What's Up with Tech?
Tech Transformation with Evan Kirstel: A podcast exploring the latest trends and innovations in the tech industry, and how businesses can leverage them for growth, diving into the world of B2B, discussing strategies, trends, and sharing insights from industry leaders!
With over three decades in telecom and IT, I've mastered the art of transforming social media into a dynamic platform for audience engagement, community building, and establishing thought leadership. My approach isn't about personal brand promotion but about delivering educational and informative content to cultivate a sustainable, long-term business presence. I am the leading content creator in areas like Enterprise AI, UCaaS, CPaaS, CCaaS, Cloud, Telecom, 5G and more!
What's Up with Tech?
Transforming Cloud Communications: Ericsson & Vonage on CPaaS Innovation, Network APIs, and AI-Driven Apps
Interested in being a guest? Email us at admin@evankirstel.com
Unlock the secrets to next-level communication technology with an industry veteran from Ericsson. With 25 years of experience under his belt, Joachim takes us on a journey through the groundbreaking collaboration between Ericsson and Vonage. Discover how Vonage transformed from a humble consumer VoIP service to a powerhouse in cloud communications, now offering a CPaaS platform that seamlessly integrates video, voice, and SMS into applications. Learn how the marriage of Ericsson’s telecom prowess and Vonage’s dynamic developer community is driving innovation, redefining customer experiences, and creating lucrative new revenue streams for telcos.
Explore the exciting advancements in network APIs as Vonage and Ericsson work to connect global carriers, recently launching APIs in Germany and Spain amidst growing developer interest. Hear about their game-changing partnership with AWS to fortify fraud protection solutions using cutting-edge AI technology. We also delve into the future potential of network APIs, including identity and security applications, and their transformative possibilities for sectors like mobile gaming, remote surgery, and professional video broadcasting. This episode sets the stage for dynamic developments and future innovations in the communications industry.
More at https://linktr.ee/EvanKirstel
Hey everybody. We are diving deep into the world of communications and network APIs today with Ericsson and their Vonage business. Joachim, how are you?
Speaker 2:I'm great. Thank you how are.
Speaker 1:You appreciate it. Of course, many of us know Ericsson and its long-storied history, and some of us even know a lot about Vonage, going back a couple of decades from a consumer VoIP services company to a global business communications leader. But tell us about yourself, your role and your team within Ericsson, and also give us a bit of an update introduction to Vonage.
Speaker 2:Yeah, well, let me start with myself. So I'm Joachim Sorelles, as you can see on the screen here, working in Ericsson since 25 years. I've been working mainly with our core business, which is to provide network equipment to our CSP customers. However, since two years back with the acquisition of Vonage that we're going to cover a little bit later I've been working with setting up and starting up our network API business, something that we sometimes refer to as the global network platform the networks as a global platform for innovation for the industry. Hence the title that I'm head of the Business Units Global Network Platform in Ericsson. Right, so you mentioned Vonage.
Speaker 2:Vonage has been around for a while and it is a cloud communications company, as you know, and you mentioned the word leader as well. And yes, if you should believe Gartner's magic quadrant, it's definitely a leader in CPaaS, and the foundation of the Vonage business is really the CPaaS platform, and this is a communication platform, fully programmable, allows for developers and enterprises to integrate video communications voice into their applications in an easy and seamless way, and, built on this platform, vonage also provides a number of applications that makes it easier for enterprises to engage with their customers. There are call center applications, unified communication suites, ai platforms, verification suites and so on. So all these tools, if you would like, all these offerings from Vonage, build on mobile network APIs Simple ones from the beginning SMS, voice and video.
Speaker 2:But Ericsson, of course, realized that the mobile networks, the 5G networks, have so many more capabilities to offer than just this basic foundational ones. And given our knowledge about telco products in Ericsson and our relationship with the CSPs and our knowledge about what the mobile networks could really enable, coupling that with the Vonage knowledge about the developers and its reach into the developer ecosystem 1.6 million developers, 100,000 enterprises plus as their customers we realized that this was really, really a good fit to start to make these more advanced network capabilities available to developers globally. So that's why Ericsson and Vonage together is sort of spearheading the development of global network APIs that we're going to talk a lot more about here, and it is really this Vonage CPaaS platform that is at the foundations to extend that into more advanced capabilities going forward. So that's a little bit about Vonage and Ericsson and our plan going forward.
Speaker 1:And it's an exciting plan. Of course we live in a sort of API economy already, but the telecommunications industry is at an interesting stage where transformation, new services and new revenues are much needed. So you know, how can communications and network APIs kind of together not just help telcos transform and, you know, reinvigorate businesses, but also help their business customers?
Speaker 2:their B2B customers stay ahead of the competition. All right. So I mean, network API is like SMS, voice and video that I mentioned has been used for the past decade to improve the communication between these enterprises and their customers. I mean, we're all familiar with a notification SMS we'll get to remind us about an appointment with a dentist or with a doctor or car service repair or something like that that we have booked.
Speaker 2:Now, as I mentioned, the network APIs could be so much more. I mean, the network has so many more capabilities in terms of authentication, in terms of being able to provide a service level agreement between the application and the network what we call quality of service. It has location capability, like I mentioned. Also, it can provide information about many types of information about the device itself, more than location, but also information about the network what's going on in the network, how many users are in a certain location, and so on. So we believe that if we could unleash that potential to the developers, not only would they be able to enhance their current applications with more and better services, but they would also be able to innovate new things that haven't been available before, and I think that all businesses, basically in all verticals are going through this kind of transformation today. This digitalization, where connectivity is a key pillar and network APIs, of course, will play a key, foundational function in that journey of digitalization for them.
Speaker 2:And the ones that enable sort of embraces, this early on, because we are in the beginning of a longer journey. We have to admit that it's not all done yet, but businesses that are early on and adopt this early will have an advantage compared to their competition definitely.
Speaker 1:Yeah, for sure, and one of the very hot topics we've seen for the last number of years is enhancing customer experiences, and personalized real-time interactions powered by APIs has been such a hot topic. You know what are the key drivers for this. Is it CX? Is it operational efficiencies? Is it innovation acceleration? Is it innovation acceleration? What are some?
Speaker 2:of the key talking points that you're seeing with your telco customers, Right?
Speaker 2:So I think we should differentiate a little bit about the drivers from the enterprises and developer communities, if you would like as such, and the telco operators.
Speaker 2:So for the enterprises and the developers, of course, the key driver is to enhance their current application and to innovate and add new applications that they couldn't do before, before they had this available. I'll maybe give a few examples a little bit later on, but if you think about the telcos, on the other hand I mean for them it's clearly a key that the investments that they have made into the 5G networks, that they can monetize them beyond the connectivity or the regular best effort for mobile broadband that they're providing today, and it is a big opportunity. The latest that we have done, where we've done a bottom-up analysis with a partner regarding, as a developer, asking hundreds of developers if you had access to these network APIs, which ones would you be interested to use, for what purpose and how much do you think you would be able to pay for using this Even with such a bottom-up of a conservative analysis, we came to a staggering 15 billion US dollar opportunity in 2013, on top of the current CPAS revenues that we have today.
Speaker 2:So, of course, for telcos, this is a very much wished-for and sought-after opportunity to actually add additional monetization onto their network. And the interest around Camara and Open Gateway and the standardization initiatives it really shows that the CSPs have understood that there is a big opportunity here and it is important to engage with ecosystem early on and to prepare their networks to take advantage of this revenue stream. And Vonage and Ericsson obviously, given Ericsson's background in the telco business and Vonage experience with the developer community were really well-placed to support the CSPs in this journey. So that's really great, I think.
Speaker 1:So I think I mean it's clear that for the CSPs, I think I mean it's clear that for the CSPs, this is a big opportunity to actually add a new leg to their business operations that will provide significant revenue in the years and decades to come. Wow, it's an exciting journey for sure. And you're right, we're just at the beginning, despite, ironically, having these APIs for some time. But you know, talk about some additional benefits to the telco operators as well, in terms of things like customer retention or maybe market differentiation. It's a very competitive market, I know. I personally, as a small business owner, I have three eSIMs right, so I have all the telcos in my devices already. So how do you then differentiate? What are the kind of services that you think will be enabled by Ericsson and Vonage moving forward?
Speaker 2:Yeah, so as a telco, and then for the network API business to sort of pick up. The first step, I think, is harmonization and standardization, because as a developer, you would like to make sure that when you provide a service it's available to all subscribers in the particular region or geography where you're operating.
Speaker 2:It will not be good if your service works on the AT&T network in the US but not on the Verizon one, for example. So a certain level of harmonization and standardization is needed for it to work. Then, when you look beyond into more advanced services like quality of service and quality on demand, there the network quality and the network performance can really be a differentiator for the CSPs, because different CSPs might be able to provide different service level agreements, better quality of service, basically if you are on one than the other, and this would mean that as a subscriber, if you have a very important application, you can make sure to choose the CSP, the operator that has the best offering for your type of application. But I think that's a little bit further out in time because it requires really the foundational layer of harmonization and standardization to be in place before it can take the step of doing the actual differentiation in terms of CSPs.
Speaker 1:Yeah, it's exciting. So you're a partner to virtually every telco network operator in the world. Almost you know, probably most of them at least. And how do you see the partner ecosystems shaping up? It takes kind of this ecosystem to enable third-party developers to build on top of the Vonage and Ericsson infrastructure. How are those developer communities coming along and what else could be done to foster that sort of innovation with third-party developers?
Speaker 2:So this is really a question of supply and demand, if you would like.
Speaker 2:There has to be a certain supply from the CSPs.
Speaker 2:We talked about harmonized offering across a geographical area, for example, for the developers to invest in actually using network APIs in that region. At the same time, for the CSPs to invest in network exposure, there has to be a demand. So sometimes we can think of it as a bit of a chicken and egg problem. Fortunately there are leading CSPs out there, like I mentioned, that have realized the potential of network APIs and have started to invest to provide the supply of the first network APIs across many geographies, if not globally, so that the demand can start to build up. But it is for sure a bit of an evangelism task if you would like to explain to the CSPs that if you build it they will come. And on the other side of the coin I mean explain to the developer community that doesn't know really about the network capabilities and what they can do. Explain to them that if you had access to this, imagine what you can do and then make them put the requirement and demand back on the CSPs to actually provide that supply.
Speaker 2:So, we're a bit of a right now, I think, in a tipping point in that supply and demand conundrum. If you would like. I think Camara standardization and GSMA and Open Gateway has been tremendously helpful in making sure that the industry starts to move, in providing the supply that will generate the demand, that will create additional supply, and starting this positive flywheel, this positive momentum of investment into this industry.
Speaker 1:It's a fantastic opportunity. The outlook is certainly bright, and do you care to call out any kind of projects or collaborations? You've been working with many carriers on the network API side. How is it shaping up and are enterprises starting to get the benefits of some of this enablement? Yeah, for sure Like.
Speaker 2:I said I mean Vonage, ericsson, actually you mentioned it. We're working with all operators globally on our network infrastructure business and we have had multiple announcements of collaboration together with Vonage as well digital x last year, orange, telefonica, vodafone, sync, to latin t, verizon, kddi, just to mention a few. So there is for sure I mean our. Our goal is to connect all csps globally to, to create this global network platform to provide the supply of network apis to bondage and to others as well over time. When it comes to to developers, I mean we did launch in Germany and Spain the first two APIs number verification and SIM swap and we start to see an interest in the developer community to start working with those APIs and start using it. Commercial traffic is just about to start to pick up on those APIs as we speak. So it's clearly, I think, a good opportunity and a good situation to be. We are at this tipping point of where this market is going to pick up.
Speaker 2:We also recently launched a collaboration with AWS, amazon Web Services recently launched a collaboration with AWS, amazon Web Services to accelerate the availability of the solutions that Vonage have to the millions of developers that AWS have on their marketplace.
Speaker 2:So, in particular, this is a fraud protection solution that has been made available that sort of combines the Vonage offering on Camara-based APIs, the ones I mentioned number verification and SIM swap. It includes the Vonage fraud defender solution and also use AWS generative AI and their recognition platform to build to increase the confidence of the end user authentication as we go along. You can think about the banks, for example, being the customers of this solution, where the system would be able to explain to the bank what is the confidence level of this user actually being the person that they say they are when they're making a bank transaction online, for example, being the person that they say they are when they're making a bank transaction online, for example. So a very, very powerful combination of Vonage and AWS capabilities to provide a real solution that solves and addresses a real use case out there. So there's a lot of things happening at this moment, both in terms of commercial solutions coming into play, but also experimentation and sandboxing and things like that.
Speaker 1:Oh, it's exciting times today. It's great to see all those real world practical use cases and anecdotes and you know this is setting the stage for future development. Where do you see this industry and your participation in it? In a year or two, I imagine you'll have quite a suite of tools in the toolkit to help developers across the board yeah.
Speaker 2:so when we did this study that I mentioned earlier like when did this bottom-up developer study we saw that the need or the the network capabilities that can be valuable to developers, it crystallizes in four or five main areas and those are the areas we're working with. So the one that's happening first, of course, is the identity and security area. I talked about number verification. Sim swap has two APIs in that area. Why is that happening now? Well, it's because it's relatively straightforward to implement in the mobile networks.
Speaker 2:Most mobile networks have built in the capabilities already. That makes it possible, with relatively simple means, to expose those capabilities to voltage and hence to developers that's where the ecosystem starts capabilities to Vonage and hence to developers. That's where the ecosystem starts. And that chunk actually is very big as well in terms of addressable revenues around 25% of the total addressable market of 15 billion that I mentioned before. The next big area, so the biggest area overall, is really this quality on demand, where an application can make a service level agreement with the network, and that means is that it can demand and get confirmation of a certain bitrate or a certain latency or a certain reliability, and that chunk of addressable markets is around 40% of the 15 billion, so so it's by far the largest. In order to do that, that requires some technical features of the mobile networks that are not widely deployed yet, but they are available in several networks globally. It's called a standalone mode of 5G operation.
Speaker 1:And the use cases we see here is on the quality of demand API.
Speaker 2:We often think about mobile gaming and remote surgery or self-driving cars when we think about quality of service and those are important future use cases, don't get me wrong, but they are a little bit more futuristic. Where the developers say that they really see a need is, for example, in point of sales devices. Those are small transactions but extremely important in terms of latency and reliability.
Speaker 2:I mean the vendor has to make sure that the actual transaction goes through and the user must get the confirmation of the transaction in a very secure, fast and reliable way. So that's a big chunk of that. The other one is in the video and broadcast area. Both for video conferencing, like the one we're having now, you want to make sure that when you're on the move, that the video is done with high quality and good reliability. That's not the case on mobile networks today. But the other one is, for example, also broadcast when it comes more professionally. We show that Mobile World Congress, together with Sony, an application where they could use a regular SIM card, go to any location and start a high quality professional broadcast without having to use satellite trucks or SIM cards and so on, that like you do today. So in the quality of demand area, I think it's mainly or firstly it will be in those more mundane use cases, if you would like, point of sales devices, video broadcast, where it will start and then move over into more esoteric and more advanced use cases like the gaming and perhaps even the remote search in the future. Then the rest of this total addressable market that we are looking for as well is, I mean, one important area which is around 15% of the total addressable market is around location, and here we have a range of whatever you decide the range to be a kilometer or 500 meters or whatever your application requires and the network will answer with a simple yes or no. Next step of that is, of course, to ask for the precise location. So this is coming, uh, very launching it soon.
Speaker 2:However, this requires a little bit more from, not from the network, but from the interaction between the end user and the CSP, because this is very sensitive information that the CSP is sitting on when it comes to their customers, right? They can't just give it out without consent. The end user has to agree to provide this information, and that consent management has to be fully automated for it to be able to scale, and hence this is a reason why this is maybe a second step. And thirdly, we have all the network APIs that are related to the device itself, the status of the device, for example is it on, is it off, is it roaming? Where is it?
Speaker 2:And other things around the network itself. Is the network performing well? Is it congested? Does it make sense for me to even start an application now, given the network situation? How many users are in this particular area Now, with the forest fires in Greece. Maybe the authorities want to know how many people are in this particular area of the city and how many people do we have to evacuate, and so on and so forth.
Speaker 2:So what I'm trying to say is that you know, we're starting off with the easiest but very important use case of identity and security and then over the next months and years, we're going to add more advanced network APIs that allows developers and enterprises to build great applications beyond that in quality, on demand, in location and also in device information. So really exciting. We have a lot to do, I would say. So I really think this is great.
Speaker 1:Oh, it is great and it is exciting and it's funny how we get all so excited as developers and industry observers about things like iOS 18 and the new Apple devices coming out, but it's actually the network that drives a lot of innovation as well and so many opportunities for developers to take advantage of the devices and the networks to create extraordinary experiences. While we're in August but we're heading into September, It'll be a busy season in the industry events and meetings and get-togethers and launches. What are you excited about? As we head into the fall, We've got Mobile World Congress and many other events here in the US, Las Vegas and beyond. What's on your radar?
Speaker 2:No, I mean definitely, we have those events that you mentioned. We also have a number of industry events Kapowza in Amsterdam that are related to this particular industry, the hyperscalers, like Amazon, Microsoft, Google. They have their own events coming up during the fall as well, and they are key ambassadors for network API as well, because they have many developers related to them. So it's definitely going to be a lot of debate and discussion and, hopefully, buzz and excitement around the network APIs in the next few months.
Speaker 1:Well, I'm excited. I know you are, but I've been in this industry 30 years so I'm a total telecom geek, I think, and so are you. But I think it's really the consciousness of these opportunities is getting into the broader business-to-business world, so it's exciting to see. Thanks so much for joining and sharing an update and the vision.
Speaker 2:Thank you, it was a real pleasure.
Speaker 1:Likewise Thanks everyone. Thanks for watching and listening. Take care, Bye-bye.