Going Mobile? Have a Strategy!
There is no doubt that today’s workforce is much more mobile than it used to be years ago. It’s become even hard to define mobility and mobile workers – do we only refer to people frequently on the road, or also commuters and remote workers? And then where do you draw the line between mobile and deskbound workers – more specifically, how mobile are mobile workers? Are they away from their desks 20 percent of the time, 50 percent of the time, more, less? But strict classifications only matter when you are actually designing a strategy and selecting the most appropriate solutions for your workforce. The fact that everyone is becoming increasingly mobile cannot be denied.
As customer demands evolve, so do vendor strategies and solutions. In fact, one may say that mobile technologies (devices, apps, etc.) are proliferating even faster than mobile workers. With that, choices are harder to make. Which is the right solution for your business and your workforce? With mobility solutions being so diverse, they are even hard to compare, so how do you choose the solution that’s best for you?
A good starting point may be to consider what mobile solutions your employees are bringing into the enterprise. We talk a lot about “consumerization of IT” and most of the time we are referring to professionals using their mobile devices or some consumer apps (such as Skype, Facebook or Twitter) to conduct business more efficiently. In fact, consumerization has redefined mobility. An increasing number of workers are bringing their high-end smartphones and tablets to their workplace and using them for storing company information, leveraging the enterprise WLAN for communication or Web browsing, using social networking tools to communicate, and accessing embedded multimedia tools. Due to this phenomenon, an increasing number of employees are beginning to request some level of technology and application support from their IT departments. Some facts provide further evidence of the power of this trend. In less than three years, the iPhone became mainstream in 80+ percent of the Fortune 500 companies; in less that two years, Android business users reached three million; in under a year, tablets have gone from newbie to necessity among technologists and mainstream buyers alike. As employees increasingly use their personal iPhones and iPads for business, IT needs to take note.
But the consumerization of IT and its imact on mobile business communications poses signifcant challenges to IT. A few months back, Melanie Turek, Industry Director with Frost & Sullivan wrote:
“To that end, companies have several options:
- Provide (i.e. buy) one standard device in each category (smart phone, tablet) for a growing number of employees. This lets the business own the hardware and software, and maintain security and control over identity, applications and network traffic—as well as what happens to access and data when the employee leaves the organization. The downside, of course, is that it will significantly increase the IT budget, and it limits choice for employees.
- Ask employees to use their personal tools for business, but officially support one or more devices with business applications. This keeps the budget in check, and it gives IT nominal control over the business applications employees use on their mobile devices. But it forces users to juggle multiple “identities” on a single device, and it does not give the company true security, since employees can download any applications they like on a smart phone or tablet that they own. It also doesn’t ensure that contact info stays with the business when the employee leaves.
- Don’t purchase or support mobile devices for the majority of employees. This keeps IT out of the mobility game, and it is the least expensive option—in the short run. In the long run it could prove costly indeed, as employees either hack their devices to run enterprise apps under the radar, or follow the company’s policy lead and don’t attempt to work from anywhere but their office PC.
Deciding on a mobile policy will be one of the biggest budget and technology-support challenges for companies in the years to come, and it will involve business decisions as much as technology ones.”
My colleagues Alaa Saayed and Francisco Rizzo will provide a perspective on enterprise mobility in an upcoming free webinar. If you are interested in attending, please follow this link to register: http://t.co/RJXEpub
Is IP Communications Really for Me?
I know. You have heard enough about IP communications, unified communications, cloud communications, and any other fancy communications the industry pundits choose to talk about. But it’s still hard to make the right decisions. Vendors are sending confusing messages. Your internal stakeholders are not agreeing on what is best for your business. It may be worth for you (IT or telecom person) to sit down and think really hard (again) about your specific challenges and objectives and then make some better informed and more confident decision about your infrastructure evolution.
IP communications, VoIP, UC, etc. mean different things to different people. Benefits vary from business to business. Deployment methods vary from business to business. The more technology evolution accelerates and the more complex communications architectures become, the more important it is to go through a proper assessment and discovery process prior to make radical, or even incremental, technology changes.
But you are always too busy to strategize. There is always too much on your plate – and everything needs to be handled right here, right now. And that’s how you get trapped in a vicious cycle – having to make rash decisions to only partially resolve major operational or strategic issues.
It’s hard to do, but you need to take the time and launch a structured initiative, with all key stakeholders on board, to properly analyze your challenges and recommend sustainable, long-term solutions. This is the only way you can make your infrastructure work for you – make you more efficient and a more valuable asset within the organization.
I will be talking about the benefits of IP communications, the evolving value proposition of IP telephony and the key elements of a proper assessment and discovery process at this free webinar on June 14, at 11 am ET. To register, please follow this link. A recording will be available if you are unable to attend.
SIP Trunking Helps Bridge the IP Islands
Businesses are gradually migrating to IP-based platforms and solutions. Frost & Sullivan’s research shows that most businesses that have not yet deployed IP telephony plan to do so in the next few years. But not everyone is ready to make the move. And practically no business is willing to forklift its entire existing infrastructure overnight.
The major holdbacks in IP telephony and UC adoption are typically related to concerns over how to protect existing, unamortized assets and ensure continuity when migrating to new communications architectures. Therefore, most businesses are cautious in their implementation of VoIP and IP telephony and are only gradually migrating individual platforms and sites, thus creating “islands” of IP technologies within the company’s communications environment. SIP trunking helps bridge these islands.
VoIP access and SIP trunking services involve the provision of integrated circuits using VoIP or SIP technologies to enterprises that have implemented premises-based enterprise telephony solutions (Private Branch Exchanges (PBXs)/IP PBXs or key systems). In a VoIP access or SIP trunking scenario, the service provider typically offers local dial tone, long-distance calling, and a limited set of call-management and control features such as extension dialing to intra- and inter-office locations.
VoIP access and SIP trunking services essentially direct enterprise customers toward a path of gradual transition to fully converged, IP-based networks. They allow businesses to enjoy the benefits of IP telephony while eliminating the need to forklift-upgrade their networks. VoIP access services interfacing with a legacy TDM system do require the deployment of a voice gateway at the enterprise premises, whereas SIP trunking services are typically deployed with SIP-based or SIP-enabled enterprise telephony platforms where protocol conversion is not required. Session border controllers (SBCs) may, however, be needed for protocol normalization and security purposes. Typically, VoIP access and SIP trunking services allow enterprises to continue to utilize their existing handsets as well as other TDM voice customer premises equipment (CPE) thereby preventing significant upfront investments.
Increasingly, service providers are bundling VoIP access and SIP trunking services with various network-based communications applications and capabilities, such as hosted auto attendant, voicemail, unified messaging, mobility/FMC or some data services including web hosting, web email, managed security, and so on.
Join Frost & Sullivan and Level 3 for a presentation on sustainable business voice strategies with a key focus on SIP trunking and its benefits to small and large businesses: http://bit.ly/lXeeJw
Overwhelmed? Maybe it's Time to Share or Delegate
There is no denying IT and communications technologies are evolving at a head-spinning rate, requiring continued investments in infrastructure refresh, staff training and organizational restructuring. Managed and hosted services can help relief the burden on overwhelmed IT staff and provide access to superior expertise at predictable monthly costs. But are businesses seriously considering managed services?
Frost & Sullivan’s 2010 communications & collaboration technologies end-user survey, which targeted 200 North American C-level executives, reveals that 62% of respondents’ organizations currently use managed services. Of those current users, 63% plan to increase usage over the next 12 months, and an impressive 42% of non-users intend to implement managed services within the near term. The main reason (stated by 36% of respondents) why businesses choose to pursue managed services is the need to consolidate multi-vendor relationships and solutions management, followed by limited expertise in new/specific products and technologies (34% of respondents).
Here is how respondents ranked the drivers for using managed services:
Businesses can use managed services from a variety of market participants, including vendors, VARs, systems integrators and telcos. The following chart shows that most of our respondents choose to outsource managed services from their vendors:
No surprise there – no one know Avaya better than Avaya, and no one knows Siemens better than Siemens. Also, most vendors are better equipped with remote technologies and NOC facilities to provide QoS and performance management than their smaller resellers.
But almost a quarter (23%) of respondents indicate they use several different managed services providers. While this scenario presents the advantages mentioned above, it is not very cost-effective. Frequently, each vendor relationship is managed by a separate group of people adding a significant overhead. Each contract needs to be negotiated separately and it’s hard to leverage any significant discounts or economies of scale. Businesses find themselves in this situation because they typically manage disparate, multi-vendor infrastructures as a result of M&A or due to varying technology requirements by site or remote location.
As businesses look to consolidate their infrastructure and develop a more coherent roadmap for the evolution of their IT environment, a strategic partnership with a single managed services provider can offer the greatest benefits in the long term.
A recent announcement by Siemens Enterprise Communications about enhancements to its OpenScale services portfolio point to vendor efforts in the following key areas:
- Portfolio standardization and simplification (3 standard options based on degree of support required)
- Flexibility for potential customization (site-selectable SLAs, custom reports, ability to add modular components to the main package – e.g. MACs, proactive software updates)
- Channel benefits (active monitoring exclusive for channel partners, possibility for e-bonding with partner billing and management systems; sell-through and sell-to options available)
- Multi-vendor managed services (across Siemens and non-Siemens data networking and call control platforms and applications)
- Comprehensive package of application, server and network management
- Global delivery
Other communications vendors, VARs and systems integrators are ramping up their managed services capabilities as well. I put together a table comparing the different types of managed services providers based on a set of criteria, which I believe are important for end users looking to select a managed services partner:
Each customer case is different, but a systematic approach to selecting a managed services provider could ensure that all enterprise requirements are properly addressed in the contract:
How to Find a Managed Services Partner
We recently completed our Frost & Sullivan 2010 North American Enterprise Telephony Equipment and Implementation and Management Services Markets update. The study found out that, in 2009, that market generated about $4.35 Billion in revenues from the delivery of telephony customer premises equipment (CPE) services, which represented a decline of about 10.7% from 2008. The global recession was the single most powerful factor causing the revenue decline.
While implementation services, closely correlated with telephony equipment shipments, were severely impacted by CAPEX reduction policies, budget constraints were, in fact, one of factors driving demand for managed services. Alaa Saayed, the lead analyst on this project, observed: “Some of the main drivers for managed CPE services adoption include the ability to select the management of specific ongoing administrative tasks (modularity) rather than outsourcing the entire operation, the advantage of cost savings and profitability because of performance optimization, the benefits of problem prevention through the use of proactive remote management tools, and the ability to monitor and manage different systems and networks throughout a multi-vendor, multi-site environment.”
An increasing number of enterprises report utilization of managed services. A 2009 Frost & Sullivan survey, that interviewed 102 U.S. C-Level executives, revealed that companies had either maintained or increased their use of managed services within the previous 12 months.
The same survey reported that only 7 percent of the respondents were planning to decrease the usage of managed services within the following 12 months. Overall, C-Level executives were planning to continue their current use of hosted or managed services, or even increase their utilization within the next 12 months. This is not too surprising since managed services play an important role in addressing the IT and telecom management needs of an organization in the time of a recession. As organizations cut costs to stay afloat or improve their competitive positioning, they typically seek to compensate for reduced internal resources and improve network and overall organizational efficiency by partnering with an experienced managed services provider.
Demand for managed services varies by the size and type of business. Small enterprises are more likely to utilize contractual maintenance, hosted solutions or economical managed CPE alternatives. Medium enterprises, on the other hand, are more likely to employ a piecemeal approach to network management outsourcing, whereby large companies may either opt to manage their telecom and IT infrastructure in-house, or outsource management to ensure a more uniform approach to their multi-vendor, multi-sited environment.
Similar factors seem to trigger the acquisition of managed services across different company sizes and verticals. As managed services are primarily adopted by those looking to reduce labor costs, customers tend to first resort to the lowest-common-denominator package – some remote monitoring and alarms, backup & restore, limited help desk, basic software updates (no major upgrades), a package of MACs, and so on. They could, eventually, move up the ladder based on their individual needs and demands.
The CPE services market is becoming more fragmented over time – with few service providers possessing all the required skills to manage all aspects of a customer’s ICT infrastructure. In fact, Alaa states that there is some confusion about who’s offering what: “Customers are finding it hard to understand where to look for CPE telephony services. They find the relationships among telcos, value-added resellers, system integrators, manufacturers and their channel partners confusing. When searching for managed or professional services, they often run into an overlap of solutions and responsibilities. Single point of contact is becoming key to avoid these multiple and confusing relationships.”
Here is what the competitive structure in this market looks like:
In terms of revenue, traditional equipment manufacturers have the largest market shares with stable or flat growth prospects. Telecom operators and system integrators are experiencing an increasing demand for services as they can offer economies of scale and competitive managed services packages. VARs, on the other hand, seem to serve specific markets where either local presence or some technical specialization is required.
In terms of brand name recognition, the leaders of the pack include established vendors market participants such as Avaya, Cisco, Mitel, NEC and Siemens among telecom equipment manufacturers; Black Box, Shared Technologies and Dimension Data among telecom VARs; major systems integrators such as IBM and HP; and AT&T, Verizon, Bell Canada and Telus among telcos.
While some traditional equipment vendors directly compete with their channel partners, others prefer to delegate most telephony CPE services to channel partners. Channel-centric vendors acknowledge the fact that dealers and other partners are turned off when vendors compete against them and take away the best deals. Therefore, such vendors choose to ensure the support of their channel partners in growing product revenues at the expense of services revenues, which they leave entirely to the partners.
We asked the channel what they expected from their vendors and here is what they told us:
Also, the channel commented on the overall level of support they received from their vendors over the past couple of years:
For businesses looking to outsource SPE services and managed services more specifically, we recommend they select their partners based on:
- Financial viability
- Product and services roadmap (including SIP expertise and ability to support next-gen SIP and SOA-based architectures)
- Multi-vendor technology support capabilities and ability to consolidate multiple vendor relationships through a single contract
- Customer service and attention to specific customer requirements
- Flexibility to provide modular capabilities and price services based on application complexity rather than total number of users
- SLAs covering resolution and not just response times. One of the biggest pitfalls in managed services is the inability of certain vendors to guarantee the latter in spite of their commitments to the former.
- Managed services vendor staff training and experience. Staff turnover is one of the industry’s major challenges and service providers that invest heavily in staff training and job satisfaction can deliver the greatest value to their customers.
- Find your best match! For a global organization, a large, global SI may be best, but for a small business, a local partner is more likely to provide greater attention and a customized approach.
Unified Communications: Where do we Go from Here?
After several months of hard work, we have now completed the update of our World Unified Communications (UC) Markets study. The reason why I feel like celebrating (more so than after any other study) is because this market presents some unique challenges. Typically, we discuss and analyze markets by product or service category – e.g. the enterprise telephony platforms market, the enterprise media gateway market, the videoconferencing endpoint market, etc. But unified communications is all about … well, unification … that is, application integration. At the risk of repeating myself and stating what may be the obvious for some, here is how we define UC:
“Frost & Sullivan defines a unified communications application as an integrated set of voice, data and video communications, all of which leverage PC- and telephony-based presence information. UC applications are meant to simplify communications for the end user by making it easy to “click to communicate.” A unified communications application must contain the following:
- PC-based presence (online or offline)
- Telephony presence (on the phone or available for a call)
- Point-to-point voice calling
- Chat (i.e., instant messaging)
- Audio conferencing
- Web collaboration (application, file, and desktop sharing)
- PC-based video
- Find-me/Follow-me capabilities (for call routing)
- Unified messaging
A unified communications application may include the following:
- Mobile client
- APIs for easy integration with other applications
- Social networking capabilities
- Wikis/blogs
- Integration with room-based video conferencing
- GPS or other location information”
The past couple of years were challenging for communications vendors as the recession forced many businesses to suspend or delay investments in communications technologies. Tighter budgets limited the penetration of most UC applications. The telephony market was one of the hardest hit, as most vendors experienced double-digit year-over-year revenue declines. Conferencing applications and services fared better, as they allowed businesses to reduce travel costs while enabling virtual workers to communicate and collaborate more efficiently. Even conferencing markets, however, experienced increased price pressures, with the impact of the recession being most severe in conferencing endpoint markets and in the more mature audio conferencing services markets.
In 2009, UC vendors focused primarily on penetrating the market with advanced UC clients. IM and email vendors aggressively upgraded their customers to UC-capable IM clients and architectures. Similarly, telephony vendors bundled advanced softphones capable of integrating with IM clients and conferencing platforms with the rest of their telephony solutions to encourage adoption. While these vendor strategies help increase user familiarity with software-centric communications and their benefits, they are not strongly correlated with investments in the rest of the infrastructure required for a complete UC implementation. Customers deploying softphones from their telephony vendors did not always purchase the conferencing and/or IM/presence servers. Similarly, many customers who purchased Microsoft’s OCS Enterprise CALs did not choose to use OCS voice or to integrate OCS with the corporate telephony system.
Overall, we do not believe UC will be a big revenue source for the vendors (which is great news for customers!) That said, we believe it is here to stay. Vendors will give away UC clients to drive adoption of various advanced communications solutions – conferencing, collaboration, mobility – as well as telephony and IM infrastructure refresh. As business users become increasingly used to the convenience of certain UC capabilities such as soft clients, conferencing capabilities that are only a click away, affordable video, and so on, it will be difficult to take those away from them.
But who should customers turn to for their UC capabilities? There is no single right answer, of course. Two distinct business models have emerged: on-stop shops and best-of-breed integrations.
For SMBs, all-in-one appliances or application stacks are probably most appealing. However, few vendors are capable of offering, on their own, all the required functionality and features in the UC stack. Either the telephony component is still missing critical elements (such as E911), or the IM clients are not very feature-rich, or some other capability is lacking.
Larger customers with multi-vendor environments are better off selecting the specific applications that best meet their needs and then engaging their own (typically more extensive) internal staff or outsourcing the professional services expertise to integrate those capabilities in an end-to-end UC environment. Limited vendor interoperability along with scarce UC expertise will present some serious challenges to this approach in the near term but will become less of a concern in the future. Growing adoption of SIP and SOA and application enablement technologies, and vendor strategies focused on contextually-rich communications and communications-enabled business processes will have a major impact on vendor interoperability and will eliminate a great portion of the hassle and cost related to application integration and UC implementation.
Generally, UC adoption may remain limited to specific user groups (e.g. knowledge workers, marketing and sales people) for the next few years, until business models make it compelling for the average communications user to own a UC solution even if they are not using all of its capabilities and not benefiting as much as the early adopters.
Here are some recommendations to end users considering UC:
- Businesses should leverage their communications investment to gain a competitive advantage and should make new technology acquisitions with their key strategic objectives in mind.
- Vendors are engaged in a more fierce competition than ever before. Customers can exploit this opportunity to require exceptional value for their money.
- Customers need to future-proof their investment. They should seek to deploy open and flexible standards-based technologies. Further, they should demand extensive education and training on features and integration capabilities to ensure that they can easily switch among or integrate multi-vendor solutions.
- Customers should pay attention to their vendors’ and channel partners’ overall financial stability. The recession has weakened a lot of market participants and growing competition will further jeopardize their viability.
- Customers need to restructure internally to ensure they gain maximum value from their IT and telecom investments. They must ensure cooperation between the telecom and IT teams so they can effectively coordinate new investments and ongoing infrastructure management.
- Finally, customers should explore alternative delivery models (e.g. managed services, hosted solutions, etc.).
For more information on our study, please contact me at epopova@frost.com or review related material on our web site at http://www.frost.com/srch/content-search.do?srchid=194001017.
Are the Days of Single-mode VoWLAN and DECT Phones Numbered?
With the growing hype around FMC and the continued integration of mobile phones with corporate communication networks, one would think that onsite mobility solutions are becoming an extinct species. I, personally, don’t think so. Single-mode VoWLAN and DECT devices provide productivity-enhancing mobility to individuals that do not fit the profile of potential smartphone users, and, therefore, do not compete with mobile phones for the exact same opportunity.
In the carpeted office, we expect professionals to increasingly use mobile phones connected to corporate PBX systems leveraging advanced UC clients. Such individuals are most likely users of cell phones subsidized by the company as they are expected to be able to make or receive calls anywhere, any time, in order to better serve customers, partners or internal stakeholders. Those are typically sales or marketing people or top executives. Beyond the carpeted office, maybe doctors, real-estate brokers, lawyers, technical support, and a few other professions requiring immediate and around-the-clock contact represent possible target customers for FMC solutions providing corporate communication applications on mobile devices.
Onsite mobility solutions, on the other hand, will continue to provide valuable capabilities to verticals where individuals need to communicate efficiently while on the premises, but do not need to be available for business purposes after working hours. Healthcare, retail and manufacturing continue to account for the majority of VoWLAN implementations (41%, 13% and 7%, respectively, of 2008 new users) with hospitality, education and government offering some growing opportunities. The carpeted office accounted for about 19% of all VoWLAN single-mode new users in 2008. DECT has been more successful in the carpeted office with over 40% of new users in 2008 being in this market segment.
Frost & Sullivan recently published a study, authored by my colleague Alaa Saayed, that provides an in-depth analysis of this market space. Here follows a summary of the findings:
As in the case of many other technology markets, the world enterprise DECT and VoWLAN single-mode phone market has been considerably impacted by the economic crisis. With market growth rates already showing some signs of deceleration in 2008, economic conditions in 2009 seem to be presenting even greater challenges as business customers seek to cut costs by extending the life of their existing wireless devices, curtail investment in new technologies and select the product or vendor based on pricing rather than strategic value.
Moreover, DECT and VoWLAN single-mode technologies have started to feel the pressures of other types of carpeted-office mobile devices, such as advanced smartphones with built-in enterprise FMC solutions, that, in some cases, present a compelling value proposition to IT departments seeking to provide employees with a single device offering multiple capabilities.
Despite this challenging landscape, the world enterprise DECT and VoWLAN single-mode market is expected to gradually return to its healthy growth rates in 2011 – as more vertical industries across the world recognize the various benefits and capabilities granted by these types of on-site mobility solutions. Moreover, the potential short-term slowdown in this market may be attenuated by the fact that enterprise FMC solutions are still viewed as very nascent technologies, and enterprises wishing to avoid any possible hurdles would, in most cases, prefer the reliability of DECT devices or the maturity of single-mode handsets. It should be noted, however, that any growth may be much slower than what it could have been in a healthier economy.
In terms of handset evolution, many of the major DECT phone manufacturers have launched new advanced DECT handsets into the market. Some examples include Aastra’s new series of next-generation SIP DECT handsets (the 610d entry-level handset, the 620d business version handset, and the 630d industrial handset), Ascom’s new generation d41 and d62 IP DECT handsets and NEC-Philips’s I755 phone and advanced M155 watch phone.
On the other hand, some of the technological advancements that new DECT solutions have introduced to the market include advanced messaging and alarming systems, centralized management capabilities, location detection capabilities and central directory and presence information. Today many DECT market participants affirm that the new capabilities offered by DECT technologies equal or even surpass those offered by VoWLAN single-mode devices. Cat-iq is said to further increase the value proposition of future enterprise DECT in terms of better voice quality, Web access to applications, and lower power consumption.
In terms of VoWLAN single-mode market evolution, most of the basic VoWLAN challenges, such as reliability, voice quality and security, have been resolved through continuous improvements and advancements in handset capabilities, adoption of wireless standards, and partnerships among device vendors, IP telephony providers and WLAN infrastructure companies.
New handsets capabilities include enhanced interfaces, additional software functions, new form factors (smartphone looking devices), improved device durability, and integration with advanced messaging, push-to-talk, and location-based features and applications – among others. Evolving wireless standards that are either being implemented or considered for future implementation include 802.11n, 802.11r, 802.11e and WPA2 security certifications. Finally, the market has witnessed the partnership of two of the major VoWLAN single-mode participants: Motorola and Vocera – that is expected to further increase the adoption and implementation of VoWLAN single-mode devices in the healthcare and retail industry.
Growth Rate Comparison
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