Basing a strategy on advanced services for businesses will fail unless operators can offer service that rivals their IT counterparts. Andrew Wyatt, vice president of strategic marketing, Intuwave, says mobile SLAs are an opportunity.
Businesses want to use Smartphones for more than just voice and text — and mobile operators encourage them to do so in order to increase the average revenue per user (ARPU). However, the service tools taken for granted in the PC world — and the service level agreements they enable — are not being used in the mobile world. Without them, the case for corporate use of Smartphones looks weak. With them, intriguing possibilities emerge.
Smartphones promise to revolutionise the use of mobile devices — and businesses are ready for it. Independent research commissioned by Intuwave revealed that 52% of corporate IT managers would consider deploying Smartphones as business tools. It also found that these devices are already being put to business purposes — 44% of Smartphone users, for example, are using them for email.
Business use is critical
However, business use of Smartphones implies access to business-critical applications and they must therefore be supported as such. The ‘fire and forget’ mentality that typifies operators’ current approach to service — where an SMS is despatched to the user’s malfunctioning handset and the Customer Service Representative (CSR) drops off the call before the fix is proven — is inadequate for the needs of businesses. Until this approach changes, there is very little incentive for the corporate market to deploy Smartphones because they simply can’t be relied upon as business devices.
Business customers are used to SLAs whereby problems are diagnosed and fixed within a set period of time and in a single transaction. They are a central part of the relationship with any vendor that has an influence over the performance of its business-critical applications — and mobile operators will be no different. However, the sophisticated support tools available in the PC world to provide remote diagnosis, configuration and support are simply not being used in the mobile arena. Not only are investments in this technology therefore necessary to support business users, but the escalating costs of Smartphone support makes them inevitable.
Support calls for Smartphones are much longer than those for more basic mobile phones — typically around 30 minutes. At a cost of around £2 per minute for support calls and using Ovum’s estimate of 150 million Smartphones in existence by 2007, this will rapidly become a multi-billion dollar problem. Operators must invest in support capabilities and the costs of doing so are insignificant in relation to the scale of the problem they aim to solve.
High ARPUs, high support
In addition, keeping business customers satisfied is critical in saturated markets where customer acquisition costs are high. Corporates have the highest ARPU of any class of customers, generating approximately half of an operator’s revenues while making up a much smaller percentage of their user base.
Providing business users with Smartphones capable of supporting corporate applications and backed up by meaningful SLAs allows operators to engage with their business customers in a more professional manner and is an excellent way of ensuring their loyalty. A happy customer with a strong relationship to a dedicated support team is likely to be much more willing to be shown new services and be up-sold additional services.
However, given the high costs involved, this level of support need not be provided to all customers. Operators should segment their customer base and align their support teams to these segmentations to ensure that high value data customers are treated differently to low value ‘pay as you go’ users.
SLA-based service capabilities may also completely redefine an operator’s value proposition. It is clearly in the interests of operators to encourage the development of third party applications: however, there is today no mechanism in place to support such software so, if anything goes wrong with the application, the operator picks up the support call and the expense. With the correct service infrastructure, SLAs could be applied not only to the software shipped with the phone but to third party applications as well. Operators could then develop a list of certified applications and extend their support environment out to both the application provider and the enterprise.
Support costs might be recouped in different ways. Perhaps the most likely is that operators could provide the necessary support tools to the corporate IT department enabling them to support themselves. In this scenario, operators would provide a personal hosted system for each business customer, thus if the corporate left that particular operator they would lose the support tool and supporting infrastructure: what better way to create corporate loyalty than to provide this level of interdependence?
No entry point for IT
This is an area where traditional enterprise IT vendors are colliding with the telecommunications world: the IT world has no knowledge of — and no access to — the provisioning systems which are the only real support tools that operators have today. Consequently, it may well be that it is only mobile operators that are in a position to offer the SLAs that businesses will require for enterprise systems deployed across wireless networks, and in turn this will provide the customer loyalty that operators seek.
Operators need corporate customers to make greater use of Smartphones in order to drive the revenues necessary to recoup 3G investments. This means facilitating the introduction into the business community of Smartphone-based applications — whether on a stand alone basis or in partnership with software vendors and/or systems integrators. Being able to provide meaningful SLAs governing the support of both the devices and the applications running on them is the best place from which to start.