Editor’s Note: Welcome to our weekly Reader Forum section. In an attempt to broaden our interaction with our readers we have created this forum for those with something meaningful to say to the wireless industry. We want to keep this as open as possible, but we maintain some editorial control to keep it free of commercials or attacks. Please send along submissions for this section to our editors at: dmeyer@rcrwireless.com.
Research from Ovum tells us that in 2013, mobile operators forfeit $32.5 billion dollars in messaging revenues to free applications like WhatsApp and Viber. There is an old Stoic proverb describing a dog tethered to a horse-drawn chariot. The horse pulls the chariot, and along with it the dog. The dog now has two options: either it resists and is inevitably dragged by the bigger and more powerful animal, or it chooses to run and be spared a grim fate.
Bringing this back to the operator world, over-the-top players have already changed the whole media and communications landscape. There is no going back; there is a new reality to face. Added to that, mobile operator penetration is at an all-time high and competitive pressures continue to drive down pricing for consumer services. So rather than resisting this new economic reality, the operator world needs to address the markets where it knows it can have a positive effect and build revenues for the next decade. So where does this new and stable stream of revenue come from?
According to telecommunications expert Aditya Chaudhuri, the enterprise telecom market is in the billions of dollars, and growing at a compound annual rate of 13%. Right now, enterprises predominantly employ fixed-line networks for their telecommunication needs – in developed markets at least. The time is right to tame a new beast, the enterprise market.
The total number of employees in 100 to 4,999 manned firms, spanning the United States and the European Union, in 2014 is estimated to be 73.1 million. This number is expected to increase to 83.3 million by 2020, showing exponential growth in just six years. Mobile operators offering exclusive and specialized service packages to business enterprises presents them with a potential cumulative hundred-billion-dollar market contingency.
Mobile operators are in a unique position to address the needs of enterprises. More and more enterprises are becoming mobile and mobility services give MNOs a strategic advantage. In addition, in many parts of the world, there is no fixed network and the mobile network is the only game in town. While offering new features, operators need to be careful about their own operational and capital expenditures. For backhauling existing and new services, there are three possible platforms that wireless operators may choose: copper, fiber and microwave.
Copper is not up to the job from a capacity perspective, leaving fiber or microwave as only viable transport technology options.
Fiber possesses an unrivaled ability to move near limitless amounts of data backhaul. However the devil is in the details. It requires extensive infrastructure, as well as access to every area where its lines are projected to be placed; depending on topography, placement can prove difficult. Because of this, as well as the massive timescales synonymous with installing fiber, ever increasing by the foot or meter, fiber installation is usually prohibitively expensive.
Wireless access solutions using microwave or millimeter wave technologies are conducive to any type of landscape, and are flexible and cost effective for rapid deployment when compared to fiber. Today’s generation of microwave and millimeter wave wireless solutions deliver traffic carrying capacities up to several gigabits per second, dwarfing cable and copper while presenting a level of reliability close to perpetuity, as it is not subject to line breakages.
The enterprise telecommunications market is gaining huge momentum in developing regions like Africa, the Middle East and much of South America. With limited existing fixed-line fiber and copper infrastructure from traditional telecom service providers, the mobile networks with their increasing density of cell sites offer the platform to provide access and enterprise services in a matter of days using microwave backhaul. In new frontiers such as these it is always the quickest to the mark that bags the prize, and in an area of little pre-laid infrastructure, microwave is the only viable option. Traditional microwave however requires separate routers to delivery higher layer IP-based services critical for most communication solutions.
With new innovations like microwave routing, new enterprise services like VPNs can be set up and handled at the network edge without the addition of separate router – meaning fewer boxes to buy, deploy and maintain. That means that as well as the increased throughput that new microwave routers enable for enterprises, there is a whole new set of powerful services that enterprises want and need. For enterprises in emerging markets, the wireless operator is often the only game in town and now it can have a much better game than any of its rivals. And in developed markets, the availability of a secure wireless data network available through any mobile device is surely an incredibly attractive prospect for tens or hundreds of thousands of risk-averse enterprises. The enterprise “beast” can absolutely be tamed … it just needs the right proposition.
As SVP and chief marketing and strategy officer, Shaun McFall provides overall direction for programs to position the company in its focus markets. McFall has been with the company since the formation of its U.K. subsidiary in 1989. His initial assignment was in new business development, first in the United Kingdom and later the European market. In 1994 he relocated to the company’s headquarters in San Jose, Calif., assuming responsibility for worldwide product marketing. He has accumulated over 20 years of experience in the wireless telecommunications industry, holding prior positions with two U.K.-based companies: Ferranti International Signal plc and GEC Telecommunications Ltd. McFall holds a bachelor of science degree in Electrical and Electronic Engineering from the University of Strathclyde in Glasgow, U.K.
