Managed mobile networks: A model for the future

Mobile phone networks are poised for a deluge of new services bound to add value to users and to drive revenues for network operators, a point that was made clear at the 3GSM World Congress, held in Barcelona, Spain from 13 to 16 February 2006.

Among the many new services that are already being introduced are high-speed Internet connectivity, instant messaging and push-to-talk. Now, television broadcasts using the Digital Video Broadcasting - Handheld (DVB-H) standard are on the cusp of joining the range.

With this growing bouquet of services, network infrastructure is becoming increasingly complex, while the requirement for effective management and 100% reliability remains, a fact that, says Paul McKibbin, managing director of Siemens Communications Carrier Services in southern Africa, will continue to drive the adoption of better models for network maintenance and management.

Mobile network operators are increasingly coming to the conclusion that they need to focus more attention on the acquisition and management of their customers, than to be concerned about the operations of their networks. As such, maintaining and managing a complex network is potentially an onerous and costly exercise, which may be more effectively handled by a specialist service provider," he says, adding that the network responsible for carrying services is not in itself a differentiator for a mobile operator but rather the types of services and the way these are packaged to appeal to the consumer is where the differentiator lies.

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Within this environment, the ability for operators to effectively maintain and grow market share depends on their focusing on core competencies a theme touched upon in conference keynote sessions by the CEOs of several leading network operators, who expressed the necessity to focus on core business for continued growth and success.

While the concept of outsourcing the management and maintenance of mobile networks has been successful in Europe and South America Siemens says its biggest contract for such services is held in Brazil - it has yet to fully take hold in Africa. However, McKibbin says the benefits are apparent, and expects this business to grow substantially in coming years.

"There is certainly a lot of interest from operators in SA Development Community countries. Since we can deliver skills that can match the rapidly changing pace of technology, create the economies of scale for lower costs, and reduce the need for in-house staff, the value proposition for the managed network is sound. Furthermore, as maturity is reached in the provision of cellular services, the only ways to increase profitability will be an improvement of ARPU (average revenue per user) or a reduction in operating costs. The managed services model directly addresses the latter," he explains.

"In addition, putting complex networks in the hands of those who designed them has the benefit of improved availability," he concludes.