A clear path for Blockchain in Telecom

Blockchain in telecom is a powerful concept and the clamor is somewhat justified, if only because it is able to generate a fantasy to make unnecessary the large areas of lawyers, bankers and sellers of OSS. What could be better? A blockchain system could do this by establishing the trust given by third-party services.

There are, of course, many obstacles to blockchain technology. These include the perception of lack of maturity and the difficulty of selling crypto-hobbyist technology in large companies. Service providers, who move more slowly than large companies, are not usually the first outlet market that comes to mind.

But Clear Blockchain Technologies, a company based in Israel, thinks it has a working approach. This leads to the creation of private blockchains that can help accelerate the automation of one of the most difficult areas of the field, the settlement between carriers. Clear is also targeting the use of blockchain-based automation in billing and OSS software.

"Telco is at a turning point," says Gal Hochberg, co-founder and CEO of Clear Blockchain Technologies. "There is an exponential need for data and telecommunications companies need to provide new capabilities, but their ability to deliver value is limited, we can enable new services using blockchain."

Hochberg pointed out that telecommunications companies, in order to compete with the cloud, must accelerate their process of agreement between carriers, which is still largely manual. The Ethereum-based private blockchain technology of Clear aims to "smart contracts" that can be built into code that runs automatically when the services are met.

Hochberg believes that the service provider market may not be ready for the public blockchain, so he built a distributed book on a private one. He believes that someday large corporate entities will feel more comfortable with public blockchains, which he prefers to use on the Internet, but for now there is more security and control in the use of a private blockchain.

These new services will include services such as bandwidth on demand for things like virtual reality and augmented reality, says Hochberg. Or it could be as simple as using the blockchain to automate inter-carrier Ethernet connections targeted at the company.

Of all potential areas, contracts between carriers appear to be the most mature areas for benefit. Global service providers have a reputation for being painfully slow in adopting innovation. But if there are areas ready to change, these are communication contracts like those for MPLS or Ethernet on a private line, which can take months to complete.

Distributed accounting and bitcoin technology have already found use cases in the real world. These include tracking shipping resources, as implemented in a broader partnership between IBM and Maersk. It has many other applications in vertical markets because it promises to automate reliable transactions and verify data. Think about checking and following the drugs in the pharmaceutical industry.

Telecom has many features that make it a likely house for blockchain. There are a large number of agreements with third parties. Communication sessions are transactions that often require a complex liquidation process. If you think of blockchain and master books distributed as a secure and automated registration of transaction data, this could be the right place, as the Talking Heads once sang.

James Crawshaw of Heavy Reading recently highlighted the opportunities for telecom blockchains:

Fraud prevention: If blockchain-based security should lead to a halving of fraud, this would save money 39; telecommunications industry $ 19 billion in the year, or 1.8 percent of total revenue.
Network security: we consider this opportunity a risk mitigation opportunity, not a cost saving opportunity or new revenue for CSP.

Identity: Here we see a potential new revenue stream for CSPs as trusted entities providing identity management as a service (IDaaS).

Settlement: If mobile roaming were to migrate to an alternative to blockchain at lower cost than existing systems, it could save the global mobile industry $ 650 million dollars at the same time. year, or 0.04% of total revenue.

Mobile payments: Blockchain could play a role in mobile payments as an alternative to established intermediaries.

Clear is working with the MEF, which also has its eye on blockchain. There will be an upcoming Proof of Concept (POC) blockchain at the November MEF conference in Los Angeles. MEF is trying to accelerate automation between carriers with APIs (Application Programming Interface) known as LSO Cantata and Sonata.

MEF Pascal Menezes' CTO says that the potential is real, with tests already under way. "Blockchain is real, processes are happening and commercial settlements have been used, it has been used," Menezes told me in an interview. "It's not a cake in the sky."

Menezes says blockchain technology has the right attributes to help automate billing during settlement. It also has the potential to help with security and identity.

"It's a distributed general ledger, so it's the perfect technology [for carrier settlement]," says Menezes. "It's designed to adapt to currencies."

The potential has certainly attracted the attention of some telephone operators, some of whom are already making important moves.

Colt and PCCW, for example, are working on experimentation to help automate international agreements with carriers. (See Colt Ramps Its Blockchain Efforts, Explores SDN Federation Use Case.)

The Japanese giant NTT, meanwhile, has filed a patent to use blockchain technology for smart contracts, described as "methods, systems and devices to leave evidence of a contract on a blockchain by a simple method despite having agreements between the parties involved, maintaining the modality of an electronic signature by transaction and maintaining credibility. "

While the industry has targeted many potential cases # 39; use for blockchain in telecom, I believe that Clear and the MEF are correct to direct the billing and settlement processes of the operators. Inter-carrier agreements and billing are the most painful technology areas in the telecommunications sector, and those areas seem to slow carriers from entering new markets as quickly as younger and new cloud providers. Any progress in updating an old-fashioned BSS / OSS settlement and orchestration process would be a wave of industry news.

– Scott Raynovich, founder and principal analyst, Futuriom

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