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Business Networks Keeping Customers — and Winning More The dominance of wireline carriers’ core service offerings (voice and T1 data lines) is being eroded by the higher perceived value of wireless and Internet services. Access lines in service have declined for the first time since the 1930s. Declines in the uptake of traditional calling features such as Caller ID and Call Waiting, however, may be of even greater concern because of their enormous profit margins. Wireless,
Internet and MSO services offer features
that consumers and enterprises have found attractive and are important
contributors to access line decline. Mobile phones, for example, are
associated with an individual rather than a location. This is
especially attractive to younger consumers living at home or sharing an
apartment; the traditional wireline offering offers less perceived
value and may well never be adopted even as users become more
established. In addition, mobile telephone technology supports a more
attractive range of features: camera phones, push-to-talk, text
messaging, IM and custom ring tones. [Note:
MDU & Dorms: sell Asterisk PBX with secure voicemail, attendant,
locate-me] Internet-based services, especially e-mail and IM, are causing a decline in second access lines. These services reduce the need for dedicated fax access lines while broadband access, especially cable modems, are replacing access lines used for dial-up Internet access. Finally, cable TV HFC delivery systems capable of supporting bundled digital television, Internet and telephone service have the potential to make telephone access lines obsolete. While
this is certainly disturbing to wireline
carriers, an even greater concern is that it is the most attractive
customer segments most at risk: young consumers with discretionary
income. Extrapolation of this trend will leave wireline carriers
with
local exchange POTS subscribers who use little more than local exchange
voice telephone service. The enterprise customer segment is equally at
risk. Enterprise
campus networks are built around Ethernet Layer 2/3
switches and basic Ethernet features have been standardized and no
longer can be used to differentiate among product offerings.
Consequently, WLAN and IP telephony have become the basis of
competition; much like in the consumer market, the most innovative and
attractive enterprises are adopting these technologies, leaving
wireline telecom carriers the least attractive market segments. [More
and more campuses are switching to IP telephony; ask Avaya] Wireline
carriers need not concede all of the
attractive customers, however. Class 5 packet switches from vendors
such as Tekelec, Telica (Lucent) and sentitO as well as the converged
solutions from Alcatel, Nortel, Lucent and Siemens can be used to
provide a much-needed makeover of wireline offerings. The most
attractive features are likely to be simple improvements in the
basic
voice telephone offerings: mobile phone-like features including camera
phones, push-to-talk and text messaging, color ringback tones that
identify the calling party, missed call solutions, unified messaging,
and event notification and scheduling. Features such as these provide
levels of personalization essential to customer value creation and
associated churn reduction. Also, the technology foundation for such service creation, including SIP/SS7 proxies, the Internet and web site development tools, leverages a very large base of software developers trained and experienced in this environment. This increases the velocity, scope, and QoS and feature development while the large talent pool and use of industry standard tools reduces development costs. In addition, applications developed on feature servers using standard website tools easily accommodate the large embedded base of web portal applications and supporting software, permitting rapid and inexpensive rollout of customer-driven services and features. Use of these technologies overcomes the formidable barriers to continuous and short service creation life cycles implicit in traditional circuit-switched PSTN infrastructure. Wireline
carriers’ enterprise customers also can
be offered more attractive services using this same technology. Value-added
feature sets can be created to meet the customer management
needs of specific industries. For
example, the hospitality industry can
extend the advantages of loyalty programs by offering calling and
notification services to participating guests; the services would be
personalized through the guest’s web portal. Distributed (and scalable) Centrex and IVR services can be delivered to enterprises of any size. This is a high-value-added offering especially for smaller enterprises that typically associate IVR with larger, more-established businesses. This is a big win for the wireline carrier as well since small company advanced calling features are currently delivered by PBX and Key systems rather than through network-based services. Aggressive
incorporation of IP-based technologies
into existing wireline carrier service offerings can be used to turn
around wireline carrier revenue erosion while repositioning wireline
offerings to appeal to the most attractive customer segments.
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