11 Jul 2011
Arun Bansal, head of South East Asia and Oceania region at Ericsson, explains why the company’s managed services business is expanding to cover new trends, from network sharing to cloud services, and even beyond the telecoms sector itself.
Arun Bansal: There are different factors in different markets, but in general, there are four key drivers. First: it’s a cost driver for some operators. Second: handling the complexity of the networks. With IP coming in, modernization, data growth and signalling complexities, operators are looking at outsourcing that to partners like us to handle that. Third: greenfield opportunities like what we’re seeing with the NBN in Australia, where operators are building a new network not necessarily just for themselves, but in a way where they need to focus on their core business of selling subscriptions and services to end users, so they look for outsourcing partners to allow them to do that. And fourth, particularly in the Asia-Pacific region, is service assurance. There are a lot of operators working in multiple countries that want to provide a seamless end-user experience when it comes to data services and that adds more complexity to the network, so they need partners with global scale to run it effectively and focus on the end-user dimensions.
The telecoms market is undergoing a transformation on several levels, from infrastructure consolidation to all-IP platforms and cloud services – is that broadening the scope of managed services as well?
Absolutely. Network is only one component. You also have the IT component, and we already have operators offering cloud services to enterprises, and we’re managing that for them too. Another aspect coming up in some parts of the world is network sharing, where we merge a couple of operators’ networks, providing efficiency gains, rationalizing the existing networks and then operating it. We’re doing that already, and we work with operators to create an open-access model, a carrier’s-carrier model, or passive or active infrastructure sharing – whatever they require – together with our managed services offering.
What are the challenges involved in that from a managed services perspective?
It requires a lot of planning and forethought, because in some countries the regulations either don’t allow it or restrict the ways you can do it. You get into areas like frequency ownership that determine the extent to which you can share networks. Also, operators have different reasons for considering network sharing, so our solution has to help them achieve the goals they have in mind – is it a time-to-market issue, is it about geographical coverage, is it to block a new entrant, is it to take on the No.1 operator in the market, is it about economies of scale? Then you can look at network sharing models that can achieve their goals.
How big will the managed services business overall be in Asia-Pacific?
It’s definitely heating up in Asia. A lot of operators are interested in having someone handle the network complexity for them with the data and IP signalling, and others are building new networks. They’re facing increasing pressure to build up revenues, they want to be more efficient and focus on consumer demands for better services, and they will look to outsourcing partners to rationalize their cost base, improve their end-user services, and have management attention on the right things. Also, network sharing is a big area coming up in Asia-Pacific, where we’ll see more and more operators going in for that kind of solution.