The Disaggregation Opportunity: Putting the customer at the heart of a reimagined telco ecosystem

Richard Jeffares, CEO at Vitrifi

calender icon3 min read

calender icon22 February 2024

In my previous blog, I outlined Vitrifi's strategic vision and future blueprint to enable disaggregation of the Telco sector. This is a vision where openness and competition drive innovation, ultimately benefiting the end-customer experience and driving operator profitability.

In this blog, I want to reflect more deeply on the benefits of disaggregation as asset owners remove the legacy systems impasse, whilst removing barriers to entry and the mould of stifled innovation – before exploring how these next steps can translate into positive experiences for the consumer, whilst resulting in greater digital enablement for society as a whole.

The Current Telco Landscape: Complexity Holding Us Back

One word, and one word only, is needed to describe the current state of the telecommunications industry: complex.

Historical systems are monolithic by design, characterised by closed architectures that impede new product creation often leaving consumers with limited choice and locked into “un-used” bundled services that do not meet their needs. It is a far cry from the increasingly personalised, on-demand, digitised world we experience outside of a Telecoms “here is your bill” customer relationship.

This lack of online self-service activation and automated tools for fixed broadband, normally means repeated truck-rolls (i.e. technician visit) that translate into higher prices and missed installations.

Breaking the Mould of Anti-Competition and Stifled-Innovation

Many often overlook the fact that competition is critical for any market to thrive and grow, and the telecommunications industry is no exception. In the past, a single player (i.e. Post Office/Telecom incumbent) often controlled the entire network asset, from infrastructure including poles or real estate (e.g. exchanges or towers) through to service delivery being the customers’ copper telephone connection. This history of industry evolution created a closed system with little or no relationship with the end-user. Furthermore, this operating model has historically required intensive Capex to operate these systems, and in the process, has impeded R&D investment that in turn limited product and service options for consumers.

Thankfully with the arrival of machine-learning-powered digital tools, change is now unavoidable for the Telco sector, exacerbated further by the influx of new market entrants, fuelled by data science and cutting-edge software that can hyperscale to the demand of the future ecosystem of new applications and services.

The Vitrifi Network Operating System when coupled with our multi-tenancy and white-label-ready wholesale tooling, will offer an immediate reduction in complexity. At the investor table, it is also evident that Telco asset owners are now actively embracing structural separation of divisions that maintain the network (NetCo) from the end-customer facing entity (ServCo). This dismantling of siloed structures has happened before in the Mobile and Tower sectors, but the financial separation of duplicate hardware and software used in fixed broadband for operations has not happened in most investment cases.

This material shift in network economics will enable more direct investment across new automated tooling for product enablement, helping to create a more dynamic Telco ecosystem, where players compete to deliver rapid installations and more attractive service offerings for customers. This new flexibility will allow incumbent or greenfield operators to integrate newly acquired fibre networks quickly, accelerating time to cash (i.e. ‘book-to-bill’) and lowering the cost-to-serve for the entire customer lifecycle journey.

To explore how this translates into improved network performance and greater digital enablement for society as a whole - read the next blog - “The Customer Wins: Competition, The Enabler of Improved Customer Experiences”.