NTT Communications Opens Nexcenter Labs to Drive Innovations Through Solution Co-creation

A. Amir

Summary Bullets:

• NTT Communications’ Nexcenter Lab enables enterprises and technology providers to co-create solutions.

• However, the facilities are only available in Japan while the partner ecosystem is still limited.

NTT Communications launched the Nexcenter Lab program in two of its data centers in Tokyo earlier this month to drive innovation through collaborations among the carrier, technology providers and enterprises. The program enables development and testing of new solutions leveraging the latest services and technologies offered by the carrier and its partners including HPE, Dell EMC, RedHat, Intel, Oracle, and VMware. It also offers enterprises a free use of its server racks and cloud services. NTT group is well known for its research and development (R&D). It spends around US$2 billion a year in R&D to drive innovations, and has commercialized various products such as corevo (AI-based platform), COTOHA (AI-based virtual assistant engine), and CLOUDWAN (SD-WAN). While the group has a Global Innovation Center in California (NTT I3) with a focus on collaborations among technology players (end-user involvement is only in the commercialization stage), the Nexcenter Lab program is more customer-centric by providing enterprises with an opportunity to co-create solutions from the initial stage by sharing real-world requirements as an input to the product developments.

Innovation lab has been a trend in the last few years. The co-creation of solutions through collaboration of various players across the ecosystem value chain is becoming crucial to address the growing complexity in enterprise ICT driven by the new technologies such as AI, IoT, 5G, blockchain, and cloud. As ICT role is moving from business support to digital transformation enabler, getting end-user involvement is important in developing a solution that addresses not only IT but also LoB needs. While there is a long list of facilities hosted by mainly system integrators, carriers are also adding more innovation labs across their footprints. For examples, Singtel has FutureNow Innovation Centre and Digital Transformation Foundry while Telstra has ‘Telstra Labs’ which consist of its innovation centers across its footprints. NTT Communications’ move to open the Nexcenter Lab is in line with the market trend, and closes its gap with competitors. The program not only drives innovations, but also offers benefits to both technology players and end users. The collaboration offers technology players with an access to end users to understand their real needs and challenges. It also provides enterprises with opportunity to trial new technologies such as AI and IoT before implementing them in their systems to gain competitive advantage as well as the conservative organizations that prefer to validate a solution in a test environment first before having it in their live systems. NTT Communications also differentiates itself from other facilities with its ‘open’ concept. The lab provides database of companies with their current activities accessible to all the program participants. This does not only drive innovation by bringing together technology vendors with similar strength and end users with common requirements, but also offers greater efficiency by minimizing redundant initiatives in the facility.

However, while the carrier has a plan to extend this initiative into other countries, Nexcenter Lab is currently only available in two of the carrier’s data centers in Tokyo. As a leader in Asia-Pacific cloud market (for more, please see Competitive Landscape Assessment – Telco Cloud Services (Asia), January 9, 2019), NTT Communications has over 100 data centers in the region (29 outside Japan). The carrier should consider leveraging its assets and brand in its other key footprints such as Singapore and Hong Kong to extend this initiative and strengthen its regional presence. As NTT Communications is merging with its sister brands, the carrier should also consider leveraging other NTT’s facilities such as Dimension Data’s Client Innovation Center (CIC) in Sydney, and streamlining its initiatives within the NTT Groups (e.g., making the activity database available across different facilities). It is also important for the carrier to include the hyperscale players, network vendors and IoT partners such as AWS, Azure, Alibaba, Ericsson, Huawei, and Nokia, to add more use cases especially in public cloud, IoT, and 5G.

 

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