“Business as a Service”, one step closer to the digital cloud

New business models are now possible, especially in the field of telecommunications players. Business as a service solutions fit into these new models

The cloud and its many variations “as a Service” (Infrastructure as a Service, Platform as a Service, Software as a Service) are already in use. “Business as a Service” (BaaS) is a new version aimed at IT and business processes. This service provides business customers with a white label platform where they can outsource all their business processes: Customer Relationship Management (CRM), packaging and pricing of quotes, order management, invoicing and administration, payments, etc. “Billing as a Service” or “Cloud Billing” is one of its components that focuses exclusively on outsourcing billing and finance-oriented processes. BaaS adds to this that the ability to orchestrate multiple offers from different partners and manage those offers and their customer base.

BaaS is modeled after the B2B2X model and enables flexible management of all the mentioned business processes. BaaS gives players in all activity sectors the opportunity to seize new opportunities that traditional IT solutions have not provided the opportunity until now. Current economic models are thus set to be gradually replaced by new ones, which will largely depend on BaaS’s ability to formulate and bring together the various services in the ecosystem from its suppliers and partners. There are many potential customers in the automotive, energy, supply, retail, healthcare, etc. sectors.

Companies in all sectors are saddened by the ongoing digital revolution. The revision of the customer relationship towards a more digital model as suggested by Salesforce.com is only the tip of the iceberg. The business activities of all companies will be turned upside down by the digital, and BaaS is thus promised a bright future: valued at $ 2.4 billion in 2013, this market can represent almost $ 10 billion.[1]in 2018, i.e. almost 32% annual growth.

In terms of customer benefits, BaaS minimizes the time for marketing and revenue generation of services. Outsourcing can reduce the resources needed to manage and maintain solutions. In addition, BaaS has the advantage of great flexibility with configurations that can be changed in real time and an open system designed to integrate new partnerships over time.

BaaS’s economic model is intended to reflect the service’s image: flexible for its customers. The implementation costs are very low compared to investments in “classic” solutions. The total cost of the service, including operating costs, also remains much lower than for a traditional solution. The price model that can be scaled according to activity level (“pay-as-you-grow”) essentially comprises two types: “retailer” model with a margin per. transaction or resale purchase model, classic in wholesale activities, where the supplier himself determines the prices offered to end customers.

Different types of players are positioned in this market and offer more or less complete solutions: Integrators, software vendors and telecom operators. Among these, operators are particularly legitimate players due to their historical ability to manage the billing of complex and evolving services to tens of thousands of customers and their ability to package them with other service blocks such as CRM and Analytics. However, their current billing systems are often too complex and not agile enough to allow the transparency to third parties that BaaS requires. The implementation of an overlay that integrates into their existing systems is then particularly relevant.

This is the position of the British operator BT, which is a pioneer in this field. BT recently decided to strengthen its position in cloud computing services. The operator has chosen to enter into a partnership with Infonova to implement and manage its cloud solutions in twenty countries over the next five years. The Infonova R6 platform acts as a supporting abstraction layer for this ecosystem. The solution chosen by BT offers three key features: a turnkey “concept-for-cash” solution that provides simple and fast revenue generation of new offers; a solution built-in designed to be fully configurable by its end customers by having access to the entire ecosystem; and finally an agnostic solution that allows interconnection of all types of upstream customer offerings. By relying on this platform, BT can e.g. offering customers in the UK utilities deals at a cost about four times lower than a traditional IT solution, while allowing them to accelerate their digital transformation.

Jean-Michel Huet, BearingPoint Partner

Olivier Darondel, BearingPoint Manager

Sebastien Cazuguel, BearingPoint Consultant

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