A Democratic Approach to coping with the mobile data explosion

July 28, 2010 - Openet

The introduction of new devices such as the iPhone 4 will likely lead to huge strain on already under pressure networks. In addressing this issue some operators are now abandoning all-you-can-eat data tariffs and opting for data caps. Are there any other more user and operator friendly solutions? Mike Manzo, CMO of Openet, believes that there is.

The demand for mobile access to data has surged, particularly as video on demand, cloud computing and the plethora of newly launched mobile devices becomes every-day consumer and business must-haves. This has resulted in operators and consumers battling with inevitable network congestion. In response, operators have addressed this challenge by offering premium packages to end users that increase network speed and prioritise their traffic. Consumers are starting to rally against the inevitable resulting pricing hierarchy. Operators are therefore not only reassessing their business models, but their entire approach and definition of ‘paid for’ and ‘free’ services and content. One of the largest market shifts in the next 12 months will be smart operators embracing over the top content applications and devices, rather than viewing them as a threat to their businesses. This shift in approach requires an expansion of what is meant by ‘network resource’, as well as flexibility in allocating, rating and paying for it. In every case, this requires real-time control of both resources and payment, including the ability to selectively allocate resources when they are scarce. There are many examples, scattered across the telecoms market, of operators waking up to this paradigm shift. The eventual embrace of Skype by many global operators, for some a complete u-turn on strategy, is a wide-spread example of how forward thinkers are moving towards a telco 2.0 world.
Network constraints

Networks have much potential in delivering personalised, on-demand content, such as video. The ‘network resource’ is not vanilla bandwidth, but QoS; this includes management of such variables as packet forwarding prioritisation, maximum and minimum bit rate and RF spreading factor. Poor quality would result in audience abandonment and the failure of the model, closing the doors to what is expected to become a key revenue generator. From a business services perspective, the emerging trend to move data into the cloud has pushed network constraints. Mobile carriers have to deliver always-on performance as enterprises are accessing critical information _ such as data storage, email and web-based document management and collaboration. Any congestion that precludes access will have huge implications on the business and its relationship with the carrier.
Effective resource allocation

If a network access point is busy servicing customers using devices such as the iPad; delivering on-demand video as part of an agreement and supporting access to enterprise services, it may be in the best interests of both the operator and the subscriber to enable ad-hoc access to alternative networks for basic data connectivity service. By doing so, they can sell basic connectivity to anyone most of the time, but can selectively allocate resources when demand exceeds supply. One implication of this is a business model in which some specific services (such as banking, video viewing, email access, etc.) are provided with access built in. For these services, access is an intrinsic feature with an associated SLA. Services without built in access (such as general web browsing), are accessed ad hoc through the network that has the best connectivity in a given circumstance.
Flexible business models

Over and above short term ‘coping’ strategies, smart operators are feeling the heat to plan strategically for the long term exponential expansion of network stress. Using proven methods to open operator airwaves on an ad-hoc basis provides the flexibility for subscribers, as well as operators, to enable the implementation of innovative business models. This continued adaptation to consumer behaviour and evolution of operator business models is the key to continued performance, relevance and ultimately, profit. Such a strategy opens up a wealth of options regarding when and how network resources are available. This flexibility and control may be the key to ensuring the QoS and availability guarantees inherent in many next generation business models.

For operators, the elephant in the room is how they retain control and monetise the usage of such shared networks and value-added service delivery capabilities. In some cases the end user bears the brunt; however, there is an opportunity to create a premium partnership with OTT players in exchange for revenue share. We at Openet call the capability to support this as ‘Partner Service Controls’. Such infrastructure enables operators to establish revenue-generating partnerships in which third-party providers of content, applications, services and devices subsidise access to ensure an enhanced end-user experience whenever subscribers access their applications, content, or services. 2.0 operators generate new revenue streams, improve end user experience and play a more strategic role in the telecoms environment.


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