Shell carpet-bombs lofty enterprise connectivity claims

It may only be a single presentation from a single company, but Shell’s indifference to the latest fads is a reminder that the telco industry has a way of over-hyping itself.

Speaking at the Private Networks in a 5G World conference in London, Johan Krebbers, Shell’s IT CTO & VP TaCIT Architecture, suggested the company has little interest in campus networks unless absolutely forced into the situation, neither in edge computing nor 5G connectivity. The 5G mis-interest should be hedged as ‘for the moment’, though it does undermine the insistence by many telcos that the enterprise segment is thirsty for next-generation technologies.

This is not to say the company is not exploring how connectivity can enhance operations, but it does place somewhat of a dampener on the buzz which is being created around the industry.

“Does it need 5G? Maybe not. But does it need connectivity? Of course, it does,” Krebbers said while discussing the projects which are being driven forward today.

Krebbers work is currently focused on using connectivity to improve the prospects of various aspects of the business. For the moment, the team is primarily focused on the manufacturing and logistics areas of operations, with a keen focus on IOT. Most of the projects are focused more acutely on data, such as predictive maintenance of assets or data-centric reservoir modelling, though many of these projects can be enhanced through solutions available today rather than the glorious next-generation technologies of tomorrow.

Again, it is worth hedging the statements here, there are of course various applications which would require the implementation of much more advanced solutions. Remote inspection of assets using drone technology will require 5G benefits such as enhanced mobile broadband and low-latency, but these are projects for the future. The most interesting elements of this presentation was the disregard for the trends which are being hyped by the telco industry today.

Krebbers said the team would rely on the public internet, not private networks, unless his hand was forced. Countries like Oman and Nigeria have poor 4G coverage therefore it is necessary to invest. Edge computing holds little interest as the team makes almost exclusive use of public cloud infrastructure and services. The team is driving towards a more predictive, not reactive, business structure which also slightly undermines the need for speed which 5G offers.

Shell is still a company which will make use of connectivity solutions, but these are not the enhanced services or products which the telcos will be searching for to generate ROI on extensive investments. In the way by which Krebber is describing Shell, the telcos sit more comfortably in the commoditised, connectivity partner column. The likes of Amazon, Google and Microsoft are more likely to find favour and fortune here.

As mentioned above, this is just a single presentation at a single conference, but it does at least somewhat undermine the extravagant confidence the telcos have in the enterprise connectivity world.

Three bolsters wholesale ambitions with Pareteum partnership

Three UK has announced a new partnership with Platform-as-a-Service provider Pareteum as it searches for new revenues in the wholesale segment.

The multi-year partnership with Pareteum will see the telco push further into the wholesale world, with the ambition to attract new mobile and IOT services onto the new network. For a company which is almost exclusively known for consumer operations, the growing appetite for connectivity in every aspect and element of today’s society is an attractive prospect to grow revenues.

“We are really excited about the opportunity that this partnership delivers,” said Darren King Head of Wholesale Business Development. “We have significant growth ambition in the IoT and Enterprise Communications markets and Pareteum brings global scale and proven capabilities.”

To provide some context, whole connections currently account for roughly 12% of the traffic which is currently traversing over the Three network. Considering the telco believes capacity on its network could increase by 28X over the coming years, there is an opportunity for Three to bag additional profits.

Across the Three business, there has been a push into new areas. Perhaps the source of these ambitions can be linked back to the connectivity landscape; the smartphone market has exceeded 100% of the UK population and consumers want to see their monthly bills come down, while expecting more from the tariffs. It is becoming increasingly difficult to make money if you are a business which is purely focused on the mobile segment.

While this does not create the most comfortable of pictures for MNOs, the Three management team have set high expectations over the next few years; the business is expected to double in size. This means double the connections on the network, double the number of subscribers, double the annual and double EBITDA.

To meet these expectations enterprise is an area of growth, the UK Broadband team is working hard in the campus network space, fixed-wireless access takes it into the broadband arena, there are already 800,000 subscribers, and King’s efforts here will bolster efforts in the wholesale segment. If Three is to meet the monstrous objectives, all of these ventures will have to be on-point.

And while it is still early days, there is progress being made. There is currently a dedicated team of 40, working alongside other employees in the wider Three business, while numerous partnerships are already in place. In search of growth in the enterprise IOT world, Three Wholesale currently has partnerships in place with the likes of Gamma, ARM, Wireless Logic and AT&T.

However, it is in the consumer MVNO segment which the Pareteum partnership enables. The current relationship with SuperDrug is an excellent example. This is an organization which has ambitions to offer connectivity orientated products to its customers, but it doesn’t have the know-how. Pareteum can provide the platform, Three the network and both can aid with the business.

For Three, the challenge here will be to enter into a market which is already incredibly competitive. It is coming late to the party, though there are certainly some interesting elements to the Three business. The team constantly talks about the advantages of its contiguous spectrum assets and a nationwide footprint of 20 datacentres enable the team to create edge solutions closer to the customer. With low latency soon to become a demand of customers, this could certainly add some muscle to the Three network.

With 5G on the horizon, and the IOT segment continuing to gather steam, connectivity is forcing its way into almost every business model and product design. Three has certainly outlined some bold ambitions, and the only way it can live up to these promises is through the business diversification which is gathering momentum.