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blockchain empowering the internet of trust


SUCCESS Playing a central role in managing complex partnerships

blockchain

empowering the internet of trust Eduardo Guardincerri, CMO Enrique Wong, Head of Voice Wholesale Product Marketing Telefonica International Wholesale Services

I recently had the chance to spend some time with Eduardo Guardincerri, Chief Marketing Officer of Telefónica International Wholesale Services and Enrique Wong, Head of Voice Wholesale Product Marketing in Telefónica’s B2B Products & Services area to discuss the challenges and opportunities present in our industry. During the course of this interview, they also shared their view on how blockchain may be the long-awaited game changer that will enable wholesalers to not only generate efficiency, but also to create ground-breaking services and, even better, new revenue – empowering the internet of trust.

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But the question that remains in all the carriers’ minds, is ‘Who will pay to transport this traffic?’. About 70% of this comes from Over The Top service providers and 60%-70% of that is generated by 4 or 5 companies. This is massive. Then the next challenge is that we do not only need to transport this traffic, but we must also store its details, warranty its privacy and security, while at the same time making the operation transparent for customers. Another obstacle carriers will have to overcome is that everything will be connected which will not only increase the traffic by 20 to 30 times at least, but more importantly, it will create a level of complexity never seen before in our industry.

WITH CHAOS COMES GREAT OPPORTUNITIES

What main challenges need to be addressed by wholesalers in our rapidly evolving world? Eduardo G: I see challenges coming from 5 different angles. The first one is the need for efficiency. SDN and NFV are already enabling us to address this and significantly reduce the direct cost of service, but more needs to be done. The second issue we face is the business model around data traffic expansion. We must find ways to manage the huge data volume that we receive and this is only going to become more arduous. At Telefónica, we created a separate company called Telxius, to help us address this.

All elements are becoming more complex, from our agreements, services, technology to ensuring omnipresent security. Finally, maybe the biggest challenge of them all, is for us to realize that we cannot and should not be pure wholesalers anymore. On the contrary, we must drive our companies to transform into service providers, to provide solutions targeted at the end-users and not at the channels or operators we have perhaps traditionally served.

In my opinion, with chaos comes great opportunities. So what opportunities do you think carriers should address going forward? Eduardo G: As the world is becoming ever more complex, no one company will be able to do everything on its own. So, to address the opportunities of the new digital world, many players will need to come together.

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Wholesalers, by definition, are experts at managing multi-party agreements, relationships, networks and billing. We have been doing this for more than 20 years. Based on this expertise, we have the ability to build and manage complex partnerships to create multifaceted solutions that would not be possible otherwise. Consequently, as carriers, we have the opportunity to put in place complex solutions that bring together a number of different parties by playing a central role in connecting them. This not only in terms of network, but also in terms of services, contracts and settlement. By doing this, we can bring significant value to the table. BLOCKCHAIN – A GAME CHANGER?

Do you think blockchain will be a game changer in our industry and if so how? Eduardo G: We definitely think that blockchain will be a game changer if harnessed correctly. Blockchain by nature enables security and transparency. In addition, it is an immutable database, so it ensures that the truth is guarded. Therefore, we think it will create what we like to call ‘The internet of truth’, ensuring trust is built between multiple wholesale parties. From there, real-time, automated fraud-free interactions can be introduced between wholesalers, bringing ultimate efficiency to our business. So initially, it will bring more efficiency to our business. There still are many services which currently use manual or semi-automated processes and blockchain could be the trigger to enable the full automation of those.

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The first few that come to mind include voice termination, roaming and fraud prevention. It could also be used to enhance functions we have failed to successfully address up to now, such as number portability for example. At this stage, we are looking at all the possible use cases for which blockchain could enhance efficiency and we are confident that it will change the way we conduct our business in the near future. Then, further down the line, it should enable us to launch new services. We see requirements from our enterprise customers for us to enable blockchain as a service and we feel we are perfectly positioned to offer such a solution. Some say that blockchain could mean the death of wholesalers. In my opinion it is the other way around, as it is difficult to imagine telecom operators deploying cloud capabilities or the connectivity necessary to support such solutions on a global scale. Therefore, if we play our cards right it will be a big opportunity for us.


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to improve our efficiency, to digitize our structure and processes and to simplify our business. This for our retail, enterprise, as well as our services provider customers. To achieve this on the enterprise side, we are looking at a number of use cases around the efficiency of the supply chain, to help track inventory or manage suppliers more efficiently for example. Additionally, when it makes sense, our objective is to create new services by integrating blockchain in many of the innovation initiatives that we are running within Telefónica, such as Artificial Intelligence, Big Data and IoT. We are also analyzing the potential use of blockchain in each of our digital services to see if it could empower us to make them more efficient. THE TELEFONICA BLOCKCHAIN JOURNEY

What is Telefonica’s plan when it comes to blockchain?

We are in the learning stage at the moment, and are working closely with customers and partners to determine how this will unfold. But we are confident that we have the infrastructure and the knowledge to play a key role in the blockchain ecosystem of the future.

Enrique W: At Telefónica, we are looking to use blockchain in three main areas: efficiency, new services and blockchain as a service. We operate in 17 countries and serve over 350 million customers. So, our main objective when it comes to blockchain, is to use it to provide truth. We believe more in the internet of truth instead of internet of value, and therefore provide confidence and better quality to our customers. This could be achieved by using blockchain

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ABOUT THE AUTHOR Isabelle Paradis President HOT TELECOM

Isabelle is President and Founder of HOT TELECOM, one of the most innovative and creative telecom research and consulting companies in the industry. More recently, Isabelle has been working with many of the world’s telecom service providers to help them define their transformation strategy. She has published several articles and reports on the subject and has spoken at numerous conferences around the world to share her views on the future of the international telecoms business.

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Profile for HOT TELECOM

Blockchain - Empowering the internet of trust  

I recently had the chance to spend some time with Eduardo Guardincerri, Chief Marketing Officer of Telefónica International Wholesale Servic...

Blockchain - Empowering the internet of trust  

I recently had the chance to spend some time with Eduardo Guardincerri, Chief Marketing Officer of Telefónica International Wholesale Servic...