Companies cut costs and complexity by outsourcing wireless infrastructure
Wireless infrastructure is increasingly differentiated by software, and enterprises are learning that they can reduce complexity by outsourcing infrastructure management. Many enterprises are taking this one step further by turning infrastructure ownership over to suppliers in order to reduce capital expenditures. This is a model that wireless carriers have used for years, leasing towers from companies like Crown Castle and American Tower so that the carriers do not have to tie up precious capital in real estate assets.
As wireless connectivity becomes a “must-have” for many businesses, enterprises are starting to look at the managed services model. To date, this model has been more widely adopted for Wi-Fi deployments than for cellular.
Wi-Fi as a service
Shane Buckley, CEO of Wi-Fi access point maker Xirrus, sees customers in hospitality, retail and education adopting a managed services approach to wireless infrastructure. Since many of the capabilities that companies want from their Wi-Fi systems are cloud-based, paying for these as a service makes sense. Wi-Fi as an operating expense also works well with the cash flow patterns of many businesses.
“These are new emerging companies that see the opportunity to use the strength of the balance sheet in order to create an opex out of something that is normally a capex,” said Buckley. “A lot of businesses don’t have a lot of capex to invest.”
Buckley offered the example of a private gym, which relies on monthly membership payments. Wireless service can be a monthly expense, he said, and can offer much more than just getting online to check email. Buckley said cloud-based Wi-Fi can allow gym members to automatically authenticate their devices and go directly to their preferred TV and music channels.
Managed hosting
Managed hosting is a slightly different type of managed service. Managed hosting typically refers to a model in which enterprises build infrastructure in a service provider’s data center, and pay the service provider to manage and maintain that infrastructure. The customer can save money by leveraging the data center’s power and connectivity resources, which can be shared by multiple customers.
Companies can make the most of a managed hosting relationship by communicating with service providers. For example, if a company is rolling out a new mobile app to all employees, there is likely to be an impact on network traffic and the associated infrastructure. Since some of that infrastructure (i.e. servers) may share power resources with other servers, the service provider will do a better job of meeting the increased demand with advance warning.
Small cells as a service
Small cells as a service is a term that can have several different meanings. Ericsson uses the term to refer to a small cell network that can be shared by multiple operators and can integrate carrier-grade Wi-Fi. Or, the word “service” can describe offerings like unified communications and mobile device management that are enabled by a small cell network. Small cell vendors may use the term to describe a carrier offering that companies could pay for as an operating expense.
“To an IT manager, the phrase ‘managed solution’ means that they retain some control and have a secure environment, while benefiting from a solution that reduces IT overhead and capital expense,” said iGR Research founder Iain Gillott. He said that many IT managers are uneasy with the concept of small cells that are remotely controlled by a mobile operator. “IT managers do not want to lose direct control of the small cell environment,” said Gillott.
