Winning strategies for Managed Business Communication Services
Upcoming SlideShare
Loading in...5
×
 

Winning strategies for Managed Business Communication Services

on

  • 722 views

 

Statistics

Views

Total Views
722
Views on SlideShare
722
Embed Views
0

Actions

Likes
0
Downloads
16
Comments
0

0 Embeds 0

No embeds

Accessibility

Categories

Upload Details

Uploaded via as Adobe PDF

Usage Rights

© All Rights Reserved

Report content

Flagged as inappropriate Flag as inappropriate
Flag as inappropriate

Select your reason for flagging this presentation as inappropriate.

Cancel
  • Full Name Full Name Comment goes here.
    Are you sure you want to
    Your message goes here
    Processing…
Post Comment
Edit your comment

Winning strategies for Managed Business Communication Services Document Transcript

  • 1. Strategy White Paper Winning strategies for Managed Business Communication Services Enterprises are facing two simultaneous evolutions: increased mobile usage, and a gradual adoption of VoIP technologies. To address these evolutions, they are looking to service providers for Managed Business Communication Services (MBCS). Service providers can embrace the growth opportunity offered by MBCS now, by developing a set of service bundles spanning CPE- and network- based services. These bundles should be differentiated by enterprise size, and offered to the market via innovative go-to-market models with revenue sharing schemes, e.g. using traditional IP-PBX VARs as partners for installing, supporting, and maintaining CPE-based solution components..
  • 2. STRATEGY WHITE PAPER D. Buyse, D. Pierre WINNING STRATEGIES FOR MANAGED BUSINESS COMMUNICATION SERVICES Creating compelling MBCS packages that combine CPE with fixed and mobile network-based solutions are the right approach to unlock enterprise value. M anaged Business Communication Figure 1: Managed Business Communication Services within Alcatel’s overall MCS framework Services (MBCS) is one of the four categories within Alcatel’s Outtasking Outsourcing Netsourcing MCS framework (Figure 1). MBCS cov- In-house (Operations) (Ownership) (Sharing) ers all of the more telephony-related enterprise services, and their evolution Managed Customer Contact Center Managed Contact Center toward VoIP (Voice over Internet Proto- Interaction col) and mobility: fixed-mobile-SIP (Ses- Services IVR, Self-service Managed Self-service/IVR sion Initiation Protocol) voice VPN (Vir- Toll-free/premium Premium rate/ Managed Toll free - FRC tual Private Networks), managed IP-PBX Employee Unified Messaging (Private Branch Exchange), hosted IP- Interaction Unified Messaging Services PBX, virtual PBX, and fixed/mobile con- Collaboration Collaboration (audio, data, video) verged (FMC) services such as single Managed One Phone FMC phone/single number. Business FMC (phone, number) Customer Premises Communication Customer Premises or Hosted, IP Centrex The introduction of new technologies Services PBX, Centrex Managed IP-PBX SP owned IP-PBX Virtual PBX such as VoIP and Ethernet are now making F+M+SIP Voice VPN Voice VPN it possible for enterprises partly or fully to Managed outsource their communication infrastruc- Networking Ethernet Ethernet MAN & WAN- VPLS ture and operations to third-party suppliers. Services IP IP VPN They want to do this in order to overcome their key concerns in terms of Total Cost of Ownership (TCO) reduction, CAPEX/OPEX (Capital and Operational Expenditure) conversion, capacity flexibility, etc. Based on Alcatel’s experience, these enterprise needs translate In terms of enterprise service deployment, there is a natural evolu- into two main concerns (Figure 2): tion path to outsource these services: • Enterprises want to extend the reach of their communication • First, implementing managed IP-VPN and Ethernet services, gen- capabilities, from the traditional wired office toward any type erally replacing previous private data networking solutions; of environment: e.g., roaming on campus, on the move, or at • Second, migrating communication services gradually to IP-based home. This is the evolution towards mobility and nomadism. At voice services such as hosted IP PBX on top of IP VPN networks; the same time, they need to contain the costs of this growing • Finally, introducing in parallel, or in phased extension, more mobility and nomadism. advanced business interaction services. • Enterprises want to extend the richness of their communication capabilities, from traditional PBX functionalities towards VoIP. This article will investigate the key concerns of enterprises with Practical enterprise constraints steer them toward adopting a respect to MBCS; clarify how to create a rich MBCS offer that combines “smooth evolution path” to VoIP, rather than a greenfield approach. Customer Premises Equipment (CPE) and network-based applications; and show how to bundle services by enterprise segment. Finally it will The challenge for an SP when defining a compelling MBCS port- give case studies that illustrate a phased roll-out approach, using inno- folio is to address these two key enterprise concerns simultaneously. vative business models to overcome traditional go-to-market challenges. Evolution to mobility and nomadism Addressing key enterprise concerns Today’s employee is no longer desk-bound: Alcatel primary When developing a compelling MBCS portfolio, service providers research in 2004 reveals that 48% are out of the office at least one day (SPs) must be sure to address key enterprise concerns: cost and TCO a week, and 27% spend at least one quarter of their time in meetings. reduction, CAPEX minimization, risk avoidance, productivity improve- Another study from The Yankee Group in 2004 estimates that up to ment, etc. 30% of all mobile calls are made inside the home or primary workspace. 2 - Alcatel Telecommunications Review - 1 st Quarter 2006 www.alcatel.com/atr
  • 3. WINNING STRATEGIES FOR MANAGED BUSINESS COMMUNICATION SERVICES This evolution raises a fundamental question: what services do end Figure 2: Two simultaneous evolutions happening inside enterprises users really need? There is no one-fits-all answer, as illustrated by the following examples: + - mute + Caps power hold - lock Shift A S Ctrl Z D WE F B TO Zoom X G U CH Print C H Http:// V J Bmark B I N O M P .< ^$ .> ? Enter Mail / Del Shift • a traditional desk worker such as HR, finance, or back-office almost Advanced Smooth migration always uses a fixed PBX phone and/or PC for communication. Depend- Multimedia/VoIP path to VoIP ing on the industry, more advanced services like conferencing and pres- features ence-based applications may also be required; • in contrast, a traveling worker such as a sales rep, field technician, etc. Richness primarily uses his mobile phone as a communication device. While his communication richness is very limited today, most traveling workers Core communication Evolution would value core PBX communication features, such as call filtering features to mobility by a personal assistant. Additionally, enterprise telecom managers are & nomadism looking for ways to control growing mobile costs; In office Everywhere • in between, there is the campus roamer. This person is mostly on the (At desk) (Campus, road, home,…) enterprise site, yet moving freely within the enterprise campus. Hence his primary means of communication is a mobile or cordless Reach phone. Again, this category of user would value some core PBX com- munication features. Moreover, he would value an FMC (Fixed/Mobile Convergence) phone solution, enabling him to have a single phone and Creating a successful MBCS strategy single number for indoor and outdoor use. Still, this user may strongly Mixing CPE and network-based services value the richness of his IP Phone or PC communication when work- This challenge means building an MBCS portfolio that fully ing at his desk; addresses several needs: • finally, there are teleworkers and home workers. Depending on the enter- prise policy, they may use their PC, their private black phone, or their mobile • Fixed PSTN-SIP-mobile voice VPN service. It offers functionality such phone as the primary communication device. as common short numbering, tailored tariffs, mobile cost control, self-management, and incoming call routing to all users (mobile, The conclusion of these anecdotal examples is that a large enterprise PSTN and VoIP) and any type of terminal. consists of very different user profiles, with different usage patterns in • Virtual PBX service. It delivers core PBX functionalities such as call terms of communication means and preferred terminals. The challenge transfer, hold, park, forwarding, hunting, three-way conferencing, for an SP is to acknowledge these differences in user profiles, while still and forward to attendant, to any fixed (PSTN or VoIP) and mobile delivering a seamless user experience. user, either stand-alone or at a site not requiring a PBX. This vir- tual PBX service is available to mobile and fixed terminal users. As Smooth migration path to VoIP such, it mainly targets traveling workers, campus roamers, tele- For years, enterprises have been hearing the promises of VoIP, which workers, and some users in small branch offices who do not require today finally seem to be materializing. An Accenture study has found that more advanced features. by moving to VoIP, enterprise TCO can be reduced by 10-30%. Moreover, • A common attendant/secretary service. Most enterprises value a con- employee productivity can be improved by up to 15% via advanced, pres- sistent attendant/assistant service (attendant overflow, dynamic ence-based Unified Messaging (UM) and multimedia services. Therefore, routing, announcements, music) across all fixed and mobile user according to a 2004 Yankee Group study, over 40% of European enter- categories. prises with more than 500 employees are considering a roll-out of VoIP. • Managed or hosted IP PBX. This service delivers all the benefits of However, the same study revealed that the main barriers for full-scale VoIP (lower phone bills, advanced communication features such adoption of VoIP are existing, traditional PBX contracts. Typically, these as presence, and UM) to wireline enterprise users, predominantly PBXs are depreciated over a seven-year period, and within a given enter- for their desktop office phone. Whether enterprises prefer a man- prise, not all PBXs were purchased at the same time. Hence, a hybrid sit- aged or hosted IP PBX depends on the enterprise context. uation between traditional PBX and IP-PBX sites will exist for a long time • Fixed/mobile converged single phone/single number service. It offers the within most enterprises. Unsurprisingly then, a 2004 UBS Warburg study user the convenience of a single terminal (including personalized found that 50% of U.S. and European CIOs of large enterprises consider address books, for example) together with the benefits of fixed com- the evolution path to VoIP not smooth enough. munication (coverage, pricing) wherever possible. This service As a result of this hybrid situation, enterprises will be confronted with mainly targets traveling workers and campus roamers. Alcatel can the following questions over the next few years: equip SPs to deliver this MBCS portfolio via just two solution com- ponents (Figure 3): • how can we provide a seamless user experience, e.g. a short number- • The OmniPCX family. This full-fledged PBX and IP-PBX exists in ing plan between sites, without constant PBX reprogramming? enterprise (OmniPCX Enterprise) and SMB (OmniPCX Office) ver- • how can we obtain detailed call log analysis and departmental cost sions. OmniPCX has a rich feature set (e.g. VoIP, Voice over WLAN, reporting across all sites? IP phones, softphones, attendant console, dial-by-name, etc.) and • how can we be sufficiently flexible to adopt innovative services like pres- is available in managed and hosted modes. ence-based communication without massive upfront investment? • The Corporate Mobility Manager (CMM). This network-based application resides on an application server (Open Services Platform [OSP]) that The challenge for an SP is to acknowledge the hybrid enterprise environ- can span fixed PSTN, fixed SIP, and mobile networks. The CMM solu- ment in terms of large sites, medium sites, branch offices, teleworkers, and tion component allows service providers to offer PSTN-SIP-mobile voice mobile workers, while still delivering a smooth evolution path to VoIP to unlock VPN services, virtual PBX services (including common attendant), and the potential of new applications such as presence. FMC single phone/single number services. www.alcatel.com/atr 1 st Quarter 2006 - Alcatel Telecommunications Review - 3
  • 4. WINNING STRATEGIES FOR MANAGED BUSINESS COMMUNICATION SERVICES Differentiated service Figure 3: Rich MBCS portfolio to address enterprise needs bundling by enterprise segment Hosted/managed SOHO market • Full IP-PBX feature set • Local ICT integration SOHO companies have less than five PSTN-SIP-Mobile Virtual PBX employees; ICT (Information and Commu- Voice VPN • Core PBX feature set • Common numbering • Consistent fixed-mobile nication Technology) is not typically con- • Tariff & cost control • Consistent PSTN-SIP sidered a core competence, while mobile • Common (self)-mgmt • Common attendant • Common call routing Multimedia (IP-) phone usage may be significant. Therefore, PBX features they would value the following MBCS service bundle: Core (IP-) PBX Attendant Core (IP-) PBX features features features • FMC single phone/single number serv- ice combined with virtual PBX fea- tures to address the need of high mobile Mobile (2G, 2.5G, 3G) use, both on the move and in the small PSTN & VoIP (SIP/H323) office; • Additionally, some traditional fixed- line phones inside the office or home FMC • Single phone IP-PBX IP-PBX may be connected to the virtual PBX Gateway Gateway • Single number (e.g., over an xDSL line) and its atten- On the move Teleworkers Branch offices Main offices dant features. Typically these users are not interested in advanced VoIP/multi- media features. Figure 4: Innovative business model with NA RBOC Small and Medium Businesses (SMB) The typical SMB has less than 100 employees, mostly located on a single site. 1. SMB subscribes to Telco service: Telco Depending on the industry (e.g., consult- Voice, Internet connectivity, business ing), mobile use may be important. The communication, Internet services 1 4 SMB market is not particularly ICT-liter- 2 2. Telco bills SMB monthly (flat fee for the enterprise) ate, and prefers pre-packaged solutions. These solutions may even cover teleph- 3. Alcatel and channels perform CPE Services (OmniPCX) ony, IT, and mobile at the same time. Such 1. Channels: installation maintenance SMBs 2. Alcatel: remote management, customer support companies would value the following MBCS service bundle: 4. Telco buys from Alcatel 3.1 1. OmniPCX Office (traditional equipment sales) 5 2. Marketing, pre-sales support (part of Alcatel Telco contract) • FMC single phone/single number serv- 3. Installation, maintenance, management, customer support. Channels 3.2 ice combined with virtual PBX fea- Yearly fees per SMB tures to address the need of high mobile 5. Alcatel pays channels for installation, maintenance use, both on the move and in the small office. A fixed/mobile voice VPN may be attractive, as intra-company calls are important; • a need to explicitly address international communication needs; • For the main site, a managed/hosted IP-PBX is the right answer. • potentially, a large number of branch offices (e.g., banks), which The IP-PBX solution may very well include a fully managed IT solu- may be addressed with several hosted IP-PBXs (tunneling tion (e.g., including Web server, security, file/print server, etc.). To through IP-VPN) or with virtual PBX features; meet this need, Alcatel proposes a full ICT bundle (Alcatel • the potential to outsource fully all communication needs to a sin- OmniPCX Office plus Alcatel Eye-Box, cf article by D. Pierre and gle provider (even non-telco). G. Gauthier); • Finally, some tele-workers/home workers or an occasional branch Adopting innovative go-to-market models office may also exist. These users may be tunneled toward the IP- The challenge for an SP is to deliver these service bundles, PBX or to the virtual PBX over a PSTN Voice VPN. which span network-based applications and CPE-based solutions. For the latter, on-site installation, maintenance and operations are Mid-market often required, for which a telco service provider may not be These are typically enterprises with over 100 employees. Com- equipped. In contrast, traditional IP-PBX sales channels often lack pared to the previous segment, the main difference lies in the fact the competence and assets to remotely manage IP-PBXs and to that nearly all of these enterprises are multi-site. Therefore, the Ser- deliver network-based applications. vice Provider’s offer should also include PSTN-SIP voice to allow for To overcome these hurdles, Alcatel facilitates a partnering seamless migration to VoIP, site by site. scheme between SPs and channel partners. In this partnering scheme, the natural strengths of both players are combined. This Large enterprises (LE) partnering scheme is supported by a proven business model as illus- Compared to the previous segment, the main differences are: trated below. 4 - Alcatel Telecommunications Review - 1 st Quarter 2006 www.alcatel.com/atr
  • 5. WINNING STRATEGIES FOR MANAGED BUSINESS COMMUNICATION SERVICES Case study: North American RBOC Figure 5: Innovative business model with LATAM ILEC targeting SMBs with MBCS Under the partnering scheme, this telco is the “owner” of the enterprise, and 1. Large enterprise subscribes to Telco service: sells a solution that is co-branded Telco- IP-VPN, business communication (IP telephony, applications) Telco Alcatel. The Telco’s MCS offering to SMBs 2. Telco bills enterprise monthly per user for business communication. 1 4 includes: 3. Channels perform installation and maintenance of necessary 2 • OmniPCX Office as voice, data, and CPEs on behalf of Telco MCS. Large Internet CPE; 4. Telco buys from Alcatel (+ partners) NGN, Enterprises 6 + partners • Voice connectivity and traffic; OmniPCX solutions as a service. Monthly fees per user • Internet connectivity and associated of business communication 3 network services (Web, e-mail, etc.). 5. Alcatel uses its channels to offer local service 5 to the end customer Channels The telco is a one-stop-shop for the 6. Telco pays channel for installation, maintenance, and local enterprise in terms of sales & monthly services to the end customer billing. However, installation, manage- ment, maintenance, and customer support for OmniPCX Office at the customer prem- ises is done by Alcatel and its partners on behalf of the telco. The details of the part- Figure 6: MBCS market is taking off nering scheme are described in Figure 4. Index relative to May status) In terms of business model, a detailed revenue-sharing scheme has been crafted, 4,0 where each of the actors receives a fair 3,5 share of the revenue stream, in line with Monthly growth rate: 35% their activities and assumed risks. 3,0 2,5 Case study: Latin American (LATAM) ILEC targeting Large Enterprises (LE) 2,0 with MBCS 1,5 This telco is an experience IP VPN provider addressing LE in LATAM. To Program 1,0 Launch increase their revenue streams, they 0,5 launched an MBCS offer over IP-VPN, consisting of managed and hosted 0,0 OmniPCX Enterprise solutions. Again, Q1 2005 May Jun Jul Aug Sep the telco is the “owner” of the offer, and sells an overall “Telco MCS bun- dle” to the enterprise. The telco has outsourced the NGN infra- • Adopt a phased service roll-out approach depending on their structure and OmniPCX Enterprise equipment to Alcatel and market position, e.g. starting with hosted IP-PBX, enriching with its partners, and they share responsibility in terms of financ- Voice VPN, and then adding Fixed/Mobile Convergence; ing and operations. In return, the telco pays a recurrent fee to • Build innovative go-to-market models with revenue-sharing Alcatel and its partners on a per-month, per-user basis. CPE schemes, e.g. using traditional IP-PBX VARs as partners for installation and maintenance is done by Alcatel’s channel installing, supporting, and maintaining CPE-based solution partners, on behalf of “Telco MCS”. The detailed roles and components. responsibilities are described in Figure 5. Conclusion In Q1 2005, Alcatel started to approach service providers with this Dominique Buyse is Dominique Pierre is a Director of Strategic Strategy Director for MBCS strategy, which bundles CPE-based and network-based appli- Marketing for Alcatel’s SMBs, in the Alcatel cations together. As Figure 6 illustrates, since then the number of Fixed Solutions Division. Communications SPs with whom Alcatel is engaging in Europe has been growing at over He identifies and Servers Business Unit 30% per month. This clearly confirms the relevance of the identified analyses emerging operator (CSBU), Enterprise Solutions MBCS market opportunity for SPs. From the enterprise side, signif- strategies and business Division, Strasbourg, France. icant interest has been observed, ranging from explicit requests from opportunities, in order to steer (Dominique.Pierre@alcatel.fr) large enterprises to SP, to enthusiasm from SMBs when approached Alcatel’s positioning and solution by the service provider with, for example, a hosted ICT bundle. development. He is based in Alcatel recommends that all SPs actively investigate their MBCS Antwerp, Belgium. strategy in order to: (dominique.buyse@alcatel.be) • Develop a set of service bundles spanning CPE- and network-based services, ideally differentiated by enterprise size; www.alcatel.com/atr 1 st Quarter 2006 - Alcatel Telecommunications Review - 5
  • 6. WINNING STRATEGIES FOR MANAGED BUSINESS COMMUNICATION SERVICES Glossary XX XXX 6 - Alcatel Telecommunications Review - 1 st Quarter 2006 www.alcatel.com/atr
  • 7. Alcatel and the Alcatel logo are registered trademarks of Alcatel. All other trademarks are the property of their respective owners. Alcatel assumes no responsibility for the accuracy of the information presented, which is subject to change without notice. © 03 2005 Alcatel. All rights reserved. 3GQ 10001 0024 TQZZA Ed.01 02 2006 00014 0016