Cloud Storage: The Telco Advantage

I believe that there exist at least three inherent advantages for major converged Telcos in the cloud market, including:

Building on existing user needs
The bandwidth consumption and revenue potential associated with moving data is a way to capitalize on your existing network assets that traditional SaaS suppliers do not have access to, as they buy bandwidth. Add this to driving mobile device sales (smartphones and tablets) and use, as well as the “stickiness” of hosting the user’s data, and a second area of benefit is obtained; neither of these monetization strategies is associated with an actual fee based file service, but are instead realized by simply having an offering with significant take up.

The large existing customer base of established network service providers gives your service offering an opportunity to move up in the “consideration” race. You will likely have a chance to have your offering “tried” at least once, which is huge. Winning the mind share and having the offering get adopted after initial use is the game changer (which is no different from any other of these sorts of services). Along these lines, the initial customer experience is absolutely critical. Ease of use, GUI design, performance, security and differentiation that is immediately obvious, is the game changer.

Lock-in from previous subscription services
There are several advantages that large network service providers have for large scale deployments. One includes the capabilities that they already have in place today; provisioning, identity management and access control and billing. Another is the experience and control systems they have for service deployments. Therefore,  a significant success for this offering can lead to additional revenues, better utilization of existing network and system assets, and create greater customer loyalty.

For these three reasons alone, incumbent Telcos have a built-in competitive advantage.  The key is taking decisive action. In the end, the decision to enter cloud storage is a leadership decision, not a technical one.  Here’s to the leaders.

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