Hosted Services: A sensible investment during market turbulence?

Although Spring is on its way here in the Northern Hemisphere (yes, even this close to the Arctic Circle), green shoots sprouting in the global economy seem to be few and far between. Instead of searching for these, perhaps our thoughts should turn to lessons we have learnt from the recent turmoil and things we can do now to improve the situation without waiting for these elusive shoots to take hold.

The first lesson is that operators still have an appetite for launching new services. Far from it, as anyone who attended the recent Mobile World Congress will have observed. As a provider of software applications for operators, this is obviously good news: innovation and evolution are not dead. But, there is a more cautious approach to any project which requires investment. A corollary of this is that the customers of operators are equally cautious about investing in new services.

Secondly, business hasn’t stopped completely. In fact, the enterprise domain continues to operate and remains an attractive potential market for operators.

Thirdly, the crisis has highlighted the importance of introducing cost savings into businesses. Of course, all businesses are rightly concerned with eliminating unnecessary costs generally, but there is an additional imperative for reducing overheads during the current crisis.

Fourthly, productivity has emerged as a critical issue. All businesses are looking for ways in which they can increase the productivity of their existing employees. This may seem obvious, but it’s easy to overlook individual productivity during years of plenty if positive results continue. But, when these are affected by external forces, it places productivity into sharp relief and employers have to consider ways in which they can – to be blunt – obtain more value and utility from their existing resources, which means increasing productivity levels.

Fifthly, there are signs that the rush to adopt broadband is slowing and, according to industry research group Analysis Mason, will subside to single-digit levels of growth. Broadband is now ubiquitous and many countries are close to saturation, particular in enterprise markets. It’s not going to be possible to meet targets simply by signing up new customers. In fact, broadband access is now simply a commodity, so price erosion will become a significant factor, if it hasn’t already. Where will growth come from if there are fewer customers to recruit to offset this price erosion? Operators need to stimulate growth from their broadband networks by other means than simply the dash for new subscribers.

Finally, just as employee productivity is brought under the spotlight, so too is that of network resources and assets. Network operators need to ensure that they maximise returns from the infrastructure they own. This means sweating these assets and ensuring that existing assets continue to deliver a return, even as investment in new assets proceeds. Compatibility between all elements of the infrastructure is essential.

Happily though, the conjunction of these lessons creates a win-win solution for both operators and their customers. That is to say, there are services that operators can launch that specifically target enterprise markets, which help them to deliver cost savings and productivity enhancements to their customers, whilst at the same time satisfying their own goals for return on investment, network productivity and return on existing assets. And, which can satisfy the enhanced diligence that surrounds investment decisions in both operators and their customers alike.

Mobile IP Centrex is one such service. Mobile IP Centrex allows enterprises to consolidate their fixed and mobile devices into a seamless private network, with the same PBX features available to users regardless of whether they are using a fixed or a mobile device, potentially yielding dramatic cost savings.

Calls can be made using short cut dialling within the enterprise, or to any number outside. Productivity gains result from the fact that calls can reach users irrespective of location via configurable transfer and hunting options, leading to fewer missed calls, voicemail retrieval attempts and more time talking to real people. Additionally, users can benefit from the same features on their mobile handsets as from fixed devices, ensuring that there is no productivity loss when switching between mobile and fixed stations.

Launching a Mobile IP Centrex service can allow operators to ensure that they attract a premium for their broadband infrastructure, with subscribers paying additional monthly fees for the new value-added service. Moreover, the right Mobile IP Centrex platform can integrate seamlessly with their existing network assets – for example, their Intelligent Network infrastructure – as well as support their planned migration to IP and SIP-orientated networks.

There has been much discussion of two sided business models in the press over the last year or so. These can only work if there is a strong need for the services on offer on both sides, making realisation potentially complex as there are more stakeholders involved in the transaction. Mobile IP Centrex is much simpler – and, importantly, two dimensional.  It fulfils definite needs from the enterprise, and it satisfies operator’s imperatives for services that

  1. offer revenue and profit potential; and
  2. leverage existing assets and increase their productivity.

During the current climate, these requirements have become even more important. It’s an old canard that every crisis creates an opportunity. But, it seems undeniable that the needs of businesses in terms of cost reduction and productivity gains, and those of operators in terms of maximising return on assets and building value on top of commodity revenues have aligned. The crisis has exacerbated the impact of these imperatives – and make it all the more important that operators provide solutions that can capitalise on this alignment.

Delivering capabilities demanded by enterprises and which can reduce costs and increase productivity, yet providing a differentiated value-added service that can be deployed on any network infrastructure, Gintel’s Easy Virtual PaBX is the perfect solution for this. Would you like to learn more?

Tore Saeter, March 2009.


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