“New technologies and new content are creating new markets and opportunities at a dizzying rate” says Graham Porter. But if service creation is to be successful operators must make use if their revenue intelligence. Porter offers Mobile Europe readers a guide. 

Today’s fixed and mobile telecommunications customers are increasingly sophisticated and informed about service plan and pricing alternatives. Through the introduction of new communications laws and standards, such as number portability, it has never been easier for customers to change services and service providers.

In conjunction with the rise of savvier consumers, new technologies and an increasing variety of content are being developed at a breakneck pace. Along with globalisation, these new technologies and new content are creating new markets and opportunities at a dizzying rate. In this complex environment, what differentiates market leaders from followers is the ability to respond rapidly—in hours and days, rather than weeks and months—to customers’ demanding and evolving service requirements.

In order to create and maintain competitive advantage carriers must have in-depth, knowledge about customers and partners including market segments, buying habits, trends and overall lifetime value to the business. Moreover, they must be able to accurately predict in real-time how changes in services, packages and pricing will affect customer retention and profitability. To accomplish this, service providers need a structured set of business intelligence tools focused on maximising revenue generation and profitability — they need revenue intelligence.

Maximising Customer Value

Revenue intelligence is a competitive differentiator that directly — and immediately — contributes to the bottom line. It provides the ability to better understand and manage customers and provide them the best services, increasing customer satisfaction by minimising churn of the most profitable customers.

Minimising churn of high-value customers is essential. Customer retention activities and marketing campaigns take up a large portion of service providers’ budgets. Managing effective return on this investment is crucial to business growth. Service providers must be able to identify the customers that deliver the greatest lifetime value potential and develop and roll out appropriately targeted campaigns.

Regular market analyses of the existing customer base, including what subscribers would pay for competitive offerings, can anticipate and prevent churn. Service providers must also consider what may happen when launching a tariff similar to that of a competitor but with a lower price. Unless there is an ability to accurately forecast the future margin of the tariff, the offering might turn out to be of low value or even unprofitable to the service provider. This is especially true when free-usage bundle offers come into play.

Revenue intelligence enables telecommunications service providers to focus on these business issues. It assembles existing information from various sources and produces enriched information based on simulation and data calculations. Revenue intelligence enables service providers to:

l Calculate the effect of new product pricing versus existing pricing or the competition’s pricing. This includes taking multiple bundles and convergent services into account. For example, a customer might receive a free 10MB home Internet download for each 100 pounds spent on wireless calls.

l Increase availability of information regarding business profitability or future margin opportunities of new services.

l Address market elasticity to maximise margins. For example, there may be a five percent shift in customer base to another price plan as a result of a marketing campaign. Or, the introduction of a new service may move 10 percent of calls in Zone X to this new service in Zone Z.

l Improve the capability to negotiate changes in the value chain.

The information provided through revenue intelligence can be translated into more effective service creation, bundling, pricing and marketing campaigns. The advantages of using revenue intelligence during the price planning and development stage cannot be underestimated. The example below provides a step-by-step look at how revenue intelligence can maximise profitability during price planning and launch.

Price Plan Rollout Process

Step 1: Programme Creation and Definition
Develop ideas using information about the general targeted customer segment. For example, what types of promotions might be effective? What would be effective against competitors?

Step 2: Customer Segment Identification
Use revenue intelligence to accurately identify customers most likely to accept the new plan or offer. Evaluate likely competitive offers and ensure the target corresponds with original ideas in the Creation and Definition Phase.

Step 3: Programme Plan Identification
Evaluate potential programme plans. Based on Step 2, determine which offers seem most appealing.

Step 4: Testing
Utilising the expected service usage (and/or based on real usage), calculate the cost for the subscriber of the service as well as for the service provider. Ensure profitability within the targeted customer segments.

Analyse data for customers with low or negative margin and their characteristics (especially actual call behaviour, contract and demographic data) to identify and minimise any financial risk. Utilising this information, make informed decisions regarding the assumptions, tune the service costs (by reiterating steps 2 and 3), or to accept a known risk.

Note that steps 2 through 4 remain a closed loop until consensus is achieved. Revenue intelligence reduces the time spent between steps 2 and 4 by making meaningful information and data immediately available to the decision makers. These are the most critical and time consuming phases in the rollout process. Each day spent here potentially diminishes return on investment. Data quality throughout this process is critical. If the data is poor, each approximation made working with averages or skipping steps to save time may entirely compromise the profitability of the new price plan or service.

Step 5: Launch
The launch phase includes the implementation of the new plan in the revenue management and billing system. It also optionally includes the agreement with any approved interconnect partners and the marketing campaign preparation up to the launch day.

Using revenue intelligence service providers can calculate the highest value package for the installed base and determine the optimum length of the new contract, forecast the approximate margin contribution gained from the offer and the expected break-even point per customer. In addition, it is possible to identify customers who will have the highest probability of utilising the offer—enabling informed decisions to be made that will gain the most favourable margins for the price plan. This knowledge contributes to faster pricing plan launches and/or modifications (and to the highest value customer segment), because the extensive testing phase has been bypassed. In addition, relevant data has been captured to back-up the decision.

After the Launch

As significant as the gains are during the planning and launch of services, there are also benefits to be gained in customer support. For example, when a customer calls with questions or concerns about a contract, the provider’s service representative should have relevant customer information immediately available to maximise this “moment of truth.”

Today, this typically requires tight integration to the CRM system, and data regarding average revenue, real margin contribution made throughout the relationship, and the forecasted length and value of the contract is available.

However, raw data is insufficient. Customer service representatives cannot be expected to manage customer queries while making the calculations and connections required to propose appropriate service bundles and pricing packages. Revenue intelligence converts the raw data into valuable information that equips the representative with the power to propose, according to actual customer behaviour, an appropriate price plan that is in full alignment with the provider’s business objectives — all in real-time.

Revenue intelligence also provides visibility into applying discounts (including cross-discounts), free units of all types, market elasticity, and other seasonal effects. Armed with this information, providers can offer customers the service packages that will enhance the relationship, leading to increased revenue potential from that customer.

Conclusion

Market leading telecommunications and media companies are realising the valuable information that resides in the volumes of customer data that they generate each day. By utilising revenue intelligence to understand this information, service providers can anticipate customers’ needs and gain sustainable competitive advantage. A structured revenue intelligence solution provides key insights that can be applied directly to promotions and pricing programmes that are uniquely tailored to each individual customer. This not only maximises revenue, it increases loyalty and minimises costly churn.

By utilising a 5-step programmatic approach, service providers can define new programme opportunities, identify appropriate customer segments, develop specific offerings, test the offerings and introduce the offerings to the target market.

A methodical approach to revenue intelligence helps make sense of the complexity and pace of today’s telecommunications and media marketplace, enabling service providers to provide programmes and promotions that fit their customers’ needs.

Two of the most important areas for reaching mass market acceptance for moble gaming will be brand management and pricing. Enda Carey, marketing director, iFone, gives his prescription for the way forward for the mobile gaming industry,

It is widely accepted that mobile gaming has the potential for exponential growth over the next few years. It is already one of the most important sources of data revenues and this trend is set to continue. Nonetheless, the mobile gaming industry is in danger of stagnating. While the buzz about the latest mobile games releases is still there, the number of consumers actually downloading games to play on their phones is still quite low — it is estimated that in 2005 only seven per cent of consumers with game-enabled phones have downloaded a game to play while 42% have played the pre-loaded games that come with the phone.

Why is this happening? Mobile games are the phenomenon of the moment. Supposedly everyone is playing games on their mobile devices, yet the industry is failing to reach mass market acceptance. What needs to be done to ensure that the mobile gaming industry becomes the cash cow that it should be?  The approach should be multi-faceted — both publishers and operators have a responsibility to ensure the product is perfectly pitched for their individual customers. As both operators and publishers are starting to play it safe with well-recognised brands in mobile gaming, brand management has to come to the fore as the most important aspect of creating long-term success for the industry. There are four key aspects of brand management which need to be adhered to in order to ensure long-term successs for individual titles and the industry as a whole. Let’s not underestimate the scale of the task required by the industry. There is much work ahead.

Quality

A small word, but a huge task. Ensuring high standards and good quality throughout needs to paramount, not only to keep existing users content, but also to attract new users into the market. In the short term, quallity will mean keeping users hooked by using innovative new features in the context of mobile gaming, rather than innovative new products as such. Until the industry becomes happier to take a few more risks, this will remain the case.

Promotion

t is important that brands are promoted and promoted well to consumers. Challenges remain however. Whilst different operators have diferent release dates and release policies, it remains difficult to co-ordinate pan-European campaigns. It can even be difficult to co-ordinate national campaigns on this basis.

Education

Do consumers know how to download a game? When an industry is in its early stages, the major players in the industry, which includes operators and publishers have a responsibility to educate the buying public as to how it all works. This does not all have to be mass-scale marketing (though of course that would help), but creativity is needed to keep pushing the ‘how-to’ of downloading a game until it becomes a mass-market phenomenon where few people can complain that they have no idea how it works. For instance, operators and publishers could look to trial versions of a game, demonstrating how it works, but constantly keeping an eye on the quality, ensuring that the consumer will come back for more.

Pricing

There is room too, to look at the impact that pricing has on consumers. Could the industry get a little more creative in its pricing models for consumers? Is there potential for a mid-range market? Is there potential for a budget range? Or how about a subscription model? What would be the impact of a prepaid gaming download card?

One strong example of this could be episodic gaming — consumers will buy a number of levels at a time. An excellent potential example of this is Lemmings — a game that would be perfect to buy five levels at a time for a couple of pounds. The operator could then just carry on supplying level bundles until the users decide to stop. The point here is that the price point is low enough for an impulse buy, the brand is premium and has already been proved popular with the consumer, while the operators have a path forward for continued upward selling.

But of course, all of this ties into the big picture of brand management, managing brands in the right way to ensure longevity of titles.

Brand Management

With so many big brand games being released, operators need to feel comfortable that the publishers are the brand ambassadors and the experts, not just for a single game, but for the whole IP. Mobile operators simply do not have the time or energy to deal with one set of people for the game and another set entirely for the look and feel of the brand, brand history, brand guidelines etc.

The major mobile games publishers are becoming the brand managers of the mobile entertainment medium. And now that operators are choosing the games publishers they want to deal with long-term, sacrificing brand quality for quantity is a dangerous game to play. Consumers can, and will, switch off from mobile gaming if they feel that they are just being fed what they would consider to be rubbish. The only winners in this market will be those that can provide the expertise of bringing serious brands to market, brands that will appeal to consumers. 

This trend will only grow stronger over time. Now that more and more IP holders are moving towards mobile entertainment and as more and more serious brands from movies or hit TV shows come to the small screen, the value of IP holders’ brands will start to dominate. If we consider brand to be important right now, before too long it will become everything. 

From this position of brand ambassadors or brand managers, major publishers now have firm responsibilities to the operators, the IP licensors and the consumers. To the operators, mobile games publishers need to be the trusted experts and need to live and breathe the brand. To the IP licensors, the publisher needs to be bold yet realistic in its recommendations as to how they move their brand forward on the small screen. The publisher also has a responsibility to the IP holder to create the best possible outlet or outlets for their IP.

And to the consumers? The publisher has a duty to provide the best possible gaming experience, one that will mirror the experience the consumer has previously had with this brand, whether it’s a Hollywood blockbuster film or one of the casual gaming brands of yesteryear. 
 At the point of taking on a brand, a large number of questions need to be answered: which territories would the brand appeal to? What local translations are required? Which demographics would it appeal to? Young? Old? Casual gamer? Serious gamer? How long could the brand stay fresh and exciting to operators and the consumer?

In particular, when a brand comes via another console, it is vital to retain the look and feel of the brand whilst needing to manipulate the form factor heavily. To a degree, on other consoles, publishers can afford to get it a little wrong. On the mobile phone screen there is no such luxury.  Take Monopoly for instance, a game that is known to millions of people across the planet. To give the same look and feel of the original game to an audience of millions is no small thing, especially when you consider that every one of the millions that already know Monopoly could be a potential critic of the mobile version. To then extend the brand beyond its original boundaries through new iterations of the same brand and still gain consumer support is something beyond.

Extending the lifetime of a brand past a single implementation represents a major win for the operator and the consumer. The operator wins by being able to extend the revenue opportunity by giving its consumer something new yet familiar. The consumer gets extra value too. When a brand is well-loved by a consumer, further versions or new takes on the brand represent a bonus and not a cost.

The games publishers themselves need to keep their eye on the long-term payback. A long term investment in a major brand is just that, long-term. The payback may not come in the first outing of the brand on the small screen.

But presuming a brand plan based on solid experience is in place, the publisher can be confident when the payback will be reached and exceeded to the benefit of operators, consumers, IP holders and the publisher themselves.

Mobile Europe asked Alon Barnea,  VP of Marketing and Business Development at value added roaming service provider Starhome to list some of the key services available to operators, an to assess their impact on the bottom line.

Recent research from the Informa analyst group on Global Mobile Roaming estimates that the number of international roamers will more than quadruple between 2004 and 2010, growing from 210,000,000 to 850,000,000. The research predicts that these new roamers will predominantly be occasional business travellers or holidaymakers, many of whom are not very familiar with international dialling conventions. 
The following advanced roaming solutions are already available to enhance operators’ control of roaming, improve the travellers roaming experience and open up new opportunities for cooperation between roaming partners. 

Steering of roaming

This service provides mobile operators with powerful remote control over the VPMN (Visited Public Mobile Network) selection process when their subscribers roam in foreign countries. It allows the operator to steer outbound roaming subscribers to preferred VPMN networks according to their priorities and criteria. For example if the customer has a 3G mobile phone the operator could steer that user to the network that provides 3G services in the visited foreign country.

Call Assistance

Call assistance service corrects common dialling errors that roamers make due to unfamiliarity with international dialling. Roamers make frequent dialling errors when placing international calls, due to unfamiliar dialling conventions and language barriers. Statistics from live networks show that up to 60% of these calls are never completed with the result being lost operator revenue and fewer completed calls. Features of this service include seamless call completion, and/or intelligent SMS to educate users. A recent report by Starhome suggests that in 2004 the mobile industry losses due to roamers dialling mistakes exceeded $525 million. An Asian operator that has implemented Intelligent Call Assistant saw its monthly incremental revenue increase by $2 million in 2004.

Home short code

This solution allows travellers to continue using their familiar short codes for home based VAS (Value Added Services) while roaming (for example voicemail, customer care, directory assistance, ect). Using Home Short Code operators provide visiting roamers seamless access to VAS. Features enable seamless VAS access and MNP support for outbound as well as inbound roamers. Statistics from Starhome show that only nine to 12% of roamers are currently using short codes, and operators are losing at least 0.2 euros per roamer per day.

Optimal Routing

Roaming calls may sometime be expensive, due to routing inefficiencies involving an international leg to/from the HPMN (Home Public Mobile Network). Optimal Routing is a simple cost effective solution that enables the visited network to route calls directly.  By eliminating international tromboning and HPMN handling, international call handling costs to the VPMN are reduced. Operators can offer flexible tariffs to the caller/called parties and create strong incentives for use.

Optimal Voicemail Deposit

When roamers don’t answer calls from their HPMN, the visited network default routes the calls back to the home voicemail system. This inefficient international tromboning results in higher call costs and increases the likelihood that the subscriber will disable voicemail forwarding. Optimal Voicemail Deposit overcomes problems caused by incomplete signalling. Roamers get better control over their incoming calls and reduced costs for voicemail deposits and late call forwarding to other numbers. 
Direct Late Call Forwarding capability lets roamers determine where to forward calls when the handset is busy, or the calls are not answered. Calls are routed directly from the home network to the forwarded number, thereby, eliminating international legs.

Local Roaming Number

Mobile roamers often turn their handsets off, reject incoming calls or purchase local prepaid SIM cards to reduce their roaming expenses. Local Roaming Number service provides roamers with all the benefits of a local number, eliminating the need for them to acquire a foreign SIM card.  This feature enables the roamer  to present a ‘local presence’ while roaming.

HPMNs can pre-assign their outbound roamers with a local MSISDN (Mobile Station Integrated Services Digital Network) before their trip. The new local numbers can be used for receiving calls immediately. Calls can be generated using both the original number and the new local number, thus benefiting from reduced tariffs for mobile generated calls.

Roaming Portals

Roaming portals allow operators to better serve their important roamer segments by enhancing their roaming experience. Roaming portals provide services and the top ranked telephony voice and data services via a unified, single user interface. These services include comprehensive data and voice services, tailored promotions, city guides and weather.

Promotion Suite

This allows operators to send spam-free promotional messages to inbound and outbound roamers to increase use of roaming services. There are three main features — welcome & outbound SMS, Winback SMS and Call4Action.

A Welcome Back feature extends a welcome home message to outbound subscribers as they return home, the content of which can be tailored to specific roaming communities.

Winback SMS lets operators bring back visitors that left to a competitor’s network. The Winback SMS detects visitors that left the network and then sends a call-to-action SMS promotion, such as special dialling tariffs (in the user’s native language).

Call4Action prompts “sleeping” subscribers to act. Up to 50% of outbound roamers do not generate traffic when abroad, due to perceived high tariffs or unfamiliar international dialing. By tracking this inactivity, Call4Action can flag these subscribers and encourage them to make calls by sending a special message such as discount offers, dialing tips, tariffs or any other promotional message.

High roaming revenues and profitability may come under threat — so what can operators do to fight back? Here and over the page Mobile Europe examines the threat and opportunities.

Roaming services have come on a bundle since the early days of receiving a text welcoming you to a host operator when you touched down at the airport. Now, operators are realising the vast sums to be made by keeping their users on the preferred network when they are abroad, pushing through all the services users are used to at home, and also by offering similar services to inbound roamers.

The big known fact about roaming is that it is incredibly profitable for operators. The second is that that situation cannot last. First, a big threat will come from regulation. In December 2004 the European Regulators Group (ERG) launched an initiative looking into the wholesale prices of international roaming. This included the National Regulatory Authorities (NRAs) in the EU Member States sending questionnaires on international roaming to the mobile network operators in their respective jurisdictions.As part of this initiative the NRAs decided to intensify their efforts to find a harmonised approach to regulation of mobile international roaming services and have adopted a ‘common position’ on the matter which will be published for consultation. The ERG notes the following findings on international roaming following the joint work of the NRAs to date, some of which will give everyone involved in roaming pause for concern:
l Retail charges are currently very high without clear justification
l  This appears to result both from high wholesale charges levied by the foreign host network operator and also, in many cases, from high retail mark-ups charged by the customer’s own network operator
l  Reductions in wholesale charges are often not passed through to the retails customer
l  Consumers often lack clear information on the charges for roaming
l  There are strong linkages between the markets in the different member states

This list of concerns appears to have been listened to by the operators, which are beginning to respond with clearer information on roaming prices. Vodafone, for example, recently (July 2005) launched its Vodafone Passport service, which it modestly described as a revolutionary new way to pay for calls abroad.

Vodafone Passport customers will pay a one-off connection fee of 75p for each call they make. After that, they will pay the same rates as they would at home – if they have inclusive or voice pack minutes, the call could cost nothing more. For example, someone on an Anytime 200 price plan, could call home from Rome and chat for 30 minutes paying just 75p using their bundled minutes.

Tim Yates, chief marketing officer of Vodafone UK explained: “Customers told us they were nervous about using their mobile abroad because they were worried about the costs. Vodafone Passport does several things: it gives customers a clear idea of what their calls are going to cost and it also gives them much better value when calling from abroad. Now customers won’t have to seek out alternative options to keep in touch..”

That last point, “alternative options” may be more of a pointer to Vodafone’s motivation than regulatory pressure. One option is simply not to use a mobile, another is to buy a different SIM purely for travel. Textbay is one company that is offering pay-as-you-go SIMs for unlocked phones. Incoming calls are free. Outgoing calls are still expensive but cheaper than a normal contract roaming tarrif.

Textbay Managing Director Alain Bywaters, says, “Phone companies do not need to charge so much for these calls. They make enough from us throughout the rest of the year and as soon as we go on holiday they get a heavy cash bonus. One day this will all have to change but until this happens Textbay is offering a genuine alternative to over 60 worldwide destinations.” One way “all this may have to change” would be the growing threat of VoIP. Granted, it seems an unlikely replacement for the kind of worried holiday maker market Bywaters is after, but in the business and frequent traveller sector, this is a real coming threat to mobile operators.

Bobby Srinivasan is chief operating officer of Roamware, one of the dominant providers of value added roaming services to operators. He points out that you can already see Starbucks customers using a Skype client over the WLAN to bypass the mobile network. Of course, this model is limited by WLAN coverage and a user having the time and location to whip out a laptop, or something else that can support a VoIP client and WLAN access. But for how long will that be limited to a laptop?

As is the way in the mobile industry, Srinivisan says operators need to see such developments as an opportunity.

“Voice over IP is going to the biggest threat or enemy, but it is much better they embrace it fully. Operators need to look at how they can integrate VoIP and GSM to provide one experience, leveraging the power of IP to their advantage. Operators could look at Skype and say, ‘OK, we’ll let you Skype incoming calls as well as outbound.’ This is exactly the kind of solution we’re working on right now.”

Srinivisan says that although revenues may be forced down by regulation or competition, it is therefore imperative that operators come up with smarter roaming solutions that drive revenues in other ways.

“I think in a developed market like Europe I don’t see revenues remaining as they are now. Regulators will force reductions in revenues and the only way to combat that is to keep rolling out value added services to retain revenue levels. Then there is the whole area of data roaming, and what operators can provide in that area.”

Data roaming value added services is the next level for operators, allowing users to take their favourite content services with them when they travel, in a manner they are used to. Onwards then, to the next roaming frontier.

In the first of a two part extract from the book Connected Workforce, Andy Mulholland, Global Chief Technology Officer, Capgemini and Mal Postings, Global Lead for Mobility and RFID Solutions, Capgemini reveal the ideas and attitudes needed to navigate a rapidly changing business environment. They look at the problems faced by companies that are restrained by linear processes and argue that mobility must bring business and technology together in a collaborative approach. Building on examples from a wide range of industries, they show how, at this evolutionary phase of new-technology adoption, niche operations can have a stranglehold in key areas. They make a compelling case for embedding knowledge within the business process.

There is a clear increase in the number of companies that are looking for an enterprise-wide mobility solution. Perhaps as recently as 18 months ago, mobility wasn’t even on most companies’ radar. Now, the CIO is being handed reports of an isolated pilot here, another there, 300 users in this territory, 50 in that one, some using technology X, others Y. These projects have mostly been carried out autonomously, with minimal if any change to the core IT infrastructure. The impact of these pilots is now becoming clear and the CIO is starting to have visions of improved benefits, return on investment, productivity gains and increased customer satisfaction.

The mobility market is heating up rapidly. Companies are projected to spend €50 billion over the next three years on mobility solutions with an annual compound growth rate of over 44 per cent (IDC, 2002). Ninety-two per cent of companies are kick-starting initiatives. Ninety-seven per cent are increasing their spend, and of those, 60 per cent are spending over €500k on a typical project. Mobility is clearly on the move.

So how do you plot a course through this rapidly changing environment? The problem we find is that too many companies are restrained in their thinking. Everybody’s still talking about linear processes: business-to-business, business-to-consumer, business-to-employee and so on. There is also no substantial new thinking within the typical MBA management models and methodologies like Michael Porter’s value chain, C.K. Prahalad’s ‘core competencies’ and the Balanced Scorecard which are almost 20 years old now. We need a more business and technology joined-up way of viewing the world. For mobility we have developed the ‘Mobility Service Grid’ that has at its core four different architectural dimensions: Enterprise, Marketplace, Device and User.

The Enterprise could be AXA, British Airways or your company of choice. The Marketplace is like the Yellow Pages, a host of organisations with service level agreements, pricing structures and so on.

More imagination

You need a bit more imagination when you get to the Device, because we’re not simply talking about mobile phones or laptops. It could be a car, a network-aware apartment, a fridge or any kind of device, running any kind of operating system, whether it is a Java Virtual Machine (JVM) or a Windows CE-style operating system.

And of course, you have the User. It may not seem intuitive that the user and the device are separate, but they are and this is fundamental to achieving the full potential of mobility. For example, say that Shell offers me a 10 per cent discount on fuel for the next two months. The car doesn’t come into it.

The offer is made to me, so this is definitely an enterprise-to-user communication/promotion. Under different circumstances, that offer could be made on an enterprise-to-device basis. If I’m on the road and my vehicle telematics signal that I’m running near empty, the car can broadcast that requirement to the marketplace, giving its current location and stating, in effect, that it’s now in the market for fuel and asking which enterprise (fuel station) can make the best offer. It doesn’t matter who is driving the car, it’s the car that’s actually communicating.

The Mobility Service Grid model is not just about semantics. It’s a practical tool. It gives you a workable number of relationships — about ten in fact — which can not only be used as an analytical approach but can also lead to the suggestion of entirely new services. In practice, we tend to map out our client’s requirements in true business consultancy fashion first — business process, business service and so on, identifying the various processes involved in each area — representing an ‘as-is’ position.

Then we take a step back and use this methodology as a basis for further enquiry: what do you need to do as an enterprise? What could or should be done by the marketplace? What could be done by the user? What can be done by the device? You soon find yourself putting the project into context, considering a number of options that you can evaluate in different ways, ie is this process really a differentiator? Is it going to earn any money in the future? Etc.

This is much more aligned to a service architecture way of viewing the business — and again will help in defining the bridge between the business processes (service) and relating technology needed to satisfy these services.   

But often companies do not start adopting mobile technologies because they are visionaries or because they can see long-term potential. They’re usually more driven to do so by some basic and easily identifiable requirement: employee productivity in a particular department, for example, or a reduction in back-office admin.

Driving mobility

Competitive advantage is beginning to drive mobility, but for many the basic requirements are still in the driving seat. Maximising the return on assets is another frequent example, but most of the time it’s a simple people-focused issue. If mobility gives a travelling salesman more time to do his job while he’s on the road, then all of a sudden he doesn’t have to spend from 4.30 in the afternoon until seven in the evening doing paperwork.

Another frequent example involves compliance. Make the salesman more efficient and you can drive up sales, but foul up your compliance and you can lose your business. The problem is exacerbated because a lot of compliance is currently heavily paper-driven. To take Shell again as an example, in the Netherlands they simply cannot implement all the compliance measures using a normal paper-based admin system. We developed something very simple using an online database on a PDA that presents a workflow for compliance, enabling employees to go on their rounds and use a check-list. Compliance sorted out and cost savings into the bargain.

Unfortunately, despite the obvious possibilities, the adoption of mobility has faced a number of major challenges. The first inhibitor has been the global economic downturn, putting pressure on discretionary IT spending. One of the results of this has been an increase in the importance of outsourcing. A lot of companies are saying that having gone through the Internet revolution and suffered a great deal of heartache by re-inventing the wheel internally, it’s easier to outsource from the start. Especially now that desktop outsourcing and managed service provision is seen as normal — the extension in this service to cover enterprise mobility devices is a natural one. The issues for procurement, provisioning, support, maintenance and end-of-life are all costly and time-consuming and are not ‘core’ for many companies.

Next, you have cultural issues. Some employees may feel that they are being watched too much and no longer enjoy the freedom they had to organise their daily work routine. And others may feel compelled to now be available 24/7, actually reducing the amount of free time although the mobility solutions they enjoy should in principle have the exact opposite effect. Many organisations feel that these cultural issues are a significant inhibitor to mobility.

From an IT point of view, there are also significant technological barriers. First, of course, you have network performance, but this is being addressed steadily by the prospects of 3G. More seriously, many mobile solutions involve unfamiliar technologies: a new operating system, hardware platforms, or more esoteric issues such as the agent-based applications that come into their own when you have device-to-device communication.

The result is that a lot of CIOs and CTOs we speak to see the area as still emerging and not yet mature. They are expecting to find a robust mobility solution from the large, reliable players — but they often can’t, because these are still mainly in development. This in turn leads to another problem: the solutions that are out there tend to come from small players. We’re in that evolutionary phase of new technologies where niche operations have a stranglehold in certain key areas. Clients are impressed by — and desperate for — the solutions, but are still nervous about issues on scalability from the niche providers in the market today. This phase probably won’t last long: we expect to see more consolidation within this market. In the meantime, there’s an interesting market dynamic.

If you’re courageous, there are some smart deals to be done in this environment. From a Capgemini point of view, it’s a full circle: at one end, we’re dealing directly with 500 clients globally; at the other, we have small ISVs coming to us for a mantle of respectability and scalability, with technologies that attract a great deal of attention from the larger clients. And in the middle, we also have partnerships with the Telco Service Providers — who are providing voice but need to partner on mobile enterprise, and with the OEMs who want to sell more handsets but need m-commerce solutions to attract the clients… which takes you back to the beginning of the circle. The small ISVs are hot: their concepts and technologies are a driving force, but they’re not big enough to provide the fully managed service that key clients require. So here Capgemini looks at providing a collaborative approach with an ecosystem of partners to guarantee a best of breed service.

These managed services are essential because of the need for security, which is becoming more significant – especially where device-to-device communication is concerned — and compliance. Wrap these issues up with the challenges outlined above and you have a strong need for a service that goes from procurement and provisioning, through call centre support and maintenance, to end-of-life management.

or example, a number of companies, Capgemini included, have set up managed service offerings based on a cost per user. A client wants 5,000 devices? We might quote, say, €70 per user per month, to include cradle-to-grave management of the device and user support. This further helps by shifting the whole exercise over to an opex model, reducing the high capex costs that would otherwise be involved in operational development and support.

So, what are the real benefits you get from mobility? Find out in the second extract which will appear in the next issue of Mobile Europe.

With wireless and broadband hastening the demise of fixed voice, Priscilla Awde checks out the competing technologies that could take business voice wireless.

As corporate workforces become more mobile, wireless voice communications are the norm and necessary in a world used to ‘anywhere, anytime’ connectivity. Given the proliferation of devices, technologies and architectures, selecting a suitable, cost effective, wireless voice service and integrating it into corporate communications policies is not a simple matter.

IT managers and CIOs no longer want the expense of separate voice/data, fixed/mobile networks or high charges. They want to support mobile workers but with business class solutions governed by service level agreements. Needing to control mobile handset usage, authenticate users and bring wireless voice services under one, overarching corporate communication policy, they want similar assurance levels, PBX functionality, packages and tariff discounts as are available on traditional fixed systems.

Nails in the coffin

As mobility and broadband products put the final nails into the coffin of fixed voice — now a commodity service, bundled into broadband packages and sent over IP networks — fixed line operators are capitalising on existing relationships with enterprise customers and developing high quality wireless voice services. Most are building next generation, IP networks which support converged services.

Mobile operators have concentrated mainly on consumers rather than the business sector but as markets become saturated and growth slows, they too are designing packages for the growing and lucrative enterprise sector.

According to Ovum, Western European enterprise wireless voice connections will increase from 18.7 million this year to 19.8 million in 2009 but revenues will decline from $16.9 to $15.2 billion due to smarter buying decisions, price competition and bundled packages. Despite their interest in mobile voice, businesses are suspicious and consider wireless offerings weak and lacking the maturity of fixed solutions: a fact some in the industry admit.

Whilst fully committed to the enterprise sector, Stephen Noakes, director of business propositions at Vodafone, recognises that mobile operators have not dealt well with the requirements for business voice — a situation the company has solved within its own organisation by replacing the fixed voice lines at its headquarters with wireless. Fixed/mobile substitution replicates many existing PBX functions and tariffs and offers free internal mobile calls.

“There are three potential solutions for business customers: fixed/mobile substitution; fixed/mobile integration or FMC or voice over WLAN – all will be available over the next two-three years,” says Noakes. “VOIP or voice over WLAN can potentially deliver the key business requirements of security, stability and capacity but it is not clear it’s the right answer for all customers. FMC is a potential solution but customers are concerned about VOIP which is commercialised first as a consumer service.

“Businesses are looking to reduce supply base complexity and the proliferation of communications providers. There is a clear desire to reduce the total cost of ownership and they want service assurance and high quality of service — none talk to a particular technology.”

While fixed/wireless substitution provides the required flexibility, it also brings its problems. There may be poor in-building GSM cover, it can be expensive — especially for roaming or international calls — and handsets must be brought within a company’s secure usage policy. Operators may add pico cells or cheaper repeater cells to boost in-building connectivity where traffic volumes are high or to add capacity in campus environments.

Using GSM organisations can transfer calls between fixed and mobile devices and monitor mobile calls as users dial into the VPN (Virtual Private Network), from outside offices. Inside, the system diverts calls between desktop and mobile devices seamlessly so mobiles act like PBX extensions working in similar ways to desktop phones. It is possible to hand off GSM calls to the fixed infrastructure via a WiFi network.

Yet Carolyn Nguyen, Avaya’s director of global mobility strategy warns: “GSM is a separate infrastructure to the enterprise communications network and managers cannot control costs. Mobile costs are not charged in IT but via expense accounts which results in a lack of transparency. No mobile calls can be recorded, call data records, enterprise directories and voice mail are separate. The question is how to bring mobile communications into the infrastructure and integrate it into business operations and the enterprise PBX.”

Companies may choose to by-pass the fixed PBX and transmit voice, video and data over one IP network. WLANs (Wireless Local Area Networks), can be reconfigured to handle voice or companies can use VOIP (Voice over IP), which is becoming more reliable and sophisticated. Margaret Hopkins, associate at Analysys believes putting voice on the WLAN is expensive and not a priority. “There is a big cost of migrating voice to IP. Is it more efficient to put in a GSM pico cell or WLAN hub with voice support? This is a debate between equipment vendors and mobile operators. Yet, if companies are adding WLANs for data they might add voice.”

Dual mode WLAN phones are available in Japan and most manufacturers have plans to develop them but they are costly and battery life is shorter — so not conducive to corporate usage.

Emerging fixed/mobile convergence (FMC), carries integration to the device level. Using only one phone and one number, calls are seamlessly switched between fixed and GSM networks. BT Fusion, one of the first FMC services, is targeted first at consumers and SOHOs but with a corporate offering due for launch in the second half of 2006. It transmits calls over the fixed network in buildings handing off to Vodafone’s network outside. Currently Bluetooth connects handsets to the hub but dual mode WiFi handsets are expected next year once power consumption and therefore battery life improves. Connected to the broadband DSL line, the hub serves as a WiFi router supporting wireless connections for PCs, laptops and home entertainment consoles.

Underlying protocol

The underlying signalling protocol is the UMA (Unlicensed Mobile Access) standard used by mobile operators to hand off calls between GSM and fixed networks. Since it is a simple software load onto handsets, costs are kept low but functionality is limited to that available over GSM.

Looking to the corporate sector, BT has future proofed its hub by including SIP (Session Initiation Protocol), the standard widely used within the enterprise IT world to allow access to different applications from fixed or wireless devices. “With a future proof box, we only need to get it into the house once making this a very economical model,” explains Ryan Jarvis, chief of convergence products at BT. “Business tariffs will be available in the autumn and there is a large amount of interest from that community.”

Emerging as the winner

There is a debate about whether UMA or SIP will emerge as the winner. Mobile operators see UMA as a way of getting into enterprises to capture more mobile voice and eventually data revenues. Both standards run in parallel but as wireless and wireline operators invest in intelligent IMS (IP Multimedia Subsystems), next generation networks (NGNs), and use MPLS to prioritise and route voice traffic, most agree that eventually all applications including voice will be handled in the SIP world

The rationale behind building NGNs is to gain the operational efficiency and savings of collapsing multiple legacy networks into one. VOIP is a reality in core IP networks so it makes sense to extend it to the edge. “NGNs will have the central intelligence to enable seamless convergence so one identification will be spread across cellular and fixed networks,” says Jarvis of BT. “SIP is very powerful for businesses since it allows them to make free calls by switching traffic between GSM and the LAN.”

Daniel Blais, director of converged multimedia services at Nortel agrees, suggesting there are two major advantages to SIP: “It integrates different applications in one tool, has one interface and users have a single SIP identification. Applications hosted in the enterprise or carrier network are accessed via multiple devices. Fixed operators are moving to SIP because they need to add mobility and it will be the new platform for mobile operators.”

Enterprises deploying SIP throughout their organisations are linking data and voice networks via IP PBXs. “Big companies have a SIP based PBX linked to the PSTN and operators can provide a virtual mobile network onto the IP switch so users can communicate anywhere,” explains Roland Thies, VP, partnership at Alcatel. “VOIP is a SIP based technology whilst UMA is used to transparently handoff calls from GSM to in-building WiFi access points.”

Believing SIP will win in the long term because it has more reasons for existing, Jonathan Hindle, mobile service provider marketing manager at Cisco says: “It extends lots of data and voice services into an easier to deploy environment. More application writers will be writing for SIP. Whole new IP MPLS networks are being built anyway — it is easier to add SIP as part of the network migration to IP.”

Business class FMC solutions are delayed because operators want to trial them first in the consumer sector to ensure they work effectively and handsets are not yet able to support WiFi or WLAN. In Europe, mobile operators control handset development and it is not in their interests to encourage manufacturers to develop FMC terminals. However, with no such ties, Asian manufacturers are aggressively developing devices forcing Europeans to follow suit.

Eric Chambriard, VP for product marketing at Neuf Telecom believes that for the first time in telecoms history, French consumers have better services at home than at work. “There are complex and expensive office systems and cheap simple systems at home — a situation which is not good and will not last long because of convergence. We have combined voice, internet access, VPNs and mobility into Neuf Office and have an agreement with SFR (France’s second largest mobile operator), to use their network.”

Neuf uses local loop unbundling to connect its box to the copper pair so offering the service guarantees associated with the fixed infrastructure. Chambriard suggests customers are not buying FMC but a service: “In the past, we had different networks for different terminals — mobile, data and fixed networks — now all are rolled into one IP network.”

The next several years will see wireless enterprise voice systems maturing and prices dropping as operators respond to demand for business class integrated wireless voice and data solutions and IT managers get better at negotiating packages. However, choosing the right system largely depends on business needs. Katja Rudd, research director at Gartner suggests there will be an evolutionary path and mix/match approach. “The importance is to match communications to meet different functions and needs. The right question is to ask what features are required to do the job and to source economically.”

With the release of a Workgroup edition of its Sproqit direct access mobile solution, Sproqit Technologies believes it is now well placed to help businesses and operators crack the mobile enterprise applications market wide open with its thin client architecture.
Peter Mansour, CEO, tells Keith Dyer how enterprises can “Sproqitise” their applications to give them safe and secure access to applications behind the firewall from any remote device.

Mobile Europe:
Peter, perhaps you could tell us what Sproqit does and what it has developed?

Peter Mansour:
Sproqit has built an underlying architecture which allows its users to deploy any application on any device, from a set top box to smartphone or a PDA. We are now selling that and have a support for Outlook now, with Lotus and other applications to come in the fall. We will also have a Software Development Kit (SDK) which will allow users to Sproqitise their other applications, with a whole range of plug-ins.

ME:
Your system is based on a thin client architecture, which sets up a direct connection between a device and the actual desktop application. What are the benefits of such an approach compared to other methods of mobilising enterprise applications?

PM:
The chief difference is that our system was created to be a direct connection. Most of the current architectures for the wireless industry are store and forward. For example, with Blackberry all messages are sent to their massive data center in Canada and then back to the device. That makes it very expensive to run. Sproqit Workgroup Edition has no per user monthly fee because we do not need to support that kind of overhead. Also, if an enterprise doesn’t need another data plan, you can use Sproqit on your existing wireless data plan with your provider.

The second thing is security. Companies don’t want to send application information and data from behind their firewall to a data center in a different country.

The third thing is that adding applications is easy. When the SDK becomes available, it will allow developers to work in the Win32 environment, which they know well. They can write a thin translation layer for their existing application or database that provides the client data for display when requested. This layer can be integrated in the application code, or it could be a separate piece that utilises the application. Either way, the rest of the job—navigating the firewall, connecting to the client, intelligently streaming the data, caching data and processing user interactions while offline—is handled by the Sproqit platform.

ME:
There may be some security qualms over maintaining direct access to a back office connection over a Wireless LAN or wide area cellular connection.

PM:
Anything that’s in an email is going over a network. However there are two kinds of encryption. In the first, for example, a Blackberry encrypts the message itself on behalf of the user. That message is then sent to a data center outside of the corporate firewall. The second is the VPN model, used by Sproqit, with a 128kbit encrypted link from one end to the other, and in that way the message is not left “out there”.

ME:
You also sell your product independently of the wireless operators. Indeed, you make a virtue of that independence

PM:
RIM were a pager company, don’t forget, and that store-forward method is the way that paging works. All the other wireless email providers have to some extent copied the same solution, which means they are very linked to the carriers.

This makes it difficult for an enterprise to switch provider. We have a very enterprise centric approach. We have just announced a deal with Ingram Micro Europe to coincide with the launch of our Workgroup Edition, and will sign up with other systems integrators and distributors.

That creates value at the enterprise level because their users can get to their folders and messages easily and it requires very little cost to do it.

In fact we are finding that carriers are coming and talking to us, even though we are not taking a very proactive approach to that. But there are a few carriers offering Sproqit, and we don’t mean to be a threat, and in fact will be announcing other deals in the next year. But the thing I disagree with is building an artificial wall. I believe in value and if you offer that, operators will see their data usage go up.

We see ourselves operating a model, working with resellers that have a deeper empathy with the enterprise, in the way that a Siebel, or an Oracle or Microsoft does.

Sproqit really wants to be a software company and not a services company. You can install the software and run it on your network giving the IT department a higher level of confidence in terms of control and security. That will be especially important as other technologies offer more choices of connectivity

ME:
Even so, to take that model to success you need to overcome the perception that for a mobile product a company would be better off speaking to its mobile provider.

PM:
But it’s not as if the company is getting a worse product. They are getting a far better product. The only thing that comes close is Good Technology, but they also fall short. When it comes to adding applications nobody even comes close, because we have built our system from the ground up.

ME:
Of most interest to enterprises will be your release of the Workgroup Edition. What does this particular product bring to the market and for which sectors of the market do you think it will be best suited?

PM:
The solution can support up to 50 people per box, so it will be ideally suited for small businesses or for workgroups within larger businesses. It can be set up and installed quickly. The administrator sets up the accounts, the end user fills in their Windows logon and password and they’re good to go. Other solutions usually require dedicated IT staff to administer and maintain, but smaller organizations typically don’t have those resources on staff.

To get the client on the device you can put it on the network and send an email which the user can click on and install on his client in its cradle or other connection. The Sproqit client is about 300-600 KB, so you can even put it on an SD card and stick it in that way, or I’ve even beamed it to people before.

The cost of the solution will be about US$999 per server, which includes five licenses. Then you can buy one license for $149 or 10 for $999

ME:
So far the mobile enterprise has chiefly been about mobile email, but you say this thin client model is ideally suited to opening up a host of other applications.

PM:
Once you have the ability to manage files remotely through the firewall then you can talk about CRM and Siebel, to Oracle and SQL applications, as well as the more consumer type applications. I also think there is the ability to do some multimedia work, managing music and video files at the more consumer level.

In terms of handset manufacturers and other device developers, you’re going to see Sproqit in a whole slew of devices next year. It’s going to be an ingredient OEM’d in a lot of devices and other software vendors’ mobilisation products, even though it won’t say Sproqit on it, that’s what will be on the inside.

ME:
And you have a patent pending, which should give you some protection going forward.

PM:
We filed our first patent in 2000, and are in the final stages there. We think we have a different architecture which we are just launching now and seeing critical acclaim for. As people try to emulate that, patents will become more and more important.

ME:
Finally, it’s a crowded market, could you sum up why you think the Sproqit vision could win out?

PM:
As we have already discussed, we deliver a lower total cost of ownership over the alternatives available to our target market. Our architecture addresses our market’s security concerns as well, and provides them with the flexibility to rapidly deploy those applications that are most important to them.

How it works: The Four Components of Sproqit

There are four components to the Sproqit solutions:

Sproqit Companion
A thin client that resides on your wireless device. Using native controls, it gives you the feeling of using a locally embedded application.

Sproqit Agent
The agent resides on the desktop or server behind a firewall. The agent allows the user to access and control data and information on their desktop or server.

Sproqit Server
The Sproqit Server accommodates both static and dynamic IP environments, and authenticates transactions between the wireless device and the corporate network.

Sproqit Plug-ins
A thin layer between the native applications and the Sproqit products that allows the user to experience the application as though they were sitting at their desk.

The Allot MobileTrends Report is said to demonstrate that mobile devices did not replace big screen televisions during the World Cup, but rather created a new category where the two operated alongside each other.  Mobile devices played a central role in enhancing the viewer’s World Cup experience by offering them additional football and match-related information in real time, and by providing the ability to watch replays at leisure and distribute them virally.

According to the Allot MobileTrends World Cup Report:

• Lunchtime matches showed the largest bandwidth increase with 31%
• Video streaming and P2P increased moderately by 11% and 13% respectively
• Mobile data bandwidth usage experienced a 16% overall increase during post-match mornings

“The World Cup highlights the integral role that mobile devices and mobile broadband have come to play in our busy lives and how consumers use them to enhance their lifestyles by accessing information anytime, anywhere,” said Rami Hadar, President and CEO of Allot Communications. “This global tournament has demonstrated the continued rise of mobile data usage, in particular web and video traffic.”

The Allot MobileTrends World Cup Report data is based on statistics collected from mobile networks around the world representing more than 90 million subscribers.  Data was collected during the 2010 FIFA World Cup for 42 individual matches using the long term reporting capabilities of the Allot NetXplorer, Allot’s centralized management and reporting system.  The data collected for this report was totally subscriber-anonymous.