The Analytics Opportunity for Service Providers

Written by Sailesh Krishnamurthy, Principal Engineer

Service providers around the world are seeing an unprecedented explosion of data in their networks. This explosion is characterized by the “Three Vs” (volume, variety and velocity) that are the typical hallmarks of challenging data problems. The service providers that embrace these problems creatively stand to unlock enormous monetization opportunities. The good news is that service providers are uniquely positioned to correlate and analyze data from across the ecosystem (client, network and cloud).

This blog post will describe some of these analytics opportunities. In my next post, I’ll discuss Cisco’s strategic plans to help service providers in this process with Cisco Prime Analytics.

Data Explosion

The data explosion in service provider networks is extremely diverse (“Variety”) and comes from various sources including:

1. Mobile Data. Location, presence, devices and customers.
2. Video Growth. Projected to be 65% of mobile and 90% of fixed traffic by 2015.
3. Machine-2-Machine (M2M): 225 M2M connections by 2014— from vending machines and ATMs to connected vehicles.
4. Commerce. Mobile payment platforms and local offers.
5. Smart Networks. Capable of bandwidth optimization, content placement, SDN, and more.
6. Social Media. Consumer behavior, targeted advertisements.
7. Cloud (XaaS). All data moving to the cloud leading to more app-cloud interactions.

Unlike other players (manufacturers, content/service/app providers), service providers are uniquely positioned to correlate and analyze data from across their ecosystem. In particular they can see data from clients (location/presence, payments, content consumption, data usage patterns, etc.), the network itself (DPI feeds, IPFIX flows from switches, route information, network management data, etc.) and the cloud (application/service usage, content metadata, CDN interactions etc.).

The Analytics Value Proposition

Analytics over these data sources provides the intelligence for service providers to recapture the value of their networks. Analytics is, however, a broadly overused term that means many different things to each constituency. Moreover, each opportunity has a different profile in terms of execution effort as well as upside potential. Over and above all of this, the sheer volume of data involved as well as the relative newness of these opportunities make it important for service providers to “crawl before they walk” – i.e., tackle the easier problems before the harder ones. One way to understand these different analytics opportunities is to categorize them based on their impact to a service provider’s top or bottom line as follows:

1. Reducing operating costs. Today’s service provider networks generate vast amounts of data, much of which is never even preserved, let alone processed.  In a heterogeneous multi-vendor environment, the natural diversity of the data is increased. Understanding this data is “table-stakes” in the network analytics world and can lead to increased operational efficiencies by better network policy improvement, capacity optimization and planning, etc.
2. Improved customer experience. As consumers adopt ever more powerful devices and expect more seamless and delightful user experiences, it becomes critical to ensure that they are never disappointed. This is particularly challenging in a world where service providers have been dis-intermediated and adoption of OTT apps and services have exploded. Ensuring that customers are guaranteed QoS and meeting and beating those expectations is vital in decreasing churn (loss of customers to rivals) as well as potentially cross-selling/up-selling new content and plans. In such an environment, it becomes critical to react promptly when consumers experience problems and not afterward. This requirement of reduced response latency can only be satisfied by analytics infrastructure that can handle streaming data with high velocity.
3. New services. As consumers spend an increasing amount of their connected lives online and especially, mobile, service providers have an opportunity to understand their users behavior and interests and partner with third parties to offer innovative new services. For instance, an service provider could offer an OTT service better quality customer experiences (in streaming mobile video for instance) at a higher cost. Alternatively, an service provider could mine users social media updates (Twitter/Facebook, etc.) to offer targeted advertisements.

Summary

Service providers are right in the middle of an enormous data explosion that, if properly exploited using innovative analytics technologies, offers significant monetization opportunities. While the three Vs (volume, variety and velocity) are well understood in terms of how they characterize the data, a critical aspect to analytics over network data is handling data-in-motion as well as data at rest.  This is a transformational period for the industry, and those service providers who seize the moment have an opportunity to significantly outpace competitors who are not as effective.  In my next blog, I’ll discuss how Cisco Prime Analytics, a new high-performance, real-time, network-centric analytics platform that allows for adaptation to customer environments and use cases, can help service providers realize this opportunity.

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