Kerton: World's biggest telecom operators ask for innovation

liz kerton

Liz Kerton

In case you missed TC3 last fall, a summit between the world's most innovative telecom carriers and Silicon Valley innovators, 40 global telcos were brought together by the Telecom Council to talk about their innovation roadmaps for the next few years and lay out their current innovation needs in black and white.

Unlike most interactions between early-stage companies and telecom operators, where the operators sit and listen to new ideas, TC3 puts those carriers on the spot to give specific, actionable, direction to the companies and entrepreneurs who are building the next set of innovative products and services for the communications networks. At TC3, all the telcos answer these questions:

1)      Why should Silicon Valley choose to work with your big company over others?

2)      How would I engage with your large company, in detail?

3)     What are your actual innovation needs?

At TC3, an unusual format is used. Every carrier that speaks, of the more than 20, is asked to include a template slide in their presentation. This slide is a one-page summary of the technology gaps or "needs" of the carrier. A close look at this information shows where the different telcos, coming from different regions, are the same, and where they are different. When viewed in aggregate, TC3 attendees get a clearer picture of ideas or technologies that represent a trend across many carriers, and which technologies are niche and apply more specifically to one carrier over another.

Armed with this information, entrepreneurs who attended TC3 can better shape their efforts. VCs, for example, could choose to double down and invest in technologies that seem to be part of a growing trend. Startups may choose to pivot slightly to reshape their technologies to fit their market's needs. Startup Business Development people may choose to refocus on a different region or specific carrier because of a regional niche they weren't previously aware existed.

Because this information can be very valuable to entrepreneurs worldwide, and because the Telecom Council's ultimate goal is to help innovation get to market more quickly, the Council has chosen to offer the information freely, even to those who did not attend TC3 and/or not Council members. All of the carrier's key slides are available for download from the Telecom Council:

Carriers are a very desirable target for startups. They have massive reach, wide distribution, access to pre-installs on phones and the networks themselves. Also, with customers who pay a bill each month, the carriers are a huge collecting point for the money in the telecom market. This makes carriers seem like a great potential channel for entrepreneurs.

Despite that promising objective, any startup intent on making a deal with a carrier should also be well-aware of the downside: much like getting VC funding, there is a funnel where a carrier will meet with hundreds of companies, but only make deals with about a dozen of those. Startups that go in with this knowledge will have better chances of success, and will leave less jaded. Carriers are slow, especially by startup standards. Deals can take up to a year to materialize. If you are lucky, a pilot project is the first step. A carrier deal can put a great deal of pressure on your engineering and operations. Scalability will almost always be required.

Because of the above, entrepreneurs who self-filter themselves and research their targets before choosing to pursue a carrier deal actually have a much better success rate. How can you filter yourself? Be honest. Get outside opinions. Use advisors. Participate in the Telecom Council. And use the free aggregate of carrier "call for innovation" summaries being offered here.

Liz Kerton, managing director of the Kerton Group, is one of the Silicon Valley's most influential women according to the San Jose Business Journal.  Kerton is a marketing expert focused on technology and telecom. She started Telecom Council of Silicon Valley in 2001 - a community of 1000s of telecom industry insiders from 100s of companies including 60 global telcos who are focused on telecom innovation. 10 years later, in 2011, she started the Autotech Council which connects auto makers and their Tier 1 vendors with innovation and entrepreneurs.