ChannelVision Playbook V6

has value, not necessarily the “things” (decoders, light bulbs and fixtures). So one way to look at potential TaaS development in telecom is to see increasing management of appli- ances and fixtures necessary to add more value to the core “communica- tions” value. The other way to look at poten- tial TaaS opportunities is to see that most of the created value eventually will come from analytics made pos- sible by the big data gathered by the sensor network and using the com- munications services. Likewise, in the “Internet of humans” space, at least a few mobile service providers will ex- periment with “mobility as a service,” where “supplying handsets” becomes a feature of a communications service for business customers. That is another example suggesting that, if and when TaaS develops, early traction might come where analytics drive the new business value, enabled by a managed offer bundling the sensor network, the communications and the analytics platform. Later on, those sorts of bundled offers might seem quaint. But in the early going, it all might seem familiar enough to ease adoption. Businesses have an understanding of what interconnects, value added resellers and managed service providers do. Businesses un- derstand the value of commu- nications, cloud computing and business intelligence created from mountains of raw opera- tional data. Mix it all together and you wind up with TaaS, where it is not the sensors but the analyt- ics or the management that drives the most value. If you look at today’s con- sumer Internet ecosystem, or the business computing eco- system, to the extent that “val- ue” correlates with “revenue,” then most of the revenue will come from the content (con- sumer ecosystem) or the applications segment of the business IT ecosystem. In 2015, for example, the GSMA estimated the mobile ecosystem at about $3.5 trillion. About 47 percent of that was earned by content or app providers. About 2 percent was earned by content rights holders. Roughly 23 percent was earned by device, other hardware, operating systems and other software. Connectivity services represented about 17 percent of ecosystem rev- enue, according to GSMA, but other estimates assume higher percentages attributable to access providers (per- haps 30 percent in the United Kingdom, as much as 48 percent in Spain). TaaS, then, would be part of the ap- plications market segment, where the IoT function is functionally a substitute for 58 percent of the IoT revenue oppor- tunity, assuming the Internet ecosystem provides an indicator. In other words, TaaS should develop as did other XaaS services: applica- tions, platforms and infrastructure, with a significant access services compo- nent. It will be easiest for most access providers to sell connectivity, as pres- ently is the case. But as proven to be the case for leading telecom providers in the consumer segment of the business, owning at least some of the applica- tions delivered over the “dumb pipe” is the fundamental strategy for dealing with “commodity” products and revenue streams. In similar fashion, at least some tier-one access providers will become owners of TaaS applications, if not so much providers of platforms or computing infrastructure, as distinct from access services. So sales opportunities for telecom channel partners are likely to hinge on the degree to which their underlying suppliers achieve significant “hori- zontal” roles in TaaS. In other words, if app and service providers primarily target general-purpose TaaS (Sales- force.com as an example, or hosted voice, rather than vertical apps target- ed at industry verticals), the channel opportunity will be greater. A heavy focus on software solutions Source: Tel Geography Source: Techaisle Millennials in US Small Businesses (1-99 empl yees) Source: GSMA Mobile Ecosystem Market Size by Segment and Category 30% 20% 10% 0% 2007 2008 2009 2010 2011 2012 2013 2014 2015 2016 Private Sha 41% Employees (weighted data) 35% IT Decision Makers 29% Owners/CEOs/ Presidents ONLINE SERVICES OTHER E-SERVICE OTHER E-SERVICE SEARCH PUBLISHING B 2 C E-RETAIL B 2 C E-RETAIL E-TRAVEL GAMING CAMPING VIDEO OTHER E-SERVICE CONNECTIVITY USER INTERFACE ENABLING TECHNOLOGY AND SERVICES SOCIAL AND COMMUNITY PAYMENT PLATFORMS TOTAL MARKET = $3,463 BILLION OPERATING SYSTEMS APP STORES MUSIC SECURITY AND SOFTWARE CONSOLES TABLETS SMART TVs PCs SMARTPHONES STBs AND DMRs WEARABLES OTHER SMART ITEMS OTHER HARDWARE FIXED MOBILE ADVERTISING SERVICES CORE NETWORK AND INTERCHANGE DESIGN AND DEVELOPMENT WEB HOSTING AD AGENCIES CONTENT DELIVERY AND OPTIMIZATION IP COMMS M 2 M SATELLITE B2B COMMS CR MUSIC SPORTS VIDEO PUBLISHING GAMING 64(2%) 1,637(47%) 373 (11%) 577 (17%) 813 (23%) $ billion, % of total market, 2015 14 THE CHANNEL MANAGER’S PLAYBOOK

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