XaaP! It’s the Platform Business Model

rsz_platform-book2As the title suggests one way to approach the ‘Platform Business Model’ (described in detail in our library section), is to consider how it is being adapted for specific industry sectors, via Cloud-centric anocronyms such as:

  • GaaP – Government as a Platform
  • BaaP – Banking as a Platform
  • TaaP – Telco as a Platform

With a key goal of describing practical aspects of the trend and of course our Cloud focus, this aspect is one of the headline themes of our Platform ebook.

The agenda will include these specific industry scenarios and we’ll explore them to illicit the key ingredients of a common Platform Architecture.

GaaP – Open Government, as a Platform

This tailoring began simultaneously with the emergence of the model itself, as the earliest of thought leaders like Tim O’Reilly seized upon its potential for transforming IT across all industries, not just the ‘digital natives’.

In Chapter 2 of Open Government Tim first coins the term Government as a Platform, describing how traditional IT for government should become more like Facebook, Twitter and the other Internet pioneers who have been harnessing the evolution of the Cloud to become ‘platforms’, doing so for government would enable a shared infrastructure that enables more rapid digital transformations.

Diego Lapiduz (Twitter) epitomized the trend, showcasing his work at the 2015 Cloud Foundry summit. He comes from the IT tech innovation sector and wanted to make a difference by applying these types of skills to public sector needs, one of the first results being the launch of Cloud.gov, described as “the Government Innovation Platform”.

This is an implementation of Cloud Foundry, intended to provide one immediate building block for this GaaP vision, as it is literally that, a PaaS – Platform as a Service for government agencies, quickly bearing fruit such as enabling more than 300 new developer apps.

gaap1Global adoption

This was then picked up on by early pioneers within local markets, for example the UK in particular was quick to base their own ‘departmental brand’ upon their ideas and work in this area.

Mike Bracken, Executive Director for Digital in the UK Cabinet Office, wrote here that it represents the future of public sector IT, and describes how it will enable the next phase of digital transformation for government. The Cabinet Office also published this video to easily describe the concept.

As Government Executive wrote, the concept then further broadened to other markets like the USA, with FCW asking if the federal sector is ready for it, and also Australia recently began emulating the same concepts in their own IT strategy planning.

Transformational architecture

The UK was especially lucky in having minsterial level understanding, vision and support for the concept, meaning it was accurately targeted at key goals, most notably a modular, reuse-centric approach that would yield faster delivery of digital services and large-scale cost reductions.

As Francis Maude, Minister for the Cabinet Office, describes in this article one of the biggest cost driving challenges government faces is this duplication across departments, such as the MOJ writing off a £56m project when it discovered the same system was already being developed by the same supplier with the Cabinet Office.

GaaP expands this principle to all of government IT, where new systems will be built upon a similar layer of building block components, rather than being reinvented from scratch each time.


A particularly powerful and practical example is the GOV.UK Verify ‘IDaaS’ – Identity as a Service.

Not only is this an example of a common, modular service approach but it also features the other essential ingredient of the Platform model: The digital marketplace.

By this I mean there is a mini marketplace of vendors, akin to the G-Cloud procurement framework, specializing in implementation of these Identity methods and standards, for example you can sign in via ‘Yubikey‘.

The Cabinet Office now plans to extend this approach out to a multitude of other areas, like a common payments platform, and as we’ll see as we explore other industries these components like shared Identity and a Digital Marketplace are the common design features of the Platform blueprint.

Banking as a Platform

This point is made immediately as we move into how Platform might be applied in Banking.

First of course we can conclude areas like digital payments will naturally also be important to the banking industry if not more so given it is central to their core purpose, so it will be interesting to explore just how common these payment platforms might become.

Identity is also the first technical element to consider with this perspective, when you consider you are now able to utilize your banking ID to log in to government systems, via these programs, such as Barclays who offer a service.

BaaP – Exploiting the ‘Digital Switching Economy’

As we take a broader view again and look at the general trend of ‘Banking as a Platform’, we can start to identify specific markets and disruptive models that these components might enable.

Pascal Bouvier kicks off this theme in his Linkedin blog, describing seven levels of ‘FinTech Platform‘.

With major market players like VISA embracing an open platform, through partnering with Koho, there’s do doubt it’s a trend that will lay the foundations for various intersections of disruptive possibilities.

In particular the super sweet spot is the intersection of mobile, social and Identity.

TechCrunch writes your wallet will become the next platform, and every one from Facebook to Twitter becoming a medium by where business models can exploit social relationships as a conduit for transactions.

It can also be exploited through the key principle of digital markets. TransferWise harnesses the e-marketplace approach for facilitating international transfers of monies that Airbnb and Uber Taxies use, and Paypal similarly has also moved into peer to peer payments.

Digital Switching

Accenture described this fluidity as the key ingredient of a digital ‘Switching Economy‘, the $200 billion in revenues up for grabs from disgruntled customers switching to a different bank because their demands for value like online services isn’t being met.

From this article on Digital Identity and banking, the author notes the strategic importance of this type of user-centricity:

“A study by Vanson Bourne, sponsored by CA Technologies, showed that 47% of consumers in Europe have dumped a brand’s application for another due to a better feature or service, highlighting the importance of a seamless and easy digital interaction to help build customer loyalty.”

In short the Identity and Ecosystem foundations are as common and strategic to banking as they are to governments, for the same reasons.

Digital network devicesTaaP – Digital Ecosystems, as a Service

Therefore they naturally carry over into every sector and we can identify where they impact telecomms to begin defining ‘TaaP’ – Telco as a Platform.

“How do you know when you’re a Platform Business?” is the question asked by the TMF industry forum, one of the leading industry bodies for the sector, and who themselves have been quick to understand and relate the Platform model to their members, through insightful blogs and a full transformation body of knowledge, their ‘Frameworx’ assets and open innovation ‘Catalyst’ project framework.

This is being accelerated from the ground up, through the rapidly progressing roll out of NFV-driven network transformations, a shift to a software-centric approach to telecomms services (networking routing, firewalls et al), thus merging them into an existing Enterprise Cloud environment of elastic IaaS combined with Microservices and Continuous Deployment practices, aka ‘Cloud Native’ software engineering.

Abstract vector illustration of API interface flat design concept.

API Ecosystems – Enabling the ‘digital supply chain’

Again the common blueprint of Identity and Ecosystems is present, and mapped to Telcos we can identify some key tech trends and opportunity areas.

For example as Gartner describes APIs are at the heart of the digital business model, an effect they explore for hot spot markets like digital banking, and this great Pearson case study examines them applied in the media sector. Pitney Bowes highlights the concept in simple terms like a ‘digital supply chain’, how can you reflect the downstream world that sells your products, in API enabling terms?

The TMF themselves are a pioneer in the field for their industry, developing the ‘Open API Map‘.

Key players include Vodafone, and Dr Lester Thomas their Chief Systems Architect describes the central role of APIs in developing a Telco marketplace in this form, an ‘NFVaaS Ecosystem’, an industry framework for:

  • Enable the core workflow building blocks – For example ‘NFVaaS On-Boarding APIs’ would be a central feature of enabling a marketplace that operates smoothly, able to bring on new NFV vendors via a SaaS business model rather than a ‘buy and install’ vendor relationship.

As we’ll see in the next, concluding section these programs are providing the building blocks that facilitate the Identity and Ecosystem blueprint.

Weaponize your Cloud strategy

A TaaP strategy naturally emphasizes the fact that the industry is one of technology – Ie. Not only can the model help them optimize their own internal delivery platforms but also be instrumental in facilitating new products for their customers.

Rapid and comprehensive solutions for partnering are required as Telco’s seek to expand their operations and become ‘Digital Service Providers’, and hence the earlier title of ‘Digital Marketplaces, as a Service’ – The right approach can enable the Platform to be further extended as a managed service for customers.

Where airlines or banks might repeat their own Platform model, like GaaP represents for the public sector, the critical differentiation for telcos is that these strategies can be enabled by their services. Ie. Their platform strategy should be to enable platforms for their customers.

While they will enjoy operational efficiency benefits from NFV adoption, the real thrust of the business case is the new digital services they make possible, and the new revenue markets these represent.

mk-smartMK:Smart – Blueprint for a Digital City Ecosystem

BT and the solution they delivered for Milton Keynes is the perfect example.

This provides the city an ‘innovation ecosystem’ where developers can on-board new apps they’ve developed for the city, apps that leverage a platform – APIs, Identity, Big Data services and IoT SDN are all part of the foundations they can build upon.

Every city has initiatives to repeat the same model and BT is well positioned to repeat the success across the UK. Other telcos could similarly follow their lead in their own countries.

This is because this digital ecosystem is a ‘multi-tenant’ environment, a SaaS platform for the city to host multiple apps, and BT then runs their own platform, also a multi-tenant environment, capable of hosting multiple ecosystems. They can offer ‘Milton Keynes, as a Service’ to other cities without having to deploy new technology.

This is such a powerful product platform that 451 Research describes it as ‘weaponizing’ your Cloud product strategy, in their case study report of BT, sponsored by Infonova the supplier of this platform, describing this architecture as a ‘Cloud of Clouds’ approach and capable of supporting 2,000 enterprise customers (5,000 tenants).

Neil McEvoy
About Neil McEvoy 17 Articles
Founder and CEO of the Cloud Best Practices Network.

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