The business of services

The new service providers are network equipment vendors, all the biggest ones, and they are bringing their solution-oriented, "I-want-to-be-your-best-friend" pitch right to the doorstep of those companies we have always called service providers. This is not as confusing as it sounds, and if you have been watching telecom closely in recent years, it is not much of a surprise either.

Vendors have been developing "services businesses" for many years, even before any of them referred to what they were developing as "services businesses." First, it was "professional services," and later, it was "managed services," and now, it's evolving toward the notion of a vendor helping a carrier customer that is a carrier in name only and really not much more than a "service marketer" or "customer relationship manager."

And, that's fine by most carriers and their customers. It probably means more aggressive service innovation and better customer care from the local telephone company or mobile carrier. Though I have always wondered when the vendors would just take over the whole thing, meaning you would get phone service from Ericsson or NSN directly and by name. Or, is that already happening?

The services trends has been less obvious in the U.S. than in other markets around the world, but it will happen in the U.S. eventually, too, if carriers here see that it can both save them money and allow them to focus on making more money with the resulting free capacity.

The services business used to be just an interesting sideline to the vendors, but this week's hiring of Rajeev Suri to take over as CEO of NSN means that NSN, Ericsson and Alcatel-Lucent all will enter 2010 helmed by execs experienced in services provisioning. The services business, all of a sudden, seems like business as usual.

- Dan

Related articles
NSN's Suri was named to replace Simon Beresford-Wylie
Services guru Hans Vestberg will be Ericsson's next CEO

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