mergers and acquisitions suggest the move towards meeting integrated support services demand. In early 2007, Amddocs acquired SigValue, an accounting, CRM, and service control platform vendor for 54 million USD. In June 2007, Ericsson acquired LHS, a Germany accounting vendor for 310 million Euros, which enabled Ericsson to have more comprehensive accounting and billing solutions. In early 2008, Oracle acquired BEA, which enabled Oracle to compete strongly especially in B/OSS, having database, middleware and application software.

Different telecom operators will encounter different challenges in their road towards full services, as they begin with different user demands, support systems, networks, and architecture. Original fixed-line operators, for example, will need to improve on their channel/partner management, signal control, real-time service capabilities, while mobile operators will need to focus more on process/flow management and integrated business support.

Regardless, a planned, systematic approach will be needed with a focus on modeling functionality and business integration. CCID Consulting believes that risk mitigation strategies should be incorporated into the planning and execution of new systems. As an overall roadmap, the first step should be to provide a uniform experience to the user, and then the integration should proceed to the back office to fully realize the benefits of integrated business and operational support.

Please contact us for these and other China-related data, information and products.

Unless otherwise specified, all information provided is sourced from CCID Consulting.