Comms4Business News

In 2008, the demand for wireless networks will continue to grow as network speeds and performance improve

Over the next year, enterprises will understand that WEP is obsolete – better measures must be taken to ensure effective wireless network security

802.11n and high speed networks will help drive the wireless industry in 2008

The next 12 months will see an even bigger increase in “non traditional” products that are Wi-Fi enabled and that need access to the network – an example of these are commercial fridge’s that have built in temperature monitoring

The voice over wireless market will boom in 2008 as the number of dual-mode Wi-Fi and cellular phones continues to increase

The wireless industry has gone from strength to strength over the past year – after a bumpy adolescence, 2007 was the year that wireless grew up. The boom in city-wide networks and dual-mode Wi-Fi enabled phones has added to this growth, with enterprises realising that Wi-Fi provision can help increase productivity, flexibility and boost the bottom line through increased remote working facilities and lowered communications costs. AirMagnet predicts 40 per cent market growth in the wireless industry in 2008. According to recent Gartner research, laptop shipments are set to grow by 19 per cent per until 2011, exceeding desktop shipment growth that is predicted to increase by just 4 per cent per year. As the majority of laptops are Wi-Fi enabled, AirMagnet predicts that remote working and laptop sales growth will continue to be key drivers for wireless in 2008.

Wireless security in 2008

43 per cent of companies who have so far resisted wireless adoption in the workplace have done so because they are concerned about how to ensure the wireless network’s security. Security concerns will continue to be an issue in 2008, and organisations must understand that whilst WEP was sufficient to protect the network several years ago, it is now obsolete as hackers are becoming increasingly more sophisticated.

Point monitoring using a mobile device or laptop solution helps increase network security by allowing users to identify isolated risks and troubleshoot the network to protect users.

802.11n

The new high speed Wi-Fi standard, 802.11n, promises users increased network speeds and reliability with raw data throughput theoretically capable of reaching as much as 600 Mbps, over 10 times that of 802.11g. Demand for 802.11n networks is set to be a key driver for wireless networks in 2008 as organisations look to increase speed and bandwidth for data intensive applications. However to achieve the expected performance and throughput, careful planning and implementation analysis should be undertaken. As more vendors begin to deploy 802.11n, organisations will look at implementing these networks as opposed to expanding existing networks.

Voice over wireless With the increase in the number of dual-mode Wi-Fi and cellular phones in 2007, we will see this continue to increase in 2008 as businesses seek to deploy voice over wireless technologies in the enterprise. The convenience and cost savings offered by the technology may have it poised for tremendous growth, but for the application to truly become widespread it has to be as reliable as traditional fixed-line voice services. In order to cope with this increased demand for voice over wireless enabled phones, organisations must optimise wireless access points already installed as well as investing in additional access points where necessary to support additional traffic. Effective wireless network planning is key to ensuring the success of voice over wireless.

Wireless performance in 2008

Wired networks are no longer less reliable than their wired counterparts. In 2008 organisations will continue to strive for optimal network speed and network performance. In order to ensure this, they need to plan ahead using Wi-Fi survey tools for optimal access point positioning.

The deal positions Orange as the only UK mobile operator able to stream live coverage of every televised match of the Barclays Premier League, by adding all of Setanta’s televised games including Manchester United vs Everton on 23rd December, Manchester United vs Newcastle United on12th January and London derby - Chelsea vs Tottenham on 14th January 2008.

As well as providing access to additional Barclays Premier League games, Orange mobile customers will now also be able to live stream all Clydesdale Bank Premier League and Blue Square Premier televised games, as well as have access to other great sporting events available on the select Setanta channels which include the PGA Golf Tour and Magners Rugby League.

Steve Wallage, head of sports partnerships & services, Orange, “This partnership is all about bringing customers closer to the game they love. The addition of the Setanta Sports package to our existing football portfolio was essential to ensure our customers don't miss any of this season's action - we're now the true home for 'football on your mobile'.”

Timothy Ryan, GB marketing director, Setanta Sports, “No serious football fan would risk missing his team's progress this season and the deal with Orange means that need never happen. As well as exclusive football content from across Europe, you can also watch Setanta Golf on your mobile. From the PGA Tour to live action from the Premier League, there's no excuse for not being on the ball."

The Setanta package will be available to Orange mobile TV customers with a 3G handset for a subscription fee of £5 per month.

By combining their 3G access networks (the mobile masts and infrastructure that connects to each operator’s separate core network) T-Mobile and 3 UK will create Europe’s most extensive high-speed downlink packet access (HSDPA) network. Today’s agreement offers customers comprehensive mobile coverage in the first stage of joint development in 2008 and further improvements to quality of service in 2009. It furthers both companies’ joint commitment to deliver true mobile broadband internet access in addition to reliable voice and text services.

Although masts and the 3G access networks are being combined, each company’s core network and T-Mobile’s 2G network will not be shared. Both parties will retain responsibility for the delivery of services to their respective customers and use their own frequency spectrum.

High-speed mobile broadband and data services are set for rapid growth as mobile progressively becomes the individual’s primary means of accessing the internet. Nationwide 3G coverage is essential to meet this growing demand. Blanket population coverage becomes rapidly achievable if individual operators split the investment required and share operating costs. Integration of radio access networks will give a further boost to the pace of development of 3G services, reduce the duplication of costs and the proliferation of mobile masts and extend 3G coverage for the first time to some of the more sparsely populated areas of the country.

Jim Hyde, Chief Executive of T-Mobile UK, said: 3G is a transforming technology, but this will be the first time that a 3G access network in this country is able to achieve both the reach and the capacity to meet the needs of the future. Our aim, quite simply, is to ensure the customer is always best connected. From 2008, customers can expect to have access to high-speed 3G services in a greater number of locations than we can currently serve over our existing infrastructure. By collaborating with 3 UK, we can achieve this quicker and with greater economy - that’s a win-win in anyone’s language.”

Kevin Russell, Chief Executive Officer of 3 UK, said: “High-speed mobile broadband is going to be a key enabler for both consumers and businesses looking for convenient access to Internet-based services wherever they are. This market-leading initiative will accelerate the adoption of new services in a timescale each of us could not have achieved on our own. It also enables us to cost effectively meet customer demand for faster speeds, wider coverage and greater capacity that is starting to arise as mobile devices become the most cost-effective and convenient route to access the Internet.”

Martin Garner, Director of Wireless Research at Ovum, said: “Network sharing has the potential to change the economic model of operators and make a reality of high-quality, high-speed mobile broadband - better, faster and more economically than could otherwise be achieved. Shared opex and capex considerably improves the economics and enables a more practical route to better network coverage, and in particular in-building coverage. Our research shows that the number of 3G users can be expected to grow by over 240 per cent over the next four years."

More than a third (38%) of organisations surveyed said that their current data centre was built over four years ago, which reflects the challenge so many organisations have when coping with the intense power and cooling demands of modern hardware such as high-density blade servers and virtualisation technologies.

More worryingly, a majority of those surveyed, almost two-thirds (64%), admitted they were not planning or building new data centres. The remainder, just over one third (36%), had predicted the demand for scaling with their operations and are building and/or planning new data centres.

Steve Yellen, Principal of the Aperture Research Institute said, “The average time required to plan and build a new data centre is typically three or more years, which leads us to a worrying conclusion about the future of data centres and the impact of this lack of foresight. Data centre managers are already facing day-to-day challenges on managing increasingly complex technologies in old facilities. But adding new technology to an aging environment is like building a high-rise office complex in a rural town. The small town, like a legacy data centre, cannot support the infrastructure requirements for the office complex to operate efficiently and the occupants will never realise the benefits of the upgrade they expected. Installing state-of-the-art equipment in an aging facility will limit the benefits that can be delivered by the new technology, and in some cases, will overload the infrastructure to the point of failure.”

Despite the age and unreadiness of current data centres, there is already an investment in high density computing, with over four-fifths (87%) of organisations having introduced blade servers.

Of survey respondents that were building a data centre, more than a quarter (26%) were anticipating a build time of between two and three years before the centre would go live, while 15% had planned more than three years for builds.

The ARI survey of more than 100 data centre professionals in the finance, healthcare, government, retail, pharmaceutical, and telecommunications industries also highlights the management challenge faced by data centre managers that are increasingly responsible for more disparate and numerous operations. More than a third (38%) of the companies surveyed currently operate more than six data centres and over a quarter (28%) have over ten facilities.

Power demands, one of the challenges that is creating much discussion about and within the data centre industry, is showing little sign of slowing down. More than half (57%) of all respondents with current data centre builds, say their data centre will consume between one and five megawatts, with the same level of consumption being expected by those with planned builds (55%). Almost a quarter (22%) of planned builds will operate between five and ten megawatts.

Steve Yellen concluded, “This ARI survey reveals some worrying trends, as you can’t simply ‘build’ a data centre overnight. Instead of fire fighting the issues created by this short-term planning and trying to manage outdated data centres, organisations should be focused on overall business goals and the role that long-term data centre planning can have in business effectiveness and long-term competitiveness.”

However, Unicom, the Manchester based specialist business-to-business telecoms provider, warns that such action would be a gross over-reaction.

"As a broadband-using country we seem to have become obsessed with the speed of the service we receive, but the fact is that no single operator can truly guarantee the speed of its broadband service," said Chris Earle, Operations Director of Unicom.

"People complain that the broadband service in the UK is massively slow and inefficient compared to developing nations such as Korea - and they just can't understand why," said Chris Earle.

"The speed you receive is based largely on how far you are from the exchange, and the quality of your phone line, neither of which can be influenced by an ISP without physically installing a new connection at huge expense. As a result, most ADSL suppliers will be able to deliver the same speed to you as they all utilise the same copper wires that your phone line uses.

"However, what you download, where you download it from, and how many people are also online at the same time all play a role in how fast your connection is," explains Earle.

"The quality of your ISP's network is more important than the headline speed. Telling customers what their speed is after a connection has commenced does not guarantee that speed in any way, which is as misleading as the 'up to 8Mb' issue," said Chris Earle.

"BT's copper wire network is the fundamental problem. The UK leads technological thinking, but we can't apply 21st century technology to an early 20th century infrastructure," he added.

"The UK will only have a competitive network when the copper wire network is replaced, but without the government's and/or Ofcom's intervention, that may never happen. Perhaps that is where Ofcom's attention should be focussed."

Avaya's one-X Mobile client software, expected to be available in Europe in the first quarter of 2008, will enable the iPhone to be integrated into most enterprise IP telecommunications networks. This will allow employees to add Apple's iconic device to their Christmas present wish-lists without fear of the IT department dismissing it as 'incompatible' with the business' IT systems and networks.

Avaya say they are ahead of the market in creating software to increase business functionality on the iPhone. From the first quarter of 2008, an easy-to-use, downloadable interface will convert mobile devices from Apple, RIM, Palm, Motorola, LG, Nokia, Samsung, Sanyo, Sony Ericsson and others into another endpoint on the corporate network. From the iPhone, users will have iPhone-optimised access to the Avaya one-X Mobile interface, making the iPhone their personal remote control for enterprise communications.

The benefits of transforming the iPhone into a business device are clear. Employees will remain easily contactable on a single number both in and out of the office, as calls are automatically routed through the company network. They will also have access to all the functionality of their desk phones such as; multi-party conference calling, call transfer and abbreviated dialing. This can improve customer response times, worker productivity and business continuity, whilst reducing call costs.

High employee availability will be mitigated by VIP screening that will allow workers to maintain a healthy work/life balance by screening certain numbers at specific times.

With no BT line required, WiMAX enables broadband to be rapidly installed at customers’ premises or homes and offers increased symmetrical broadband delivery. WiMAX is ideal for remote workers and users who need higher uplink bandwidth to send large volumes of data.

"Our aim is to make Milton Keynes the first WiMAX-powered wireless internet city, and partnering with Freedom4 enables us to drive forward our ambitions," explains Steven Jewell, Chief Executive, ConnectMK Ltd. "As the WiMAX network expands, we will have the capability to offer the service to an increasing number of residents and businesses, helping to make Milton Keynes a highly connected city."

Mike Read, CEO of Freedom4 adds, "We have had great success with our trials of WiMAX in the Milton Keynes area and partnering with ConnectMK allows us to reach the wider community. We can also provide services in areas where traditional ADSL broadband access is not feasible, giving residents and businesses a cost-effective alternative to access the latest in internet connectivity."

1. Understand the risks. As organisations open up their networks to their mobile workforce, partners, customers and others, they expose themselves to greater security risks than when traffic was mostly internal.

2. Be proactive. If you cannot identify the weaknesses in your network’s security, someone or something will exploit those vulnerabilities. Educate yourself on current security risks, including the tools and techniques used by cyber criminals. Data security is a moving target that requires ongoing attention.

3. Use cable locks on laptops as visual deterrents. Most cable locks can be ripped off the plastic exterior of a laptop with a strong tug. Like ink-filled garment security tags in clothing stores, cable locks leave a mark when removed by force, but are ineffective at preventing many thefts.

4. Avoid leaving unsecured notebooks unattended. Lock them in cupboards, notebook carts or other secure facilities when not in use. If they must be left in a vehicle, they should be covered up or locked in the boot of your car.

5. Keep laptops inconspicuous. Laptops should be carried in inconspicuous carrying cases, such as backpacks or tote bags, instead of telltale laptop bags.

6. Install anti-virus software, encryption and firewalls. Prevent unauthorised access and protect valuable information with data encryption software. Keep all software products updated with the latest versions or patches to help minimise security holes. Ensure web servers, operating systems and line of business applications are fully patched.

7. Back up valuable data on a scheduled basis. Data backup needs to happen frequently to minimise the risk to the organisation in the event of loss.

8. Create a contingency plan. Identify possible damage should a breach in security occur; also consider how to serve stakeholders in the event of catastrophe. Contingency plans for security should be integrated with overall disaster recovery plans.

9. Use asset tracking and recovery software. Install an asset tracking and recovery tool such as Absolute Software’s ComputraceOne to track and recover computers that are lost or stolen, and monitor any changes or disappearances in computer memory, hard drives or peripherals.

10. Invest in advanced data protection. Use ComputraceOne to track fixed, remote and mobile computer assets and remotely wipe sensitive information in the event that a computer is lost, stolen or nearing the end of its lifecycle.

“For the uninitiated, DNS lets your PC work out how to get to www.cbmagazine.co.uk on the internet. For example, your browser would lookup www.cbmagazine.co.uk and DNS would return 80.79.133.1, which is the IP for the server the website is sitting on. So Enum does something very similar.

Give Enum a telephone number and it will provide you with an address, such as an IP address, to send the call to. In theory this would allow your PBX to send calls directly to a 3rd parties PBX without even previously having connected to them, using SIP.

Unfortunately, Enum is actually quite difficult to understand and there are a number of reasons you need to think through your use of Enum.

Enum is actually a means of mapping a telephone number (E.164 to be precise, +44 etc) to the internet addressing system. Ok, so I’ve probably lost you at this point, so here’s an example:

I want to call +442074401800

My PBX requests Enum details for +442074401800

Enum returns a series of complicated addresses for all the methods that this number can be contacted by. Methods could be SIP, email, IM or even PSTN.

In this example, I want to make a voice call. So I the PBX selects the SIP address: sip: 442074401800@sip.voiceflex.com

The PBX can now make the call via SIP directly to the Voiceflex SIP Proxy.

Enum has more uses than just for voice. If I wanted to send an email, but I only have the persons’ phone number then I could type the number into Outlook and Enum could be used to look up the email address for me. Confusing, well just think that a telephone number will know all the ways you can be contacted. The client (voice, email, Instant Messenger) decides which connection method to use.

What’s been described so far is probably misleading to what Enum is really going to be used for in the next few years. The largest uptake is likely to be the service providers, who can use Enum to save money by directly routing calls via IP to users. Although, the speed of this uptake isn’t clear. There have been numerous successful test runs of Enum, some with tens of thousands of numbers and users.

The overall Enum space and strategy is far from clear, even with the recent UK announcements. Public v Private, underlying systems, architecture and ownership of the data are big issues which need to be worked through. Then we get to the business model, which is probably the biggest issue. Will this information be free? Or will there be a subscription costs or transaction fees? Whatever happens, the first signs of the death of SS7 are on the horizon and the start of real convergence.

Download speed has been an area of much debate in the broadband market throughout 2007, with many ISPs simply not delivering the promised download performance.

A report by consumer group, Which? earlier this year found a “huge” gap between publicised broadband speeds and what most users actually received, with the average speed “enjoyed” by customers on 8Mb packages being as low as 2.7Mb.

Michael Phillips, product director at BroadbandChoices.co.uk, said: “Connections get degraded the further away they are from the BT exchange. Factors like this and poor quality wiring significantly degrade broadband connections and reduce the available speed. It’s simply not possible for every customer to get the advertised speed. Our speed tests show that, on average, customers only receive 35 per cent of the promised speed.1”

BroadbandChoices.co.uk has been continuously monitoring the average speed that ISPs are delivering to their customers since August 2007. Over that period they have collated over 375,000 individual test results across over 8,000 different internet users.

Winners have been awarded a gold, silver or bronze rating in three bandwidth categories:

* Welter Weight – all providers offering up to 2Mb services;

* Cruiser Weight – all providers offering up to 8Mb services (excluding welter weights);

* Heavy Weight – any providers offering up to 16Mb, 20Mb or 24Mb services.

The results concluded that Sky was the broadband supplier that gave the most consistent speeds to its customers during 2007 across all three weight categories. Sky received a gold medal in the cruiser weight category, a silver in the welter weight and a bronze in the heavy weight category.

Close behind Sky, Virgin Media received two gold medals in the welter weight and the heavy weight categories.

TalkTalk did not appear anywhere near the top of the results, having only delivered an average speed of 2.2Mb for its 8Mb package in the cruiser weight division; while the wooden spoon was awarded to Supanet in the Cruiser weight division.

Michael Phillips, comments, “None of our gold medallists actually delivered anywhere near their promised speeds. This really does call for providers to be more honest about the kind of speeds customers can realistically expect to receive, rather than using flashy advertising focused on ever-increasing ‘top speeds’”.

Following discussions with the UK’s six leading ISPs about why consumers often do not get the advertised broadband speeds that they think they are buying, Colette Bowe, Chairman of the Ofcom Consumer Panel, has written to Ofcom Chief Executive Ed Richards asking the regulator to take a lead on the issue:

“We would like to see Ofcom leading discussions with industry to produce an enforceable code of practice that would be mandatory for ISPs. This code would establish agreed processes to give the customer the best information during and after the sales process, and to give them flexibility to move freely to different packages that reflect the actual speeds with which their ISPs are able to provide them.”

Colette Bowe has also asked Ofcom to make information publicly available to consumers on its website. “This information would help consumers understand the technical issues affecting their broadband speeds, and over which they have control. It would also provide quality of service information to assist in their decision over which ISP to opt for.”

The code of practice should include a commitment from ISPs to:

- Inform consumers, during the sales process, about the theoretical maximum line speed they could expect

- Provide clear information upfront about the factors that can affect line speed

- Contact customers two weeks after installation to provide them with the actual line speed supported by their line

If the actual line speed is significantly lower than the package they bought, consumers should have a penalty-free choice to move to a different package or, in certain circumstances, opt-out from their contract. The Consumer Panel spoke with the ISPs in October because of widespread customer discontent about broadband speeds. The “up to” speeds advertised in broadband packages are very often significantly different from the actual, lower speeds experienced by many subscribers.

The Consumer Panel Chairman also wants the advertising of broadband speeds to be tightened up. “I will be requesting that Advertising Standards Authority, working with industry, considers how the range of factors affecting broadband speeds can be given much greater prominence in advertising material. We believe that clearer information in advertising of broadband speeds and the associated packages would greatly increase customer satisfaction.

Three key developments are converging. One: Moore’s law continues to deliver more functionality for lower prices. Mobiles are more powerful, they can handle multimedia content, screens are bigger, but they’re still hand-held devices.

Two: The industry has made much more efficient use of radio spectrum and this has enabled much higher data rates for less cost.

And three: Networks are getting flatter; they’re transitioning to IP — wireless as well as wireline, which reduces OPEX and in turn this is going to drive flat rate models. The new architecture will allow applications to be decoupled from transport, so more and more apps will be hosted in the Internet space. In addition, a new transport layer will aggregate fixed broadband, wireless broadband, and cellular broadband. And finally, the new networks will be smarter.

PUT IT ALL TOGETHER

Smart, powerful devices and smart networks will work together in spectacular ways. Only time will tell what emerges and to a certain extent the functionality will depend on operators cooperating with each other for the greater good: their own and that of their subscribers.

Fixed Mobile Convergence (FMC) can be seen as the first step. FMC allows the same applications to be accessed from different networks. Further down the road the transport/aggregation layer will enable access to all applications via different networks using your preferred device. Thus, apps will be access agnostic and the end user experience will be consistent.

The device will select the best available signal and transfer to another network when a better signal is available. Note that we are not talking about today’s dual-mode Wi-Fi/GSM devices. There will be several air interfaces and the phone will be able to detect them all. That’s due to the processing power of the chips plus the fact that a lot of functionality will be controlled by software, so upgrades will come via over-the-air downloads.

The combination of smart devices working in conjunction with smart networks will even enable the service to be transferred to a different device. For example, you may be watching a football match (it has to be Chelsea) on your mobile and when you get home it will transfer to the TV or a PC.

MULTIPLE ACCESS NETWORKS

Wireline access will be xDSL, cable and fibre. On the wireless side there’s 3G, Wi-Fi, WiMAX, HSPDA and something called LTE (Long Term Evolution). The device will select the optimum network. However, enabling robust connectivity over multiple access networks can only be achieved when security and identity management systems are in place and when they interoperate seamlessly. That can’t be done on the network side alone, as users and their devices may have several subscriptions and also use municipal and free networks. In this case the device must assume overall responsibility.

WILL IT HAPPEN?

There are a number of formidable obstacles to overcome, but the industry has the requisite technology for the new architecture. That begs the question; do the operators and service providers have the will?

On one hand Internet-centric service providers like Google and Skype are challenging them. So something has to give. On the other there is a huge opportunity. Around 5 billion people will have a mobile subscription by 2015, most of the growth coming from the emerging markets, principally China and India. Conclusion: it’s going to be a broadband, ubiquitous wireless world, and a decade and a bit after the bubble, the Wireless Internet will be a reality that we take for granted.

Bob Emmerso Email: b.emmerson@electric-words.org. Web: www.electric-words.org Bob edits his own “Euro Innovations”, a free, monthly newsletter. Send an email to get a copy.

For those that can’t wait for the full Deloitte report Comms Business Magazine has secured a preview of their views for readers as the company warns ‘what appeared to be at first a problem affecting the US sub-prime mortgage sector may actually be a slowdown affecting many of the world’s industrialised nations’. Deloitte says that a vital question for the telecommunications sector is likely to be the extent to which the credit crunch, a global contraction in the availability of credit, may provoke a crisis in the telecommunications sector in 2008.

“An optimistic outlook for the telecommunications sector in 2008 would be that most companies should not suffer significantly, even in countries with large financial sectors that may bear the brunt of the sub-prime correction.

However, the impact may vary by type of company. Equipment manufacturers may be harder hit. It would be easier for a business or residential customer to defer an equipment purchase than to suspend voice or data services for a period.

As for service providers, they may be better able to weather the storm, at least in 2008. The world appears to be far more dependent on telecommunications than ever, and costs have generally fallen. Enterprise communications prices have declined steadily, in line with growing competition and the emergence of efficient software-based solutions. Consumer mobile and broadband prices have also fallen strongly, through a combination of excess supply, competition and regulation. In some markets, consumer broadband is nominally free if other services are purchased, making it particularly hard for customers to cut out this portion of spending. Given this, service revenue growth may hold steady, even if there were to be a downturn in 2008, and as a result, operators’ stocks may be seen by investors as secure.

An economic slowdown may even encourage some businesses to accelerate process changes that require communications. The need for efficiencies may encourage some companies to accelerate their use of offshoring; it may cause others to use home working as a means of reducing office costs; it could stimulate some companies to implement mobile data solutions as a means of improving productivity.

A more pessimistic outlook is that the gut reaction to a downturn may be for businesses and consumers to reduce spending wherever possible. Businesses may look at ways to cut telecommunications costs, both by negotiating hard on rates and applying stricter rules on usage among employees. Consumers may try to cap their spending by opting for smaller mobile bundles or downgrading broadband packages.

Investment may become harder to justify, as higher interest rates raise the cost of borrowing. This in turn may have an impact an operator’s ability to develop new services. Equipment manufacturers, software developers and other suppliers may suffer as result.

Macroeconomic trends are hard to predict and even harder to influence. In the light of current trends, telecommunications companies, while hoping for the best, may need to prepare for the possibility of an arduous 2008.

Bottom line

While a downturn in the telecommunications sector is far less certain than a global slowdown, the industry should be prepared to confront, or even better, to exploit, this possible outcome.

Mobile operators could use the prospect of a downturn to encourage consumers to consolidate all their voice spending on mobile, thus forgoing the monthly fixed line rental. A growing number of consumers have already chosen to make all voice calls via their mobile phones. Operators could try and maintain revenue flows by offering customers lower tariffs in exchange for longer contract terms. This offer may also encourage prepay customers to move onto a contract.

Non-core mobile services, from music downloads to mobile television, could be most affected if consumers cut their spending. Operators may therefore want to concentrate product development and marketing on the services they regard most likely to generate the bulk of revenues and margins, which in many markets is currently voice and messaging.

Mobile operators could also consider a renewed focus on the enterprise market. Operators could argue that mobile-based solutions, such as email and field force automation, could deliver vital efficiency gains to corporations.

Mobile operators may also need to consider starting or accelerating network sharing, for example, their radio access networks, as a way of reducing the cost of deploying and running networks, particularly if data usage remains low.

For fixed operators, demand for consumer broadband is likely to remain relatively steady. Non-core services may, however, suffer. Operators may therefore need to look again at their approach to bundling. Offering discounted combinations of fixed voice, broadband and IPTV appears to have become a common approach among fixed operators. While theoretically this offers good value to the customer, if the market were to slow, the value proposition could unravel. With fixed voice usage in sharp decline and IPTV embryonic, operators may find consumers increasingly indifferent to bundles, particularly in markets where mobile prices are low and free-to-air digital television is widely available. Consequently, operators may find a ‘pick and mix’ approach more compelling and more profitable. By allowing consumers to choose which services they want to bundle, they may be able to improve perceived value, while offering greater choice and flexibility. As with mobile, fixed operators should also consider offering lower monthly rates in return for longer contract terms, in order to stabilize medium-term revenues.

As for the enterprise market, fixed operators should highlight the range of operational efficiencies that could result from more, rather than fewer, communications. Operators could therefore recommend an acceleration of offshoring, video conferencing and home working, all of which could reduce costs.

Fixed operators may also need to re-examine their plans for next generation networks. Many operators’ long-term strategies assume fiber-based networks. While the credit crunch may raise the cost of finance, networks may have no choice but to upgrade, not least because of the expected operational efficiencies from next generation networks. Operators may have to share the cost and risk with partners, or try to renegotiate terms with financiers and suppliers.

Retailers, particularly those specializing in the mobile industry, may have to diversify. Mobile operators are constantly reviewing channel costs such as commissions and subsidies. Should a country’s economy slow, operators in that market may focus efforts on their own, branded stores at the expense of independent retailers. Should that happen, retailers may have to diversify into related products (such as PCs, peripherals and technical support) or services (such as fixed voice and broadband).

For all concerned, but equipment vendors in particular, growth in emerging markets could offset potential declines in the developed world. Emerging nations’ economies are forecast to continue growing steadily despite turmoil elsewhere. Telecommunications operators in emerging markets may continue to yield much higher EBITDA margins that are normal in western economies.

All telecommunications companies should scrutinize their cost base. Some may have accumulated excess weight, particularly during high-growth years. A slowdown may even be the impetus for some much-needed cost cutting and headcount reduction.

All companies should keep an eye out for mergers and acquisition (M&A) opportunities. A downturn could create consolidation opportunities across all parts of the value chain. Some emerging-world telecommunications titans may even consider fiscal discomfort and faltering valuations in the industrialized world as the trigger to start seeking out bargains.