When times are changing, rather than making investments with uncertain returns, leveraging transformation as a competitive advantage by optimizing your network will not only help companies better serve themselves, but their customers as well.

 

With the telecom market in a state of flux, operators are facing an array of challenges from both new and traditional providers seeking to gain competitive advantage. A fully managed transformation center can help network operators effectively compete and differentiate in today’s service-driven environment.

 

A recent Alcatel-Lucent (News - Alert) whitepaper outlines several different business models, in which operators can realize a host of business benefits more rapidly and more cost-effectively. A so-called “managed services” partner with a deep mix of experience and expertise can help in fully realizing the benefits that these business models enable.

 

In fact, according to the whitepaper, studies show that outsourcing and infrastructure sharing can help operators increase their free operating cash flow by as much as 10 percent.

 

The latest trend is for fixed, fixed-mobile and mobile operators to work together to deliver broadband services. For example, cable television providers are offering multimedia content, high-speed Internet access and voice services. Many IP voice operators are bypassing the traditional telecommunications network entirely to deliver their services via the Web.

 

According to Alcatel-Lucent officials, operators need a new strategy in order to differentiate and compete successfully. Instead of relying completely on the deployment of new technologies and rollout of new services, operators should think in terms of adopting new strategic operations approaches and outsourcing business models, company officials said.

 

Given this environment, it’s become even more important for operators to aggressively address their pressing business imperatives. They need a way to increase revenues while improving time-to-market of next-generation services, and reduce churn while improving customer satisfaction.

 

As competitive pressures continue to mount, operators need to view their business in the context of several emerging managed network services and outsourcing business models: assistance and consolidation services; outsourcing/strategic collaborations; build/operate/manage solutions; managed capacity; and business migration with full outsourcing.

 

The first model – assistance and consolidation – is what Alcatel-Lucent officials call “the simplest” of the emerging outsourcing models, and can be seen by operators as a first step in addressing their business needs; this model offers operators the benefit of lowering their operating expenses.

 

In the outsourcing/strategic collaboration model, the operator transfers a series of network facing operations functions to the managed services partner. The benefits of this option include optimization of opex and, potentially, capex; improved time to market; and transfer of risk to the partner, who is then responsible for overall network performance and management, Alcatel-Lucent officials said.

 

The build/operate/manage solutions model is a comprehensive multi-phase paradigm that addresses an operator’s need to cost effectively plan, design, engineer, roll out, operate and manage a new network deployment. The benefits of BOM to operators include optimization of opex and capex, risk transfer to the managed services partner, improved network performance and improved time to market.

 

Further, in the “managed capacity” model, the operator contracts for a BOM or outsourcing solution. But the solution combines services and network equipment in a creative pricing model with payments based on a unit of equipment or capacity, or on a percent of revenue. The managed capacity model delivers a number of benefits by further reducing capex and opex; it also shifts some of the operational and technology obsolescence risk to the partner; and it enables improved network performance.

 

Business migration with full outsourcing basically likens itself to business transformation through a full outsourcing solution, combined with different migration activities in the space of network technologies, subscribers, services, OSS/BSS, and business and operational processes, according to the whitepaper.

 

Alcatel Lucent implements all of these models with various operators, company officials said. In fact, the company already provides these services to operators handling some 120 million subscribers, in more than 70 different networks around the world.