Telco Sings the Blockchain
Back in the summer of 1960, American singer/song writer Sam Cooke released the hit song Chain Gang. A classic, the song is about the punishing work of prison chain gangs, and about how the load of the work was shared and distributed among the members of the gang as they worked in unison. While prison chain gangs are not immediately obvious as an analogy for emerging technologies, the relevant concept of that song is the work that all links of the chain performed (and also how chain gangs were distrusted by the outside world.)
Enter the year 2018, and a new chain gang is emerging as the tech of the future: blockchain. Originally created for the crypto-currency Bitcoin, blockchain is emerging as the future of distributed systems. This new technology could change the Telco space as much if not more so than the first mobile explosion wave in the 2000’s.
How, you ask?
Blockchain has the properties to allow for more agile, open, distributed data control and enhanced security. It has the capability of opening up new markets for the internet and the increase the need for higher speed connections points. In short, it can change the very landscape of the tele-communication industry both internally and externally.
What is Blockchain?
Blockchain as defined by Wikipedia: “A blockchain is a decentralized, distributed and public digital ledger that is used to record transactions across many computers so that the record cannot be altered retroactively without the alteration of all subsequent blocks and the collusion of the network.”
While blockchain itself isn’t simple when you peek under the covers, the basic idea isn’t too hard to follow. It’s basically a database that’s validated by a wider community (distributed ledger if you will), rather than a central authority. It’s a collection of records that a crowd oversees and maintains, rather than relying on a single entity, like a bank or government, who typically host data in a single database, most likely residing on a particular server.
Each “block” represents a number of transactional records, and the “chain” component links them all together with some form of hash function. As records are created, they are confirmed by a distributed network of computers and paired up with the previous entry in the chain, thereby creating a chain of blocks, or a blockchain.
So, each block represents a link in the chain and work in concert with the other links all singing the same tune. “That’s the sound of the blocks, working on the chain gang.”
Blockchain looks to change how systems are seen and managed, and with a little forethought will bring about another major agile shift in tomorrow’s technology.
Blockchain in the Telco Space
In the Telco space, blockchain looks to help bridge gaps and remove some of the middleman barriers and costs. Ever drive outside your mobile coverage area and get hit with a roaming charge? Well, imagine a system where roaming charges are a thing of the past and your mobile device, once logged into the mobile network, will act and be seen as a local device. Devoid of roaming charges and massive fees. Here is how it works: the user selects a local provider from the app. Selects the plan that is right for the user during their trip. The creation of a smart contract is initiated via blockchain, so all transactions are guaranteed, and the user is authenticated. The user connects to the local carrier and now runs as a local device on said carrier. No roaming charges or middle man to pay or work with. One such company on the forefront of this movement is bubbletone.io. Bubbletone is looking to be the first decentralized telecom ecosystem that will allow mobile network, operators, phone owners and service providers to interact with each other directly.
We believe Network Functions Virtualization (NFV) and NFV management are the future to the Telco industry: software defined networking and NFV will surface as the leading agile platform change. But, while NFV will provide faster and easier manipulation of the communication network, since it is software-based it has the inherent nature of being hackable, and has the centralized management nightmares associated with these types of systems.
Enter blockchain. By building out a peer-to-peer network with inherited security adaptation (block and hash algorithms), a decentralized neural network with enhanced security can be created, allowing the communication network to move and bend with the needs of the consumer.
Since blockchain is a distributed model, other areas that might benefit from this technology in the Telco space may include (but not be limited to):
- Interconnect management
- Registers of numbers / spectrum
- SLA management
- Micropayments for services
- Off-grid IoT & LPWAN
- Smart contracts for enterprise
- New media distribution models
VMware has been conducting research on blockchain for several years. Last May, VMware veteran Michael DiPetrillo was appointed as senior director of blockchain and was tasked with determining how the company might develop blockchain into a proof-of-concept (PoC) project for customers.
DiPetrillo said the problem VMware is hoping to solve with blockchain involves scenarios where some type of third party is needed to federate information or data. For example, Telecom companies that have to share customer phone records for portability use a third party to moderate and handle those records. “But that adds latency to the whole process,” DiPetrillo said. “And it adds costs to the customer.”
Instead, with blockchains federated and protected distributed ledger , a company simply can add software and systems to build out applications that require federate information or data with another company SDXcentral.
So, for Telcos, blockchain could have them singing a new verse of Sam Cooke’s iconic song: “That’s the sound of the money moving on the Blockchain.”
Jerry Maldonado is currently an Advisor Strategist for VMware who specializes in helping customers move into the digital economy. Jerry provides customers with insights around their needs for Cloud, DevOps, IOT, IT Operations, Blockchain and Business Strategy. Jerry has 30 years of hands-on and management experience in the technology industry, and has architected and deployed some of the largest IT systems in the world.