TEM, MDM and MAM market: further consolidation to come
2013 saw a raft of acquisitions, driven mainly by Tangoe burning their way through not one, but two IPO war chests and buying anything that wasn’t firmly bolted to the floor. But they weren’t the only player — take, for example the recent announcement of Citrix’s proposed take-over of Zenprise.
As the bigger players continue to get bigger, there will be further consolidation in the TEM marketplace. However, one of the key requirements is the ability to deliver quickly and effectively – and here some of the larger providers have recently hit problems over delivery and scalability, particularly when it comes to deploying overseas. There is also a real problem with some of the larger players’ ability to incorporate their new purchases properly into their corporate cultures without shedding key staff in the process.
So while consolidation will continue within the TEM marketplace overall, it will probably be most apparent in the Mobile Device Management (MDM) space, where there are a large number of smaller suppliers with limited ability to serve the needs of international enterprises.
BYOD market will continue to see exponential growth
It’s sometimes difficult to determine whether a trend – and Bring Your Own Device (BYOD) is definitely still a trend – is becoming mainstream, because what is said in the media does not always reflect the reality we see in the enterprise. So despite a lot of hype in 2012 about the rapid spread of BYOD across every walk of life, our own experience shows that adoption has in fact been slower.
That said, the trend continues at a steady pace and will definitely become mainstream during 2013.
Kevin Bailey, IDC Research Director for European security software, said recently that only around 10 percent of the market had actively embraced BYOD, with the remaining 90 percent either deciding not to allow staff to go ahead or still evaluating their options. In his words: "This isn't new: people have been able to bring devices into the workplace for a while, but it is now using more resources. There are tax and legal issues to consider around BYOD”. This tallies with our own observations, that about 25 percent of the market has specifically opted for BYOD while another significant segment is ready to do so shortly – partly due to pressure from staff, and partly due to the realisation that the iPhones and iPads attached to the corporate network pose a major security risks unless they are properly managed.
M2M market set to take off
According to Machina Research, the number of machine-to-machine (M2M) connections worldwide will grow from two billion at the end of last year and an expected 2.4 billion at end-2012, to 18 billion in 2022 – driven by the consumer electronics and intelligent building sectors, which together will account for 70 percent of the total.
By the same date, total market revenue will reach US$1.2 Trillion, compared to just $200 million in 2011. Two thirds of that figure will come from devices and installation, but one third – $400 Billion – will come from M2M services alone. 90 percent of that $400 Billion will be generated via the service wrap while just 10 percent (or $9 Billion) will come from the provision of basic mobile connectivity, according to Machina. That means the largest growth in the M2M market is going to be in the services area, particularly around Software as a Service (SaaS)
In 2013 more firms will face the realisation that along with all the great benefits of M2M come a number of management headaches. For example: given the expected scale of new MDM device usage, firms will require very good management and administration. Imagine having to order 100,000 SIM cards, knowing which service numbers are associated with each device, which are activated, spare or faulty, matching this to the vendors billing information etc.
Finally, next year will start to see the introduction of alternative communications methods for M2M devices, because SMS is not the cheapest technology or the most practical for every scenario – look out for very cheap “whitespace” radio technology!
The arrival of 4G does not signal the end of Fixed Line services for Enterprise
The launch of ‘EE’ and the arrival of 4G has been big news this year in the UK, and no wonder – the technology promises consumers super-fast download/upload speeds. However, the discerning consumer will be able to see through the marketing hype and notice that the going rate for a 4G price plan, which in the UK starts at £36 a month with 500Mb of data included, is more than a little expensive.
Let’s do the maths. In America, those who already enjoy 4G – and this is still quite a limited number are experiencing 28Mbits download and 12Mbits upload speeds as a benchmark. This is definitely better than most of us currently get with Fixed Line broadband; however, if you want to stream video content over 4G at 28Mbits download speed, you’ll burn through your monthly data allowance faster than a mobile provider can smell a new profit opportunity. Meanwhile, as we all know, “all you can eat” unlimited data packages are rapidly becoming as rare as people without a mobile phone.
What does this mean for the enterprise? What can 4G really offer businesses when some parts of the country are still struggling with 3G, and even GPRS, connectivity? Many apps will benefit from the additional speed; however, there will be no change in the connectivity issues involved in switching between data carriers, and so developers of enterprise apps will still be faced with how to build reliable data transfer into their apps.
Unless 4G can compete with Fixed Line broadband on speed, cost and reliability, both consumers and businesses will stick to a Fixed Line broadband connection, at least for the foreseeable future. The rumours of Fixed Line’s imminent demise have, at best, been greatly exaggerated.
The major challenge facing IT will not be controlling user’s devices, but their behavior.
Some say BYOD is out of control. Research by the Osterman Group this year found “…widespread use of third party, cloud-based storage and file synchronization offerings that are sometimes used with IT’s blessing, but more often not: Dropbox, for example, is used in 14 percent of 1,000+ employee organizations with IT’s blessing – and in 44 percent of them without approval”. Meanwhile, AOTMP recently noted a 3-fold increase between 2008 and 2011 in the number of mobile applications organisations are having to manage, raising further questions about security and the threat of malware attacks.
Part of the problem which led to the unstoppable entry of consumer devices into the enterprise was the strict control which many IT departments attempted to impose upon users. This would have been acceptable if there had not been so many holes in enterprise security — but there were (and still are) and business travellers and home-based employees soon began to exploit them. Modern enterprise also encourages multiple workplaces, which exacerbate the problem.
The other issue is cost. More applications means more bandwidth consumption which in turn, with the aforementioned demise of the unlimited data plan, means higher telecom spend – particularly when roaming overseas. Regular bill-shock stories in the press illustrate the fact that many users, in business as well as in leisure, have yet to realise the effect this can have on their bills: one example cited a firm who went through their entire first quarter’s telecom budget in the first month, after one of their team returned from a trip abroad. In the absence of a Telecom Expense Management (TEM) solution to highlight the problem and a Mobile Device Management (MDM) system to deal with it, it turned out he’d forgotten to lock his keypad before putting his handset in his pocket, where it speed-dialled a series of long distance contacts...
In 2013 organisations will start to realise that it’s critically important to rein in BYOD with a code of practice and policies which all staff must follow: produce a list of acceptable devices, operating systems, applications and other personally-owned or managed solutions; and apply internal MDM solutions to enforce them. This will ensure the corporation does not stray outside the different compliance and data governance laws, including the Federal Rules of Civil Procedure, Sarbanes Oxley Act and Federal Energy Regulatory Commission, not to mention the various EU data laws.
However, this will only go so far. The real challenge for organisations next year will be re-educating users to understand the full implications of the new emancipation around mobile devices in the work-place, and the impact on the business of failure to comply with the new corporate policies. With great freedom comes great responsibility.
Windows 8 – the new BlackBerry?
Microsoft announced recently that it has already sold 40 million Windows 8 licenses. However, as Microsoft hasn't explained fully how it's counting these, it’s hard to tell what that figure really means. We need to be cautious as, despite some very favourable reviews, sales of Microsoft's Surface tablet appear to be slow, while the enterprise PC market has tanked for the moment (ask Dell or HP). However, Microsoft also claims that Windows 8 upgrade momentum is outpacing that of Windows 7. So, with the increased sales of tablet computers generally – popularised, ironically, by IBM’s arch-nemesis Apple – we can expect to see Windows 8 gaining significant market share in 2013, at least in the mobile market.
The point is that Windows 8, no matter what anyone may say, is not an OS for the enterprise PC but specifically for the enterprise tablet market. As sales of tablets outpace PCs and the BYOD movement continues to gain momentum, it looks as though Windows 8, albeit at a stately pace, will begin to take over in some of the areas Apple is missing – although, whether it will pass IOS or Android any time soon is doubtful , given the lead both of those players have built in the market. RIM’s BlackBerry, however, clearly looks vulnerable despite good reviews for its upcoming BB10 OS.
Vendors providing MDM-style services with their core offering become the new norm
The Mobile Device Management market is maturing rapidly, although recent research from AOTMP shows nearly 60 percent of companies in the USA are still undecided on what solution to implement. The twin pressures of an opportunity of that size and the fact that MDM is now the “must have” function for any large organization trying to manage its mobile telecom estate, mean it’s only a matter of time before we see the network providers themselves offering MDM-style functionality with their core services. This mirrors the trend we’re already starting to see in the Telecom Expense Management market.
At the same time, we can expect to see a wave of consolidation in response among the smaller players in the market. Whether those provider-sourced offerings will retain the range of features and level of innovation available from the smaller firms specialising in this area, and exactly how the market will respond when asked to start trusting “poachers turned gamekeeper”, is less clear.
IP-based P2P messaging set to overtake SMS (at least, on smartphones)
In 2013 IP-based messaging (IM) will finally overtake SMS, at least on smartphones in the West and in the area of peer-to-peer communications. Or will it?
More than one researcher has forecast that Mobile Instant Messaging (MIM) in one form or another will displace SMS – if not now, then in the near future. And it’s undoubtedly true that MIM applications such as BlackBerry Messenger (BBM) and WhatsApp, not to mention social networking tools such as FaceBook and Twitter, are rapidly gaining ground where SMS used to rein supreme. Whole gangs of BlackBerry-toting teenagers remain loyal to the brand simply because they rely on BBM to keep in touch with what’s happening in their network.
The problem is that there are so many caveats. First, you need a smartphone – and, despite recent price drops, there are large parts of the world where these are still completely out of reach, financially, for the vast majority of the population. Second, you need a fixed price, unlimited data plan – and, as we forecast last year, these are rapidly becoming an endangered if not extinct species. Finally, it excludes the whole new area of Machine-to-Person communication via SMS, or which more in a moment.
So, yes, MIM will prevail over SMS in some areas, but these will be specific, localised parts of the total global messaging market. The jury is still out on whether this will turn into the all-encompassing rout that some industry-watchers have been predicting.
SMS providers will find new routes to extend the life-cycle
In parallel with the previous prediction and, appropriately, 21 years after it first appeared on a small screen near you, 2013 will be the year that SMS starts to fight back.
In the U.S., Verizon was the first to enable text to the 911 service this year and we can expect others to follow shortly; meanwhile, tyntec, a mobile interaction service provider, predicts that the market for Application-to-Person (A2P) messaging is set to explode. One simple example: the machine-generated text message you receive from your dentist, reminding you of your upcoming appointment later this week.
Tyntec go on to point out how the internet industry itself is extending email and social networking services using SMS. ABI Research estimates that social networks and portals will be generating 314 Billion SMS messages pa by 2015: for example, Facebook is using SMS to extend its reach in developing countries while Twitter already enables users to tweet via text messaging. Elsewhere, app developers and marketers are driving up demand for A2P messaging, as they increasingly turn to push messaging and SMS to drive downloads and boost customer engagement. SMS may well have come of age, but it’s by no means over the hill.
“TEM” as a proposition will broaden into a new offering – birth of a new acronym?
The rapid moves which enterprises have had to take towards more effective management of their mobile devices is also having consequences in our understanding of what we traditionally understand by the term “Telecom Expense Management”. If, as some suggest we should, we abandon the old terminology in favour of a something more reflective of the Rise of the Mobile, what part in the new description does Fixed Line telecom play?
Meanwhile, the realisation is growing among existing customers that there’s more to TEM than simply identifying different areas of over-spend and over-charging on your most recent invoice and claiming it back from your vendor(s). There’s no point in disputing the charge for a leased line into an office in Paris which mysteriously appeared on your last bill, if it turns out your own office ordered it but no-one told you. TEM has, and always will, go far beyond simple expense management to cover the full process from initial user request through authorisation, ordering, vendor receipt and delivery to inventory update and invoicing – in other words, the entire Telecom Lifecycle Management process.
Perhaps 2013 will be the year TEM also comes of age and gives birth to a whole new acronym.
Edited by Braden Becker