As end users discover how to use their connected devices in new and innovative ways, they have demonstrated an almost insatiable appetite for applications.

 

Alcatel-Lucent’s (News - Alert) Market Advantage Program research reveals that end users are willing to pay for new value, whether that be in the form of instant access to content, security, privacy, continuity of services across devices or personalized services across any screen.

 

According to a recent white paper, the past 18 months have seen an explosion in the number of applications that are available to end users: mobile applications, widgets on TVs and PCs, as well as enterprise applications of all types. Despite the new revenue potential, network providers have several concerns branching out into this area – working with external developers; risks of negative impacts on a network provider’s network, systems and brand are commonly cited.

 

Overcoming legacy networks and business models by embracing open service innovation can unlock opportunities for operators. Exposing assets to third parties through trusted partnerships, for example, could be a potential stepping stone along the route to a more standardized platform for exposing capabilities on a larger scale.

 

Alcatel-Lucent studies have found that one-third of network providers believe that a legacy mindset within the organization is a major obstacle to launching more open application initiatives.

 

However, industry research shows the market potential is nearly limitless. While the total size of the application enablement opportunity is not yet known, Alcatel-Lucent’s research indicates significant revenue potential. Alcatel-Lucent Bell Labs (News - Alert) has modeled its quantitative research in 15 developed countries. The results show that the five-year cumulative value of end users’ willingness to pay for services that include high-value network capabilities is at least $100 billion.

 

“With application enablement, high-value network capabilities can be exposed and ultimately managed and controlled to deliver an enriched and trusted experience end users will pay for,” according to Alcatel-Lucent officials.

 

Alcatel-Lucent has developed specific recommendations to help network providers capitalize on the application opportunity. Specifically: 1) building a holistic business case; 2) exploring new business models; 3) industrializing operational processes; and 4) lessening fragmentation to achieve scale.

 

For operators to remain an integral part of the value chain, Alcatel-Lucent officials said they will need to build a successful and sustainable position in the emerging ecosystem through more open and agile application enablement.