Charlotte Kan, TelecomTV (00:17):
Welcome back to Extra Shot with Your Live, just about end of day one, nearly the end of day one. Live from Windsor, of course, for the DSB Leaders World Forum, where I'm delighted to be joined by Chris Lewis, managing director at Lewis Insight, and Martyn Warwick, who's co-founder and editor in chief of TelecomTV. Welcome to you both. Thank you. Many rich discussions happened here today. We've talked about how to drive growth in the telco sector, AI and network automation, cloud native teams, how to create them or encourage them. Not that easy based on the conversations I've heard and building infrastructure, digital infrastructure from core to edge. So Martin says, we've heard from Chris already who's graced this stage, if I can call it a stage earlier today. We've seen you on stage actually earlier. We haven't heard from you yet, so I was wondering if you could share your key takeaways of the sessions we've heard here on day one of the

Martyn Warwick, TelecomTV (01:13):
Forum. Yes. Okay, then, well, to begin with, I think it was a particularly good day, not least because the balance between the number of telcos here and the number of vendors and other interested parties are very close, 50 50. So we didn't hear a lot of pitches as it were from vendors. We heard questions to and from telcos talking about what they want and what they need, and Bender responding and saying, this is how it might be done. I think that's very important, very unusual to be able to get that kind of balance. From my point of view as a journalist, I think that interests me most with the first two sessions this morning, innovation, which is, oh, they've been banging out drum since Noah was a boy, and also the ai, which I'm particularly exercised about because it gets a bad press. So those are the two things that interested me the most this afternoon on a personal level, a little less, but very important nonetheless, but not my bag particularly.

Charlotte Kan, TelecomTV (02:08):
Okay, Chris,

Chris Lewis, Lewis Insight (02:11):
I'm going to take it straight to the end of the day then, because I thought the last session on infrastructure and getting the infrastructure out to the edge absolutely summarizes the challenge the industry has, which is that we have been a very centralized industry and we've tried to dictate the way things are done and the way products are developed for the customers, and actually by the emphasis moving towards the edge, it emphasizes the fact that what is required at the edge is not just connectivity, but security analytics, all the things that go to make up the services, the digital services in the DSP that we all need. And that's a big shift from an investment point of view, from a management point of view, from an operations point of view. And I think that fundamentally is the change in direction that the telco industry has got to embrace because AI will contribute to that.

(03:02):
By the way, I don't think it's a totally bad press. I think it is been overhyped, and I think it is talked about in too many areas rather than the practical application of ai. And I think innovation similarly, that telcos can't do it all. They're no longer their own ecosystem. They're part of a broad ecosystem. And if innovation will come in from other parties, whether it's from the people designing the chips or the people even delivering the security and platforms, in fact, one interesting thing that it did occur to me during the last session, Charlotte, was that the way in which the other parties in the ecosystem, so the people building their own platforms, whether it's a Salesforce or a Cisco or many others, it's about telcos adapting their way of behaving to embrace those things rather than try and compete with them. And I think previously they've tried to compete and try to control, and I think that mood to the edge sort of democratizes telecoms a lot, and hopefully we'll get it thinking a bit more broadly about its role in that broader ecosystem.

Charlotte Kan, TelecomTV (04:04):
So it's empowering. Martin, I just want to go back to what you've just mentioned actually around innovation. The industry was at the forefront of innovation for many decades until obviously tech companies started to come up with new solutions, new products, et cetera. But what we've seen today is lots of discussions around the convergence of many different technologies. And since Chris also mentioned mindset, it seems that what's important is to work on the culture and create the right environment for innovation to thrive. So how do you go about that? Well,

Martyn Warwick, TelecomTV (04:36):
I think Neil McCray hid it on the head really by saying these were, it wasn't Neil, sorry, whoever sat next to Neil who said, these were all in the past sort of monolithic state owned enterprises. And that still to this day prevails a mindset can prevail in many of these organizations at telcos that is a reflection and from the ancestor that they came from. And that's something that's been very, very difficult to shift, tried very hard in many ways, and it's succeeding, but it's succeeding more slowly than might've been anticipated considering the bt, for example, was privatized back in 1984, so are looking at 40 years and it's taking a long time.

Chris Lewis, Lewis Insight (05:20):
That was the year I came into the industry, by the way, 1984, was it? Yeah, just 40 years. But I think there's a big, and the geopolitical point is really important because the Chinese and Co have taken a market and restructured it to do the best for delivering 5G and fiber. The Americans have got sheer scale with their major players. They've done it through the capital market, if you like, and Europe sort of been caught somewhere in between the two by regulation trying to control it or guide it a little bit. But actually it stifled it too much competition. And in fact, the point made by I think Francesca and Co at the end there about actually we need to have some more form of sharing between the participants. We shouldn't all be building separate networks. I know the vendors might not like that. They obviously can sell to separate people, but actually the ultimate economics of this industry will end up with much more sharing. I don't think it'll go back to the monopoly that we had pre 84, but I think we will get a lot more sharing, a lot more structure in the market.

Charlotte Kan, TelecomTV (06:19):
But the sovereignty issue is an important one, important consideration indeed. Now, in terms of the challenges faced by the sector, we know that there are plenty of them, indeed. And last year I remember lots of conversations around skills. We talked about them obviously during the sessions we've had today, but maybe not as much as last year, I'd say. Why do you think that is? And also, I mean, surely, I mean, skills upskilling and finding the right skills and attracting new talent is a big challenge for the

Martyn Warwick, TelecomTV (06:45):
Industry. It is. And I'm not sure about increasingly so, but still. So because to recruit people or to have people in your organization that you can reskill, you can see where the talent is to be able to do that. It's quite a long-term process. You have to know what's going on. They have to understand it, then they have to be trained and educated to reach that point. And it takes a while. And as in most of these things, you can't turn it around in 12 months.

Chris Lewis, Lewis Insight (07:12):
No, and I think that point was made in one of this morning's discussions that actually it's more important the long-term goal. And let's face it, most telecoms investment is long-term. We get sucked into the quarter by quarter discussion, and that's just not really appropriate for our industry. But the long-term is actually getting the education systems right in countries. So kids coming through school actually want to get involved in this, and they find interesting to be involved in coding, to be involved in developing digital services. And I think that's one of the long-term pushes. The other point I'd like to touch upon Charlotte is that in all of the discussion that we have, and this is the way this industry tends to deal with it, I didn't hear very much about the actual changing product that we deliver to the customers. Now, I know we've got a session at the end of play tomorrow, which be a nice way of wrapping it up, but all the way through as we move all these pieces around from the center to the Asian, distributed and so on and disaggregated, does it change the product that you and I use Martin or that are business users?

Charlotte Kan, TelecomTV (08:10):
Very good point, indeed.

Chris Lewis, Lewis Insight (08:11):
I'm not sure it does. So I'm very interested in tomorrow's session and seeing how we might think about really shifting the emphasis to the customer rather than the tokenism, let's say, of customer experience in the past.

Martyn Warwick, TelecomTV (08:23):
You came into this back in 84. I came in 91. What about the emphasis on the customer then? And surely it was the same. We deliver this, the customers central to everything we do, certainly became more and more of that in recent years.

Chris Lewis, Lewis Insight (08:36):
It was a dictatorship, right? It was a dictator.

Martyn Warwick, TelecomTV (08:39):
You will do this. We will buy a switch. You will do this.

Chris Lewis, Lewis Insight (08:42):
Well, no, I mean, no. And I'm thinking about the end products,

Martyn Warwick, TelecomTV (08:44):
End

Chris Lewis, Lewis Insight (08:46):
Co and you paid by distance, and we used to have a lock on the dial on the telephone. I

Martyn Warwick, TelecomTV (08:51):
Remember those recording long

Chris Lewis, Lewis Insight (08:52):
Distance. So I mean, so much has changed, but we haven't really shifted over to the emphasis being on the customer and what the customer's doing. And I think Nick Willis mentioned this notion of shifting from an inside out model where it is defined by the technology to an outside in one we're defined by what people and customers and businesses and society are doing with the technology and with the service. And that's where we've got to get to. And that will redi dimension the whole industry and change the way we think of telcos and IT companies and digital service providers.

Martyn Warwick, TelecomTV (09:24):
I agree. That question is, but when,

Chris Lewis, Lewis Insight (09:28):
Well, Martin, if I was an analyst focusing that sort of thing, then Oh yes, I am precisely. It is such a long-term business, and I think we touched upon it this morning in some of the geopolitical discussion that the global players, the hyperscalers, the equipment players, they have the global capacity, they have the CapEx, they have the ability to lock jobs off as well as create new jobs all the time. And the problem with AKAs is ultimately they are tied down to a national footprint, admittedly sometimes with multiple national footprints, which has some relevance to government activity. And I think the government did come up on a couple of occasions thinking about how government should be responsible. And I just think this is at least a 10 year journey. It's not a five year journey. It's at least a 10 year journey.

Charlotte Kan, TelecomTV (10:17):
Okay. I'd like to wrap up and conclude our conversation on a high note, if possible. Have you heard anything particularly exciting today? Any exciting developments that you'd like to share with our audience?

Chris Lewis, Lewis Insight (10:32):
I think what I did like about the discussions is that it's much more practical. And as an analyst, we get presented with so many new technologies, new pictures, and people trying to make you excited about it. I think what you heard from all the telcos on stage today was a much more pragmatic view as to where their investment is, where they're going, and not getting too overly excited because I don't think the end product changes that much. And I think accepting the relative role of the telco in that broader ecosystem is really important. Some, and I think we had a discussion about some pockets of innovation, some pockets of really pushing that into other markets are happening, but it's very much contextualized within individual telcos in individual countries. So I think summarizing on a global level is dangerous. I think that's why we often get quite down about the state of the market. There's no major growth, but we are seeing movement in shifts in the investment cycle, shifts in the way the investment community looks at telecoms, this stratification looking at towers and infrastructure. And I think we are seeing a much more practical view the way telcos will evolve into whatever we call it in the future, the XSP, I think rather than the DSP.

Charlotte Kan, TelecomTV (11:44):
So excited about the fact that we are more realistic.

Chris Lewis, Lewis Insight (11:48):
Absolutely

Martyn Warwick, TelecomTV (11:49):
Nothing earth shattering as far as innovation is concerned, but a steady progress, I think, I mean, 5G has been around for five years now, still not where it should be except perhaps in some private networks. Six G has been hyped so much in the past year, and the hype cycle can't get much higher. It'll disappear around the moon summer. It's just crazy. And so that needs to calm down, and we're seeing it calm down, I hope and think. But it is an incremental process. And as Chris says, what we're talking about with this industry has always been 10 years, 15 years, always to make these major changes, long

Charlotte Kan, TelecomTV (12:29):
Cycles.

Chris Lewis, Lewis Insight (12:30):
And one last comment, if I may, Charlotte. The way the stock market, the way the financial, the investment community, look at telecoms, they considered it a commodity stock 20 years ago. So we've kept on this myth that it's this fast growing, changing industry, whereas actually, once again, reemphasize the point. So yes, Nvidia and co chasing quickly the Cisco's in this world, the rack, but they'll chase things quickly. But actually the fundamental telecom industry does not change that dramatically. And even setting down towards that fixed and mobile convergence that we talked about how many years ago, Martin? God, A long time, at least 20, 30 years ago. So I think it is a more, it's a more measured approach, a more sensible approach. And that's what you see. Obviously, the stock market don't get overexcited because there isn't anything to be overexcited about in terms of growth, but it will keep on delivering, keep on supporting. In fact, in a recent piece I wrote thinking about 40 years in telecoms, I said that telcos always want to be the superstars, the stars in the film, actually, they're a supporting actor. They're playing a supporting role, supporting this new adventure, this new film that's being created, the new content that's being created. But it's a supporting role. It's not the glitz and glam, it's not the limelight role that they might've thought they had in the past.

Charlotte Kan, TelecomTV (13:40):
Okay. Well, thanks to both of you for your insights. Hopefully we'll talk to you tomorrow. There's more to come here from the DSP Leaders World Forum live from Windsor. Of course. Join us again from 9:00 AM UK time. Of course, we'll have more co-host, small CSP LED discussions, and of course, more extra shots. So don't miss it. See you tomorrow.