Dubai Eye is the premier talk radio station in the United Arab Emirates. Its flagship programme, The Business Breakfast, spoke to BT chief technology officer Matt Bross in February to discuss innovation, transformation, and the issues affecting the local telecoms market in the UAE. What follows is an extract from a conversation that covered innovation, telecoms transformation, BT’s 21C Global Venture and the local telecoms market in the UAE.
BT used to be a monopoly telecoms provider in the UK, and now you’re not. Etisalat and Dubai is about to undergo the same transformation. How hard is that change process?
Matt Bross: “The process has been underway for years at BT, and I would say that we have really broken free from the legacy of being a telco. We are now a global networked IT service provider, where the predominance of our growth happens outside of the UK. So the challenges are really of heart and mind, to be able to get the men and women inside of your organisation to understand that they’re becoming a service organisation…that they need to drive innovation in ways that they had not done before.”
“So that process will take some time, but BT has actually launched a set of services we call the Global Venture to try and help companies around-the-world go through that transformation to next generation networks, and through the transformation from the regulated world to the unregulated world.”
One of the areas you’re very concerned with right now is the 21st Century Network transformation… what is it that this programme entails? What are some of the examples of what you’d be bringing to the UAE or bringing to the telecom operators?
Matt Bross: “Well in its simplest terms, networks of large global operators have built up over the tectonic shifts of time, regulation, technology change, global expansion and contraction. And what the 21st Century Network does is build, out of next-generation network technologies, the ability to collapse all of those legacy infrastructures into one simple, global IP infrastructure. Translated into business terms, it allows you to get new services into your customers’ hands faster than you could have ever done before.”
OK, so what would one of those new services be?
Matt Bross: “One of the ones that BT has pioneered, we call it BT Fusion: the ability to take an actual mobile device, embed a Wi-Fi modem in it – a Wi-Fi, wireless device – and any time you walk into a location, a hotel or coffee shop that has wireless, you move off of the mobile network and your call becomes a Voice over IP call, so the world becomes your office if you’re a business traveller.”
You’ve billed that as the biggest telecoms innovation project in the world.
Matt Bross: “We are investing, globally, $18bn in the 21st Century Network. The programme is a 5-year programme…the fact of the matter is, the 21st Century Network is actually an investment not only in networks, but systems and the way that we do our customer processes as well.”
One of the issues becomes the innovative process to get these kinds of systems in place. Do you also see yourselves as an innovation company now?
Matt Bross: “BT is driving what I call ‘open innovation’. If you harken back to the regulated days of yesteryear, when all the innovation was done from within the company, we’ve turned that inside out into open innovation. And we’re seeking innovation from wherever it takes place on the planet, and fusing that together with the best of the men and women inside of BT. And that model, of moving from closed innovation to open innovation, is really getting a drumbeat of innovation to our consumers and into our global multi-site, multinational customers, that I don’t think is actually replicated by any other operator on the planet.”
Are you also positioning yourself as an exporter of R&D to companies and countries that can no longer finance those operations?
Matt Bross: “In fact we are. In June [2006] we launched our Dubai office. BT has been operating here in the region for over 30 years, and in Dubai for over 20 years, but the launch of that also heralded in what we call our 21st Century Global Venture. And the Global Venture is an effort whereby BT is taking the knowledge that we’ve accumulated and helping telecom operators around-the-world upgrade their infrastructures to next generation networks, so they can better serve the local market and their multi-site, multinational customers. We see that both as a huge market opportunity and an ability to drive innovation deeper into the markets where we see growth.
In your local office here, you’ve had revenue growth over the last couple of years of 53% and 76%, I think it is. But in many ways you’re actually growing from a fairly low base: you’ve come a bit late to the game, even though BT 20 or 30 years ago, were some of the initial outside consultants on the local networks put in here, when everything was designed to British standards. Do you feel that you were here, you walked away and have come back…?
Matt Bross: “I think, Malcolm, that the pendulum swings. BT today, if you take the last three years, we’ve signed in excess of $39bn of new contract value for global, multi-site multinational networks. That business has taken us into all corners of the world. So I’d say that we have never left the region. The ebb and flow of global expansion and contraction has probably had us have less presence here, but with over 150 people in the region today we’ve had a constant presence over that time.”
Who’s your main competition these days in this area? Do you have any competition?
Matt Bross: “Certainly. In the global networked IT space there are many players who see this as a growth area. Here in the Middle East and Africa we see it as a $2.5bn addressable market for BT, and the ability to attack at least 10% of that market seems pretty reasonable.”
Given the demographics of the Middle East, how do you tap into that youth that is capitalising on some of the applications that you will be putting forward, and these ideas that are coming out of BT?
Matt Bross: “There’s an inversion in innovation taking place here that I think is kinda interesting, kinda cool. In that, you used to think that all of the innovation came out of corporations, and as it was cost reduced it moved out into the consumer realm. What you’re seeing today is some of the most advanced communication services being put into the hands of kids and individuals, earlier.
So there’s this inversion where companies are looking to say, hey I’ll have some of that. And when you look to the workspace of the future, they’re going to be working like our kids are doing their homework today. So, what that does in our open innovation model, we’re taking and looking at those models, those ways of working… nobody’s got a crystal ball on what customers want. And often times customers don’t know what they want, but they’ll always know good when they see it. So the challenge is to put innovation together quickly, and let customers vote with their wallet.”
You can listen to the complete interview here.
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