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Emerging Trends: Telecom solutions for the enterprise segment

October 28, 2013

As the core telecom business continues to witness subdued growth, operators are increasingly focusing on the enterprise segment to improve their bottom line. The segment accounts for over 10 per cent of the total revenues of most operators and its contribution is likely to rise with the growing portfolio of enterprise services.

While large enterprises have the basic telecom infrastructure in place, small and medium enterprises (SMEs) have also started demanding end-to-end telecom services to improve operational efficiency, streamline the supply chain, ensure lower time-to-market and reduce opex.

So far, the telecom requirements of enterprises have been limited to leased lines, virtual private networks, audioconferencing, videoconferencing, VSATs, local area networks, internet, email and web hosting, among others. However, with growing digitisation, the introduction of smart devices and the shift towards converged networks, several new applications and solutions have emerged for the enterprise segment. Operators are gearing up to tap these business opportunities to fulfil enterprises’ future communications requirements.

tele.net takes a look at some of the current and emerging technology trends in the enterprise segment…

 Shift towards the cloud

Cloud computing continues to be the biggest revenue growth driver for telecom operators in the enterprise segment. Most large enterprises have shifted their data from data centres to cloud infrastructure in order to reduce opex and capex. In contrast, SMEs have been slow to adopt this trend.

In the past, SMEs were reluctant to implement data centre solutions such as co-location and hosting due to high capex. However, they are now adopting cloud services, which provide access to software, application development platforms and IT infrastructure at relatively low costs.

Among various cloud services, software-as-a-service (SaaS) has gained maximum traction as a result of its accessibility from smart devices at remote locations. SaaS allows enterprises to utilise proprietary software at shared costs with the pay-as-you-go model of cloud services, which reduces the opex for small enterprises and helps them earn better returns from their core business.

In addition, cloud-based services provide significant headroom to operators for growth as they have an edge over IT companies owing to the former’s long-term customer relationship with enterprises. Operators also have considerable expertise in deploying billing systems, managed services, and hosting and co-location solutions and can bundle their telecom offerings with cloud applications to provide unified communication solutions to the enterprise segment.

In their effort to meet the low-cost technology requirements of SMEs, operators are offering cloud-based storage, mobile device management and mobile security services. Meanwhile, a few global operators have also started providing an application programming interface to develop new business solutions.

However, with enterprises shifting their confidential data to the cloud, security and access control have become key concerns. Addressing these issues will be crucial for operators to capitalise on cloud opportunities going forward.

Disaster recovery and business continuity

Due to frequent power outages, unauthorised security breaches and systems malfunction, disaster recovery management (DRM) has become an important aspect of round-the-clock business operations. In the event of a downtime or shutdown, organisations are required to recover real-time information instantly to ensure business continuity. This can result in the loss of credibility and customers for a company, especially if critical data is compromised.

In order to avoid this, large enterprises have implemented a robust DRM process. In contrast, the SME segment has been reluctant to adopt DRM solutions due to lack of technical expertise, cost constraints and low benefit realisations.

Operators can tap this business opportunity by increasing awareness among SMEs about the potential benefits of adopting DRM solutions. Moreover, they are not likely to face any constraints while implementing these solutions given their knowledge of the communications and networking requirements of SMEs.

 Big data and analytics provide greater customer insights

Big data and analytics are emerging as key focus areas for enterprise service providers. At present, most service providers have access to the huge amounts of data generated by the usage pattern of the services offered to the customer. This data includes information about users’ call logs, online shopping details, downloads, etc. Operators process the information through analytics to gain insights about customer behaviour and general trends in the market. Data analysis helps them customise their offerings in line with user demands besides ensuring that services are delivered in a cost-effective manner.

Most large enterprises have an extensive supply chain and stores at multiple locations and carry out several transactions every day, which generates a huge amount of data pertaining to internal and external operations. Meanwhile, operators have access to information such as the demographic profile of customers visiting these stores. This information, coupled with transaction details provided by enterprises, can provide real-time customer insights, which in turn helps these companies customise their products accordingly and restructure their go-to-market strategies to ensure better returns.

That said, data analytics involves challenges such as privacy issues, the varying nature of sample data and small sample size. While privacy issues can be resolved by using generic customer data, problems related to sample size and fragmented data can be addressed through investments in human resources for building employees’ technical know-how as well as new data analytics and data mining technologies.

The segment offers significant growth opportunities for operators, which stand to benefit from the surge in the adoption of smartphones and tablets as well as the bring-your-own-device (BYOD) concept.

Enterprise mobility and emergence of BYOD

With the significant increase in the uptake of smart devices including smartphones and tablets, several companies are adopting the BYOD concept as it ensures improved employee productivity and considerable cost reduction. Employees are permitted to bring their personal devices to work in order to access the organisation’s network, data and software. BYOD offers employees more flexibility in carrying out their day-to-day operations. It also benefits the organisation as it reduces their opex and capex in providing dedicated workstations to each employee. As per industry estimates, BYOD can help large enterprises save up to $1,000 per month per user.

However, the BYOD model has its own set of implementation challenges. One of the biggest issues faced by companies’ IT administration  is the threat to data security. Remote IT support provided to the mobile workforce can result in significant network monitoring issues. In addition, as companies are required to provide connectivity to the mobile workforce, unauthorised access could lead to substantial data loss for the organisation.

Another issue is related to the third-party software and applications installed in these devices, which have uncertain security provisions. As these devices are connected to several other gadgets over wireless networks, there is a greater risk to data security.

Further, the high cost of support for devices with different configurations and technologies partially offsets the cost savings achieved through BYOD. Also, there are issues pertaining to the upgradation of obsolete employee devices.

In order to mitigate data security risks, enterprises are approaching telecom operators to provide solutions on mobile connectivity and data security. These include mobile device management solutions along with communication applications that allow employees to access the company’s network through an encrypted connection. As the BYOD concept gains further momentum, it is likely to offer greater business opportunities for operators.

Conclusion

With the growing telecom requirements of the enterprise segment and the need for converged telecom and IT networks, operators are well positioned to tap this market. Enterprises are increasingly outsourcing their non-core operations to them in order to reduce opex and improve operational efficiency. Operators, in turn, are focusing on gaining significant know-how of enterprises’ communication networks and mobility as well as spreading awareness about emerging telecom solutions.

In sum, several emerging opportunities are available in the enterprise segment. Operators need to expand their service offerings and overcome technical and operational challenges to fully capitalise on them. Going forward, delivering results in a time-bound and cost-efficient manner will also be crucial.

 
 

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