Verizon looks to virtualization and IoT to boost wholesale revenues

The combination of virtualized platforms and open APIs can revolutionize an operator’s enterprise and wholesale business. Virtualization and SDN allow capacity to be allocated, and charged-for, on a pay-as-you-go basis, and in future, to create ringfenced ‘slices’ of the network to be created for a company or service provider. Meanwhile, open APIs allow the customers to tap into the operator’s application programming interfaces to build new services and software which harness the capabilities of the network and drive new offerings.

These twin trends are being employed by AT&T, Orange and other high profile operator projects to expand their enterprise and MVNO revenue streams, and now Verizon Partner Solutions (VPS) is also talking up its plans in these areas.

At the annual conference of INCOMPAS, the US competitive networks’ trade association, VPS’s group VP, Dennis Elwell, said he wanted to expand the wireless services and Internet of Things options open to wholesale customers. The unit will be developing new pricing plans and contracts which are more appropriate to the IoT, as enabled by more flexible networks and IT platforms. This could make VPS into a key enabler for non-wireless service providers which want to enter the IoT and enterprise applications markets.

Most mobile operators have accepted that MVNOs are an essential part of their business – the risks of cannibalizing their own revenue bases are offset by the lower cost of supporting indirect users and the broader reach a good choice of MVNOs can enable. These trade-offs are even more obvious in enterprise markets, where many vertical sectors are best addressed by integrators with specialist knowledge, and in the IoT, in which the telcos cannot hope to own such a vast and fragmented market by themselves.

Although Verizon has been selling its wireless services on a wholesale basis for five years, Elwell said, there was significant growth potential among conventional MVNOs, but also among business or wireline providers which want to add a wireless element for the first time. The IoT will expand the opportunities further, and VPS is working on solutions for wholesale customers under Verizon’s broad ThingSpace umbrella development.

“We have a pretty significant base of wireless wholesale customers, mostly on 3G,” Elwell said, as reported by LightReading. “About nine months ago, we started offering 4G and we saw things really take off. We think we can offer integrated solutions for IoT, to make it easier for people to buy and we are excited about working with many of our traditional partners – ILECs, CLECs and rural telecom companies – that have not dabbled in mobility yet.”

Next steps include making use of Verizon’s developments in SDN (software-defined networking) to support on-demand service provision. That would enable the wholesalers to dial capacity up and down according to the needs of their own customers and pay Verizon per usage.

“We know the infrastructure needs to be more flexible, and with the prospect of SDN and NFV, through virtualization, we will be able to do that. Then we’ll usher in the OSS that will allow us to rationally provide the services, bill for them and provide the return.”

And VPS is keen to open up access to its wholesale network via APIs rather than electronic bonding.