Looking ahead to 2013? Tips to Help Enterprises Stay Ahead of the Evolving Communications Landscape

Featured blog by Ken Lienemann, SVP, Tangoe, Inc.

With 2013 around the corner, trimming costs while enhancing efficiency and productivity is top of mind for organizations. Enterprise communications is a critical place to start, as this landscape has evolved extensively and exponentially over the years, not to mention telecom consistently falls within the top three largest expenses. Whether it’s deciding to adopt the BYOD phenomenon or assessing your relationship with telecom service providers, the following predictions provide a helpful roadmap, and give you a head start in 2013:

1. BYOD Becomes “Bring another Device” (BAND) – While BYOD is making the headlines; few companies will adopt a 100 percent BYOD environment because corporate liable (CL) will remain the most cost effective and secure means for enterprises to manage mobility. Instead, BYOD will primarily serve as “Bring another Device” (BAND) for employees who want to access corporate email and applications on their personal tablets, second, or third devices. Carriers are offering hybrid BYOD pricing for employees, which is actually more cost effective as a bolt-on to the corporate contract to encourage enterprises to drive BYOD traffic to their networks.

2. 1-800-DATA fills the Flat-Fee Void – The mobility market continues to evolve and so too will the relationships among the players within this quickly changing ecosystem. To capitalize on revenue opportunities, content providers and carriers will join forces to deliver differentiated offerings. In other words, we’ll see “toll free data.” For example, we could see a hot Google handset based on Motorola and an exclusive data plan with say, AT&T, in which Google content (YouTube, Maps, etc.) that is downloaded does not count against one’s data plan.  Another example may include enterprises that adopt Verizon’s cloud services; making access to the enterprise cloud services from Verizon mobile devices free of charge.

3. Microsoft Takes Back Crown as King of the Mobile OS in the Enterprise – Following the same path as Apple when the iPhone entered the market, Microsoft will wrangle its way to the top as the leading mobile operating system in the enterprise. Let’s take a quick walk down memory lane. While the iPhone is increasingly ubiquitous in the enterprise today, there was a time when it was unheard of to call it anything but a consumer device. Apple created a unique mobile operating system, but it wasn’t adopted in the enterprise until it deployed basic security to IT and mobile device management vendors via APIs. Microsoft is currently in a similar situation. Consumer-based apps for iOS and Android will continue to flow, but the enterprise apps people are using aren’t on those devices. With Windows 8, we’ll start to see Facebook-like features and social media collaboration within a Windows back office container. Next up, they’ll open up those APIs.

4. Machine to Machine (M2M) Connections Jump – M2M will increase as companies look to have their devices communicate more effectively, drive efficiency and cost reductions through predictive diagnostics, harvest valuable real-time data for process improvement and innovation. An increase in M2M will also lead to an increased demand from companies looking for ways to securely manage these devices while managing the unpredictable expense associated with connectivity. M2M will need to be secured, monitored in real-time, and be easily updated for new applications.

5. Wireless Telecom Services Convert to Data over LTE – Today, carriers are requiring a minimum voice plan to get a data plan. Over time, as companies integrate with voice over Wi-Fi, pure cellular minutes and voice over data solutions will emerge as viable solutions. This change aligns with the pricing shifts we are seeing from carriers to make plan models more data-centric. Along with being much more efficient, this will allow CDMA carriers to finally deliver simultaneous voice and data connections.

6. Data Roaming Costs Plummet Thanks to Wi-Fi Network Collaboration – International roaming fees can be crippling to a telecom budget that is already, on average, the enterprise’s third largest expense. As businesses experience international growth, the cost of staying connected becomes even greater. To meet this trend head on, Wi-Fi networks across the globe will partner to deliver enough coverage to provide a credible data roaming solution for many enterprise users.

7. Carriers Push Enterprise-grade Pooled Text and Data Plans – Many of the major carriers made noise this summer by unrolling their own versions of shared data plans for consumers. There was much speculation over whether this model would work within an enterprise setting, but whichever your perspective, we are seeing a huge demand. As BYOD grows and more enterprise users are equipped with multiple devices (i.e. tablets and smartphones), we will see carriers delivering plans catered to this environment. Though anxious to take advantage of this offering, enterprises will also need to learn how to best allocate the cost of the data pool effectively.

8. Demand for 4G Spikes as Carriers “Pull Back” Key Services – Initially the carriers were attempting to influence enterprise clients’ behavior through manipulation of pricing, making “legacy technologies”like frame relay more expensive in order to incent migration to MPLS. But more recently, the carriers have been putting language in their agreements that would allow them to discontinue these legacy services. The FCC still has to weigh in on this tactic, and they are entertaining a petition from VzB currently, but any time an agreement is “opened for negotiations” the providers are going to be looking to insert language to sunset these services or, at the very least, increase their legacy prices. The current list of services targeted includes frame relay, private line services that are low speed (below T1.5) and access below T1.5. Tangoe predicts that the list will expand to include higher speed private line services, dial up services, and IP VPN services, which will lead to a shift in the demand for alternative services such as 4G wireless.

9. Cost of MPLS Services Skyrocket for Enterprises – 90 percent of enterprise clients buying MPLS services from AT&T, VzB, or Sprint will risk having their costs for WAN services increase by as much as 17 percent without any contractual or service changes. By now most people are familiar with the onerous Universal Service Fund (USF) fees that have been as high as 17.9 percent and are currently assessed at 17.4 percent. You may even understand that the providers are allowed to pass these charges through, but not required to do so. At this time, AT&T, VzB, and Sprint are all assessed for USF on MPLS services. In other words, they pay the fee based on their MPLS revenues. None of them are currently passing these costs on to enterprise clients. That could change tomorrow, however, and the migration from TDM services to SIP services will translate to the providers collecting less revenue for USF from enterprise clients. It is just a matter of time before one of the major carriers makes the move to assess MPLS services and the others will quickly follow. All provider agreements contain language allowing them to make adjustments such as the inclusion of MPLS assessments at any time. Tangoe feels the time for changes in MPLS assessment is drawing near.

10. Global Adoption of BYOD – As new technologies emerge to protect corporate data without violating data privacy standards for personal information, especially throughout Europe, adoption of BYOD programs will increase dramatically forcing multinational corporations to extend these programs abroad.

With these predictions in mind you can head into 2013 with confidence that your organization will run more effectively than in 2012. Like any major company initiative, it’s critical to have an enterprise communications plan in place to avoid the costly yet inevitable “bill shock”.