Enterprise mobile data accounted for only 3.5% of mobile operators’ revenue in 2007, so developing new applications and services has not had a high priority with mobile operators until very recently. Now, however, many mobile markets in Western Europe are saturating and average revenue per user (ARPU) values are falling. Enterprise mobile data is starting to look more interesting because it is a largely untapped market. Analysys forecasts that spend on enterprise mobile data services in Western Europe will grow by EUR3.5 billion in 2008–2013.
The success RIM has had with its flagship BlackBerry device has shown that it is possible to generate significant amounts of revenue from, and rapid growth in, enterprise mobile data applications. Because of the success of the BlackBerry, users are now accustomed to carrying a data device, which makes it possible to extend this concept to other applications. A wide range of other enterprise applications, ranging from simple homemade applications, (based on email with attachments) to sales force automation, could be accessed from existing email devices.
Many valuable applications emerge from very simple alterations that make existing applications much more usable. The BlackBerry device is an example of this: pushing email to the device, instead of requiring users to log in to check their inboxes, transformed a service that people rarely bothered to use into a must-have for executives. Technologists have already devised many other potential applications that could quickly become mass market, if presented in the right package.
Some of these applications require integration with company information systems and will have to be custom designed and integrated. For example, managers are already being provided with continuously updated key performance indicators, such as footfall in a shop, which need to be pulled out of enterprise accounting or enterprise resource planning (ERP) systems. MNOs are investing in systems that will allow the integration to be done more quickly, and at lower cost, by deploying platforms like the one recently announced by Vodafone, which uses standard applets to link a mobile interface to a company’s SQL database.
Another area with significant growth potential is machine-to-machine applications. These will often play a part in customised field-force applications, such as taking measurements to determine if an engineer needs to visit. There is still a great deal of untapped potential in the provision of applications for logistics and transport systems, road signs, all types of asset tracking and monitoring, meter reading and healthcare. As the price of mobile data falls, new applications are opening up. For example, it can be more cost effective to put a SIM card in a CCTV camera than to install fixed cabling, if the fixed-price data bundle is cheap enough.
Some applications with wide appeal could be offered to small or medium-sized enterprises (SMEs) that do not have ERP systems, if the MNO forms a partnership with a software-as-a-service (SaaS) provider. For example, SMEs that do not currently use customer relationship management (CRM) or accounting systems could be offered accounts with salesforce.com and Sage, providing their sales teams with information and giving users the ability to enter sales leads, timesheet data and expenses information from a mobile device; mobility may be an important incentive to adoption. Lone-worker applications, developed for clients from social services and healthcare agencies, could be turned into mass-market products for other types of organisation, such as estate agents.
Analysys has forecast potential enterprise spend on both vertical and horizontal applications to 2013. In Western Europe, spend on custom applications is expected to more than double over the period 2008–2013, owing to the contribution from machine-to-machine solutions, while spend on mass-market applications is expected to almost double, as shown in Figure 1.
Figure 1: Spend on custom and mass-market enterprise mobile data applications in Western Europe, 2008–2013 (Source: Analysys Research, 2008)
Analysys expects that spend on machine-to-machine applications will more than double in Western Europe over the period 2008–2013 (see Figure 2), and that most of this increase will come from integration and monitoring.
Figure 2: Spend on machine-to-machine services using SIM cards in Western Europe, 2008–2013 (Source: Analysys Research, 2008)
MNOs are not likely to be the recipients of all of this spend. Much of it will go to managed-service providers and systems integrators, which have proven expertise in developing enterprise data applications. Nonetheless, MNOs could have a bigger role in the SME market segment, which is expected to be roughly half the size of the corporate market (see Figure 3), although, in order to achieve this, they will have to develop new channels to market and new hosting platforms. It will not be easy to persuade high street mobile phone shops to sell sales-force automation or timesheet applications, and MNOs will have to make more use of telecoms value-added resellers (VARs). The VARs are currently wary of developing a mobile reselling business because they feel vulnerable to being squeezed out in favour of direct selling. If MNOs want to develop a mobile data business for SMEs, they will need to strengthen their relationships with VARs so that they can use the VARs to provide SME customers with the education and advice they will need before they buy such complex products.
Figure 3: Spend on mass-market enterprise mobile data applications for SMEs and corporate businesses in Western Europe, 2008–2013 (Source: Analysys Research, 2008)