 |
|
|
Selling Enterprise Mobility In a Crowded European Environment, Better Find Your Spot!| May 5, 2008 | Enterprise Mobility - Europe | Advisory Report
SummaryThe European market is getting more competitive as more players are entering the battlefield to offer enterprise mobility services to multinational companies (MNCs). In particular as new network technologies are being deployed, large European mobile and fixed operators are positioning themselves to capture a large market share of the ‘hot’ mobility services market. The reason for this is that a larger number of large companies are embracing mobility to increase employee productivity and improve customer responsiveness. To win in this market the European mobility players need to position their value propositions in very clever way by differentiating their offerings based on their core strengths and market understanding to create their own ‘Blue Ocean Strategy’. Hence, this advisory report will primarily highlight who the main European enterprise mobility players that are battling for market share and taking leading positions to serve MNCs. It also addresses the overall market dynamics that are taking place to serve these enterprises with mobility solutions. Current Analysis PerspectiveAny observer of the enterprise market for either mobile or fixed services has seen that the players in these two formerly distinct markets are increasingly competing against each other. This picture has changed substantially over the last three years. While in the past there was no real competition, today both camps are fighting for the same business. Why is this? One reason is that the technology of fixed-mobile convergence (FMC) has allowed more players into the game. Another reason is these players realize that large MNCs need both fixed and mobile services, and as a result both mobile operators such as Vodafone, O2 and KPN and fixed operators such as BT Global Services, COLT and Cable & Wireless have the opportunity to offer enterprises mobility solutions. Moreover, there has also been an increase in virtual players such as Vanco. Since mid-2003 there have been different initiatives among mobile operators to strengthen their market position against key mobile rivals and fixed operators. Who are the main European mobile players that have made major or minor market initiatives? Here are some competitor snapshots of the main European players including our current perspectives: FreeMove Alliance The FreeMove alliance was originally announced in mid-2003. The FreeMove Alliance is a legally incorporated entity, consisting of the Orange Group, TIM, T-Mobile International and TeliaSonera, targeting large-to-MNC corporate accounts within the shared footprint. Telefonica Moviles was part of the alliance, but the Spanish incumbent was forced to leave the alliance in order to meet EC conditions for its 2006 acquisition of O2 assets in Europe. In addition, Amena joined the FreeMove Alliance to fill in for the exit of Telefonica. FreeMove’s key marketing proposition is its ability to provision single, dedicated account management, consolidated billing and pan-European services to the multinational community. Currently, FreeMove provides coverage in over 21 countries within its members’ aggregated network footprint, and a further seven countries through partnerships. FreeMove’s sales and marketing strategy is heavily influenced by its alliance structure, which is both a strength and a weakness. Current Perspective: We are at this stage taking a neutral view because FreeMove is potentially a powerful MNC-oriented service provider if it makes full use of all its available resources. Moreover, FreeMove is an exercise in competitive pragmatism, originally born from the partners’ common need to unite against a mutual enemy: Vodafone. Having Orange Business Services as a partner means the organisation is in a stronger position than many other rivals. However, by leaving FreeMove fairly stagnant, the alliance risks losing further ground due to internal competition and to a more proactive Vodafone Global Enterprise. Vodafone Global Enterprise Vodafone Global Enterprise (VGE) was established in April 2005 to take care of Vodafone’s MNC business services, and this unit now has 350 people within global teams in 20 countries managing the mobile communications for its top MNC customers worldwide. Through its wholly-owned subsidiaries, affiliates, joint ventures and partner networks, Vodafone can offer network coverage across 65 countries worldwide. VGE has clear criteria to qualify a global account; it initially managed 68 named accounts and this has grown to 142 accounts at the end of Q1 2008. A top priority for VGE is moving to expand its global portfolio into the realm of managed services and even outsourcing contractual agreements. It is starting with Vodafone Secure Remote Access (currently available in the UK and France) and Vodafone Application Service (available in Australia, the Czech Republic, Germany, Egypt, Spain, Hungary, Romania, France, Turkey and the UK). Current Perspective: We are taking a slightly positive stance because VGE with its single management and P&L structure is demonstrating that it has more power at the group level to drive global commercial offerings to multinationals. However, VGE is no exception to many other mobile operators insofar as it has also been challenged to deliver a single global contract for certain customers. While this is a work in progress there is still more work to be done to be able to offer integrated services based on, for example, standard SLAs. Sympac KPN is offering international mobile services for European multinationals via its subsidiary Sympac, providing Europe-wide services under one contract, one contact and one bill. Since its inception in 2005, Sympac has done fairly well to expand outside KPN’s core footprint to six country markets through partnerships from different providers, aligning the services as much as possible, and has offerings such as its mobile fleet-management solution and ‘PBX Anywhere’ offering, supported by financial and SLA reports through its Web services tool. In addition, in February this year Sympac joined forces with Ezwim, a software-as-a-service provider, to introduce a new telecom expense management service that gives MNCs insight into their costs and enables them to take increased control of their telecom spending. Current Perspective: We are taking a slightly positive stance because although Sympac is a relatively new and low-profile brand in the multinational community, and it will take some more time for this new unit to really gain traction in the highly conservative mobile sector, although the company is showing some traction selling its solutions. The company can highlight its strong management platform with service level reporting, financial reporting and fleet reporting. Through its acquisition of IT services provider Getronics in 2007, KPN Mobile's Sympac division should consider offering mobile application services outside of its core markets, which it should do in order to compete more effectively with its larger rivals. O2 O2 is a wholly-owned subsidiary of the Spanish Telefónica Group, and is comprised of mobile network operators in the UK and Ireland, along with integrated fixed/mobile businesses in Germany, the Czech Republic (Telefónica O2 Czech Republic) and the Isle of Man (Manx Telecom). O2 UK is the group’s largest business. The O2 Group deploys a classic business segmentation model, with five specific market segments – prepaid (youth), post-paid consumer, wholesale, SMB (one to five employees), SME (less than 200 employees) and corporate (greater than 200 employees), as well as a traditional vertical market segmentation: manufacturing; retail; media; leisure; travel, transport and distribution; IT and telecoms; finance; utilities; services; professional services and consultancy and the public sector. Current Perspective: We are taking a neutral stance overall because O2 is in essence best placed in the UK where it has launched several initiatives such as a consultative selling approach in partnership with professional service providers, and recently introduced a mobile application development center for partners. However, to improve its standing in Europe these enterprise mobility initiatives need to be exported into other European markets. For example in Germany the company has not been well positioned to compete, but in Spain, where the parent company originates, the O2 group is well positioned via Movistar.
After having highlighted some brief competitive assessments of the large mobile operators in Europe; the next step in assessing the competitor landscape is to look at which key European service providers coming from the fixed network environment (also in some cases sister companies of the mobile operators) are targeting the enterprise mobility space either in minor or major degree. Orange Business Services Orange Business Services targets global enterprises and regional businesses with integrated fixed and mobile services. Orange Business Services’ fixed-line data network extends to 220 countries and territories. On the wireless side, Orange’s mobile networks serve users in 17 countries, and Orange Business Services’ mobile reach is further boosted by its relations with partners FreeMove. In addition, Amena in Spain joined the FreeMove Alliance in 2006 after it was acquired by France Telecom, which gives FT’s Orange a stronger position in the alliance. Orange Business Services addresses the MNC segment by putting a Global Account Manager (GAM) at the helm of account engagement, with national sales, national operations, bid-management team, global support team and procurement functions working as a virtual team under the GAM. Current Perspective: We are taking a slightly positive stance, because Orange Business Services is very well positioned in the European market to serve MNCs and is increasingly offering new services. Moreover, Orange Business Services’ mobile reach is further boosted (although still needs to deliver commercially) by its relations with partners FreeMove and AT&T (Cingular) to support roaming across Europe and the US. However, the big caveat is that many of its more innovative packages, such as Orange Open Office, are country specific and are not available on a pan-European basis. BT Global Services BT Global Services (BT GS) employs around 30,000 people and is focused on delivering managed “IT networked services” to multi-site large enterprise customers in the UK and internationally. It means selling integrated IT, fixed and mobile enterprise business services. BT GS IP network reaches over 130 countries, and BT GS expects to increase this to 170 countries. The company’s enterprise mobility value proposition contains a managed mobility offering, WLAN, RAS and conferencing elements. Because BT GS does not own its own wireless network it will partner and has set up a VMNO business to better serve its customers. BT GS announced a global portfolio of unified communications and collaboration services, as part of its 21CN, aimed at securely linking voice, mobile and data services with the desktop. Current Perspective: We are taking a mixed stance between neutral to slightly positive because while BT Global Services is a strong European enterprise player because of its global reach and local presence in key European markets, it needs to work on its enterprise mobility portfolio to become a frontrunner. However, while BT GS has no wholly-owned wireless infrastructure the company should have every opportunity to gain a better position via its defined enterprise FMC strategy and has concrete development plans to expand the global capabilities of BT Corporate Fusion to support large enterprises and multinationals both within the UK and across Europe. T-Systems T-Systems brand serves as Deutsche Telekom’s enterprise arm, offering a full suite of IP, data, voice, hosting and systems integration to domestic enterprises and multinationals. T-Systems is one of the largest IT services providers in Europe (and the number one provider in Germany) with a network presence in 50+ countries. T-Systems is aiming to become the largest business ICT service provider in Europe by 2010. T-Systems has refocused its efforts, concentrating on eight core markets in Western Europe. T-Systems has so far not stated a solid FMC value proposition to MNCs, a service segment that is seeing more business opportunities. Current Perspective: We are taking a neutral stance, because although T-Systems has a strong focus on combining its IP VPN product with a vast range of focused solutions to provide its customers with a full ICT solution there is a unclear and not well communicated message around its enterprise mobility service capabilities. Hence, while the company cooperates with its sister company T-Mobile International at this point in time is has not been perceived as a strong link between these two business units to offer solutions to MNCs. Moreover, it appears T-Mobile International is paying more attention to its FreeMove Alliance partners to face competition than winning together with T-Systems. COLT Telecom COLT offers European businesses and government institutions voice, data and IP-based services over an exclusive fibre network that interconnects 32 city networks in 13 countries. Going forward the company is concentrating on moving further up the enterprise value chain with mobility services. COLT has announced that it will invest between EUR 50 and 100 million over the next two to four years to develop its NGN project. The company will migrate to a single ‘three layer’ NGN architecture incorporating the transport, service control (based on IMS) and application layers on a common Ethernet platform. The company has announced a five-point strategy to establish itself as a trusted provider of data, voice and managed services to businesses in Europe. Current Perspective: We are taking a slightly negative stance, because thus far the company does not have a strong enterprise mobility offering. However, while COLT has an interesting NGN roadmap including IMS services which is worth while to look out for as new mobility services are being launched onto the market it is still early days. Moreover, COLT has yet to decide the level of investment and timeframe, and new services based on NGN upgrades will take some time in getting off the ground.
While putting both the mobile and fixed players on the same playing field is important for any market observer to better understand the market dynamics and competitive landscape, this is not painting the full picture, because there are many other hardware and device vendors targeting this space as well. Players such as Cisco, Nortel and Avaya are either going to address the enterprise mobility market directly or indirectly. In many cases these players find it more profitable and convenient to go directly because many of them already have a huge customer base. Obviously they would need a link into a mobile or fixed network infrastructure; both these aspects are normally not a problem to arrange with telecom operators’ wholesale units, these units are normally more than happy to sell them. Another thing is that many of these players are not looking at telecom service providers as the main competition for enterprise mobility, but rather IT departments in MNCs with a DIY attitude. Moreover, to add another competitive dimension to the competitive landscape, system integrators such as EDS and Dimension Data have all invested and expertise in deploying enterprise mobility solutions, but would need of course to lease network infrastructure from or partner with network service providers to be able to offer a complete enterprise mobility offering. However, in terms of the competitive landscape among the mobile and fixed operators serving MNCs and the current perspectives on each player, who are the players leading in the European enterprise market today? On the mobile operator side VGE appears currently to be the strongest player with good momentum, but the FreeMove Alliance is trying to catch up, and Sympac is in certain geographies close to match VGE. On the fixed side Orange Business Services is probably the best positioned (also as part of Freemove) and BT Global Services is somewhat trailing behind to serve MNCs with enterprise mobility solutions. From a converged fixed and mobile perspective the European fixed service providers are ahead of the mobile operators in terms of selling complete enterprise services due to their history, current capabilities and publicly available roadmaps. However, the chances are that many of the pure play mobile operators can win a significant share of the growing enterprise mobility market. In summary, to achieve significant success in a crowded enterprise mobility market all players need to define their own ‘Blue Ocean Strategy’ (i.e., the theory created by Professors W. Chan Kim and Renée Mauborgne of the INSEAD business school), because going head to head will not serve them very well in the long term. Instead, focusing on innovation and navigating their companies away from tough battles towards areas that are untapped and uncontested will be instrumental. Thus, the cornerstone of a blue ocean strategy is 'value innovation'. A blue ocean is created when a company achieves value innovation that creates value simultaneously for both the buyer and the company. Moreover, a blue ocean is an analogy to describe the wider, deeper potential of market space that is not yet explored. CLIENTS ONLY Recommended Vendor Actions
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
 |
|
|
|
|||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
OFFICES |
|
