The Changing Role of Mobile Operators, snap by Beecham Research

Beecham Research’s Snap#38:

A closed roundtable event without audience or press was held by Ericsson during the CTIA show in Orlando, Florida, in March, chaired by Beecham Research. The purpose was to provide a forum where M2M industry experts could share their views about some key topics in a way that would allow a deeper analysis than is usually possible in a public panel session.

The discussion covered two key topics. The first examined the role of Mobile Operators in the ongoing development of the M2M market. Do they have a role? If so, what is it? Is it a passive role or an active one? The second topic was linked to this – the desirability of openness in the M2M market and the MNO role – if any – in extending this.

1. The figures used to show how the M2M market is growing and its future potential are often misleading and vary in the applications and content they refer to. A common definition would be helpful. It was agreed that M2M should refer to the use of devices where voice is either not included or is a secondary component. In other words, where it is an add-on that strengthens the primary application, which is always a data application.

2. Should devices like tablets be included or not? Although GSMA includes these in its definition of Embedded Mobile as part of an expanded definition, it was agreed that they are generally not included in M2M. It was also agreed that there will always be grey areas in the definition and that this may need to vary over time as technology moves forward and differences blur.

3. Mobile operators have a role in making M2M easier to set up and use. If operators are doing their job right, they should be invisible to the user, but not of course to the business partners they are creating the solutions with. It is at this level – the B2B element of B2B2B and B2B2C – where the role of the mobile operator should increase. The MNO’s job is seen as making it as simple as possible for the application service providers to bring new M2M services into the market in any sector – healthcare, telematics, smart metering, etc. MNOs need to put in place the right infrastructure to reduce costs and automate related activities as much as possible to get them to market quickly.

4. Mobile operators also have a role in making M2M solutions reliable. Some of the developing application areas such as eHealth or telematics can be life or business critical. Meanwhile, consumer devices may have an impact on the networks. Because MNOs are in a position to know the risks associated with these types of connections, they can help to manage these issues.

5. Mobile operators are becoming an integral part of their customers’ products in a way they have never been before, providing more than connectivity. Customers are now depending — for market strength — on new ranges of products where MNO services are an integral part of the offering and reliability is of key importance. That is a very different role for operators that formerly delivered only infrastructure.

6. Mobile operators should be involved earlier in the solution design process. Application designers tend to think of the communication requirement last. As a result, MNOs tend to get involved late in the process and can make limited contributions as a result. Bringing them in earlier would allow them to make a more valuable contribution to the overall design and help the project reach its objectives.

7. Current discussions in the market include embedded SIM – specifically the prospect of being able to change operators over the air. Some MNOs consider this a threat, changing market dynamics. What is the role of the MNO if the subscription is completely portable? On the other hand, some argued that the SIM is always portable; today you can change a SIM card.

8. M2M solutions have been “bottom up” — based on operational rather than strategic needs. This is changing and M2M is being transformed into a business value proposition, as for example where the business value of a solution in one sector is recognized as being relevant for another. MNOs have a role in extending this evangelizing. This process is seen as helping to accelerate the development of the M2M market.

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