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There’s no need to point out that the mobile Internet is now, quite literally, at our fingertips. It is not only driving, but owning today’s digital lifestyle as people all over the world are using the Internet anytime, anywhere and mostly via mobile devices. In response, service providers have responded with new offerings such as unlimited data plans. But as we see the evolution of data plans continue, so too has customer-centricity, and users are increasingly becoming aware that they don’t need unlimited everything if they can have it tailored to their needs – and by that we mean their specific mobile-application needs.
Mobile operators around the globe are transforming into digital lifestyle service providers. Unlimited data plans are becoming an offering of the past as operators begin to leverage popular apps and content – such as video, music, cloud storage and social media – to create new personalized service plans based on the way subscribers live, work and play. In our report earlier this year, which surveyed almost 180 mobile operators worldwide, we found that unlimited data plans have diminished from 35% in 2012, to 15% in 2014, while the percentage of operators offering value-based plans grew from 35% in 2011, to 59% in 2012, to 85% in 2014.
These application-centric plans are often the result of collaborations between network operators and over-the-top content providers. Operators can leverage OTT applications to attract customers and offer them a choice between different levels of access, such as offering unlimited social media usage or Voice over Internet Protocol minutes. The partnership benefits both parties by increasing subscriptions and customer loyalty to both the app and the delivering network.
NFV to play a major role in helping monetize the ‘personalized everything’ frontier
Mobile operators need application-aware solutions that support a dynamic variety of partnerships, policy and charging requirements, and facilitate rapid-rollout service plans. As a result, these operators are increasingly introducing value-based plans, making it possible to charge for the value of the service to the customer and not just the speed. The joint services between operators and OTT application providers also enable operators to monetize traffic on their networks, consolidate the billing process and improve the user experience for subscribers.
The solution to value-based plans lies not only at the collaborative level, but also at the deeper network level. New developments in network function virtualization technology are making the deployment and management of services fast, scalable and cost-effective. Broadband carriers and service providers are looking to NFV to help lower the cost and increase the revenue from the network services they offer. It improves service delivery and consistency and enables immediate activation of services without any truck roll or forklift upgrade at the customer premises. An NFV approach provides greater business, technological and operational benefits when compared to traditional service concepts.
With all the benefits in mind, NFV also introduces daunting challenges. As functions are virtualized, network operators must be able to work seamlessly with physical network functions that are still in place. Likewise, they must be able to harness the benefits of NFV to make it easier to monitor, analyze, control and charge for network services.
As part of the NFV landscape, a virtualized traffic detection function has the ability to bring application awareness to service providers’ access networks. Virtual TDF provides essential, virtualized functions including traffic detection, analytics, policy enforcement and charging. These types of services make it easier for carriers to create, deliver and monetize data services by connecting and coordinating the data and control planes for delivering services. The virtual platform identifies subscriber-application traffic and enables policy enforcement and charging actions – such as application-aware traffic management, congestion control, online/offline charging and traffic steering to added-value services – to be applied to the traffic flows in real time.
Given the compelling benefits of NFV, operator investment in network virtualization is growing fast – as Infonetics Research recently reported, the software-defined networking and NFV market is expected to hit $11 billion by 2018. Operators are now determining which part of the network to tackle first; how to approach the migration; and how to demonstrate at every step along the way that the intended benefits are being realized.
Catering to digital lifestyles and personalization will only continue to drive the generation of services providers can monetize and deliver to consumers. By branching out of the one-size-fits-all unlimited data plans to offer premium plans based on customer choice of value-added digital lifestyle services, mobile operators will be able to improve customer retention and increase brand loyalty to the service provider.
Advancing NFV technology and applying it in new ways to address these needs, mobile operators can generate new revenues from a variety of application-centric services and charging schemes that integrate seamlessly in the network and are managed from a single focal point. Not only are operational costs reduced by optimizing the delivery and performance of OTT content, so too is the time-to-market for new services, providing a better user-experience for customers.
Yaniv Sulkes is a telecommunications professional engaged in designing, developing, productizing and marketing industry leading solutions for over 14 years. Sulkes currently serves as the AVP of marketing for Allot Communications. Prior to Allot, Sulkes managed a large-scale telecom engineering project and served in different software engineering capacities. Sulkes has an M.Sc. in Electrical Engineering and B.Sc. in industrial engineering and management from Tel-Aviv University.
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