25 Jan 2012

Network APIs - the foundation of innovation

Mark Windle, Head of Marketing at OpenCloud, explains how operators can perfect the introduction of network API exposure

As we turn into 2012, mobile operators all over the globe are facing an increasingly competitive market environment.

Not only do they face stiff competition from their peers; but also pressure from Over The Top (OTT) rivals; who are riding for free over their networks to deliver services that sometimes compete with and ‘cannibalise’ those offered by the operator themselves. The constrictive nature of the market also means that their costs are being squeezed. Subscribers are in the same position too and require convincing of the value of new offerings, before parting with their money.

One solution that can help operators prosper in a tough market environment is to leverage innovation. This can allow them to differentiate their services from rivals and provide exciting new services to end-users that offer real value.

A tactic that can support such innovation from the broad global developer community is for operators to expose network functionality through APIs. This solution allows the operator’s differentiating assets and revenue generating capabilities to be brought into play.

Apple’s AppStore and the Android Market underline that an open and independent developer community can be a vibrant source of continuous diverse innovation. However, opening the network to third party developers comes with risks and operators must take care in leveraging network APIs to nurture innovation.

Leveraging and unlocking creativity

Industry initiatives to define a commonly supported set of lightweight, web friendly, APIs which could allow operators to expose useful network information to developers, such as the GSMA’s Wholesale Application Community and OneAPI, have not been very practically effective.

They have suffered from a running problem in telecoms – decisions being made by committee. This has resulted in a very laborious and prolonged process that has ensured that any deployments have taken years. In a rapidly moving market, this process has been too slow and has not adequately supported developers. For example, look at internet players such as YouTube, Google or Twitter. These companies act independently and can rapidly and flexibly expose their APIs to allow for the rapid development, and launch, of innovative services.

At a high level, operators can benefit from collaboration and interworking on network API exposure. However, this can be done after services launches – removing any delay in going to the market. To stimulate development from network APIs, operators need to be more independent and decide what works for them. Operators need to stray from the script and write their own one; especially as the competition in the market is increasingly fierce.

An example of a successful network API approach from a mobile operator is Telefonica’s BlueVia. The world’s third largest operator launched the development platform last year; and it enables developers to write either applications or mobile websites and tie them into APIs ranging from billing to user profiling and even customer usage patterns. BlueVia can be used for free by developers; and the revenue breakdown for what the developer can take home is 70 per cent if their application is hosted in Telefonica’s own App Store, 70 per cent of subscription fees if the app uses recurring billing, 20 per cent of incoming SMS fees and 10 per cent of outgoing SMS fees.

Care is needed

The disappointing fact is that this is the only stand-out example by mobile operators on successfully, exposing network APIs that can be showcased. Put simply, more operators need to dip their toes into the water and try approaches like BlueVia to expose network APIs; and leverage the development community to promote service innovation.

This is a win-win scenario, as the innovation model enabled by Blue Via is low-cost. With little investment from the operator, newly launched services or apps that fail to gain market traction pose little financial risk. However, in exposing network APIs operators must take great care.

T-Mobile USA discovered this fact last year: The operators’ network performance was impacted following the release of an Android-based IM app that reconnected with its network so often that it caused network signalling overload in certain densely populated areas, affecting the availability of all types of service, for every subscriber in that area.

Caution on fraud

Fraud also tends to increase in tough times; and the mobile space is no different. Fraudulent applications on mobile networks are on the rise. Indeed, the Google’s Android Market store recently featured several seemingly legitimate ‘free’ versions of premium titles. However, the applications contained malware – which then sent premium-rate text messages to users. The apps were downloaded over 10,000 times. These sorts of frauds, that abuse a phone to dial or text premium numbers without the end-user being aware, are particularly prominent on mobile networks.

For operators, the balance between app and service innovation, and keeping the network secure and fully functional, is crucial. Operators should explore supporting independent innovation securely through a tiered developer hierarchy.

For example, at one extreme is the extensive, but risky, global developer community and at the other are selected groups of very low-risk in-house developers. In between these two groups, are the trusted third party developers. Each group of developers should then be supported by the operator through a different set of APIs, with a scaling level of network access and capabilities. These APIs would be based on how much trust the operator has in the developers concerned.

Between them, this diverse pool of talented developers can provide the range of innovation that the operators are seeking. This could be from the popular ‘Angry Birds’ type of app, down to protocol intensive, revenue-building, roaming services or enterprise mobility solutions, for example.

Framework for the future

A tiered developer ecosystem helps to manage the risk of exposing network APIs for the operator. At the heart of this system, underpinning the whole operation in fact, there should be a flexible, open standards-based, service layer framework that can safely coordinate network assets and protocols to developers.

To encourage third party developers to innovate, the expert knowledge traditionally needed to build telecom services needs to be replaced with something much simpler and familiar to developers. The open-standards based service layer framework not only provides a secure way of exposing and allocating network APIs; it also provides this translation and makes it very simple for developers to produce exciting new services and applications.

The key to this easy-to-use approach is that each simple, API can be used to mask the underlying complexity, such as interacting with a location server, a messaging centre and the charging system, for example.

By wrapping up complexity within simple APIs, greater numbers of innovators can participate and at the same time, risk is reduced as the network interactions are entirely controlled by the API. The process does not have to be deep; the service layer framework simply provides the flexible toolset required by the developer to produce services and apps. Moreover, the system can then provide APIs that allow the new service to be safely and securely linked into the operators billing system so that charging for the service can be catered for as well.

The service layer framework also allows network APIs to be focused on the task that the developer needs them to be – they can be as rich and deep, or lightweight and simple, as is needed This therefore requires that the service layer framework flexibly connects to a very wide variety of network elements.

Making the move

In light of the extreme competitive pressure, and constrictive and crammed nature of the market, operators need to find more routes to differentiate their offering and improve their attractiveness to consumers. Innovation is one way to do this and operators can take the initiative on network APIs. Operators should experiment and see what works for them with networks APIs, without having to rely on a slow moving industry collaborations or undertaking a commercially risky move.

A successful, flexible, safe and easy-to-use system to expose network APIs should be the beating heart of this programme. This is where an open-standards based service layer framework is crucial. This platform takes the complexity out of network API exposure, but also ensures the process is flexible, supports developers and is secure in terms of the operator network.

Using this system is also very low-cost, so the operator can be bold with new services they launch into the market. The service layer platform allows the operator to unlock innovation from all tiers of developers, enabling them to nurture the inherent creativity of that community.

This freedom to innovate can ensure that operators deliver real differentiation of services and applications to drive their revenues and attract, and retain, customers. A system of exposing network APIs, leveraging an open-standards based service layer framework, can deliver the exciting services that consumers are crying out for.

New innovative offerings can help operators to level the playing field with their faster moving OTT service provider rivals; and regain their competitive footing in the market.

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