Will Windows Azure Fatten Your Telecom Expenses With Thin Client Thinking?

Every few years, software and hardware manufacturers team up to push thin client computing on consumers. Whenever this happens it reminds me of the 90s movie Singles, where one character, pushing his vision for luxury subways for Seattle, ignores the simple truth that keeps getting thrown in his face: “People like their cars.” People like their fat-client, autonomous PCs and devices, too. Now, thanks to the rise of high speed mobile data, Microsoft and others are sounding the call to thin clients again under the guise of “cloud computing.” Windows Azure is one of several such initiatives that promise flexibility and convenience . . . for a price.

The tricky part is the software as a service model built into Azure and other offerings. Do you really want to rent your office productivity software instead of buy it? Do you trust your connection enough to rely on external hosting for any sizable chunk of data? The fact is that you might now, since cell phones and push email have trained us to accept Internet-based services that boost the meager power of mobile devices. On the other hand, it’s yet another item on your bill, and you’ve got to trust that your provider’s giving you a secure, reliable set of services.

From a telecom expense management perspective I think it’ll all come down to a race between hardware and software. If smartphones experience explosive progress in local storage and processing there won’t be much need to rent from the “cloud” (or laptops, for that matter – they’ll probably converge). On the other hand, if software gets big enough or people learn to depend on ubiquitous document sharing they’ll need to plug into the services network. If these start to get hosted over wide-area networks providers will bundle and bill for them. Being telecom companhies, they’ll make billing errors – and we’ll catch them.

Will Android Make Expense Management Easier for Smartphones?

It’s not as smooth looking as the iPhone. The interface isn’t quite as fancy. Still the first Google Android based phone is here. The T-Mobile G1Â went on sale two days ago to largely positive reviews. Priced to compete with the iPhone, the question is whether its features and flexible pricing can compete with sheer Apple buzz. Naturally, from a telecom expense management perspective we’re interested in the pricing, but let’s get into the phone first.

T-Mobile’s marketing angle is simple. It distills the familiar desktop down to your screen and promises the same web surfing experience you’d get from a PC. In addition, the G1 comes loaded with popular Google applications. Notably, Google Street View aligns with how you’re holding the phone based on its built-in compass and accelerometer. Neat, but then again, Street View is often just used as a toy. The more interesting aspect of it is Android’s open standards commitment (and eventual open source release, say Google execs). This means that if consumers bite, the Android Marketplace for apps could explode with new widgets at a rate Apple could never hope to match with its own carefully managed, closed approach – if people can get past the G1’s brick shape.

For cellular expense management, one thing leaps out: T-Mobile actually lets you choose from a bunch of plans, while an iPhone sticks you with a tightly restricted set. This flexibility will give us a lot more power to keep G1 fees down, but the real breakthrough will come when other 3G handsets offer Android with a slightly downscaled set of features to drop into the lower end of the smartphone niche. These phones could serve as an alternative choice for corporate fleets that rely on Blackberries, assuming that push email client Funambol offers comparable service. Some will insist on Exchange for interoperability with the office, but open source means the price point can drop more rapidly once Android hits budget devices. At that point, some people will take a long, hard look at how they really use mobile mail, and whether the G1’s descendants would be the smarter choice.

Canadian Bandwidth Woes Show Why Telecom Expense Management is Necessary

As far as Canadian ISPs are concerned, the OECD’s bandwidth figures are . . . less than complementary. This CBC story on broadband summarizes the issues. Canadians not only pay too much, but suffer from anti-competitive practices and an unwillingness to finish the job of bandwidth penetration. In short: the ISPs gouge consumers, but they’re too cheap to spend that money on providing better service. Trends like Bell’s “traffic shaping” policies make comparisons even worse. Canadians have to deal with one of the worst per megabit costs in the world – US$28.14, compared to Japan’s US$3.09.

It isn’t quite fair to compare Japan and Canada, however. Japan’s population density’s higher and it’s surface area is lower. That excuses much of the difference – but not all of it. For example, even though the per megabit price is far higher in Canada, there’s much less difference in the range of prices per package. In other words, basic broadband access costs about the same in both countries, but in Japan the money goes a long, long way. Part of the problem is that Canada’s stalled on finishing up its infrastructure.

These kind of comparisons become rather important once we think about business usage. The whole range of standard business Internet services (static IP addresses to reliable, high speed bandwidth requirements, etc.) immediately bump into Canada’s failing broadband development – and it doesn’t help that it’s hard to find out all of your options in an environment where there’s no reliable, central clearinghouse that tells you who the ISPs are and what they offer in a given area.

In our experience, it all boils down to the art of selecting the right service package. In Canada it’s a complex issue that depends on these factors:

  • Location: Service varies widely between regions. Is wireless broadband, DSL or cable right for your small business? Do you need a dedicated line instead? Your ability to get these, and what various ISPs will charge depends on region. For example, some providers may charge five times as much to service a particular area.
  • Base Provider: In Canada this boils down to “Bell or not?” Bell’s admitted to arbitrarily curbing traffic. It’s up to any savings planner to know about reselling details.
  • True Bandwidth: “Unlimited bandwidth” is often a misnomer. It’s our job to find out what this really means. Remember that hidden caps can put you on the hook for additional fees.

There’s more to it, but suffice to say that until Canada gets serious about improving its bandwidth again, our services will be as important as ever.

Telecom Expense Management for the Brilliant Phone

I want one box. I want to use it for pictures, phone calls, email, the web and the odd bit of work: writing, spreadsheets – all that stuff. I want to do it anywhere I go, too.

It’s happening in fits and starts, but it looks like I’m going to get what I want. There are still a few barriers. It’ll take a few years for the industry to figure out how to get me fully portable wireless broadband and there will be a painful period where it foolishly tries to charge me a lot of money for it. People still aren’t comfortable with the idea of converging PCs with true mobile devices either, but ultraportables like the Asus Eee are one third of an evolutionary process. The next third is embodied by the iPhone, and represents smartphones with PC-quality apps and an innovative user interfaces. The final third is 4G: packet-based, high speed wireless communications.

Let’s call the result a “brilliant phone,” though in a decade’s time the word “phone” will be an atavism, since voice won’t be anything special, but just one function out of many. It will do all kinds of cool things, but let’s get back down to earth. We’re a telecom expense management company. What will the brilliant phone’s TEM issues be? Here are some educated guesses:

Data Migration: The brilliant phone will be a consumer’s primary data tool. It will have enough flash memory (or a successor format) to take the place of your laptop, leading to the question of how you’ll move this data around when it’s time to backup or upgrade. Carriers currently encourage users to use expensive internet time to send pictures via email and unless you get a smart data plan, charge you by the megabyte for everything else. This method isn’t sustainable. Besides, in a decade’s time you won’t want to run home to a WLAN every time you want to move a substantial amount of data. Ultimately, carriers will provide a solution – and charge for it, too. It will be our job to get you the best deal on their backup and migration services.

Management and Reporting: Telecom management and reporting services will be as relevant as ever in the age of the brilliant phone. In fact, it will be even more important to track usage since everyone will use multiple functions as a matter of course. The era of voice-only usage, already moribund, will be truly dead and buried. While future cell phone plans will be much more generous with data, user management will transform from a straight savings issue to a matter of productivity. You’ll need to know if staff are using the brilliant phone appropriately.

Telecom and Data Billing Errors: Like death and taxes, carrier billing errors are inescapable. They’ll keep overcharging you and we’ll keep correcting them. The brilliant phone will continuously send and receive data from next-generation networks, so outages will be even more of a problem than they are now. You’ll deserve credit for dealing with them; we’ll make sure you get it.

Beyond North America

North American cellular telecom expense management is the heart of our business. Nevertheless, we keep abreast of trends beyond our primary market. There are compelling reasons for doing so – three “Ps.”

1) Products

One of the simplest reasons is that other markets are testing grounds for phones and devices that could be bound for the North American market. As I mentioned in our last article, the Blackberry Bold rolled out in test markets first – including Chile. You have to do more than just observe whether or not a product is hot in one country or another. Look at the relationship between the product, consumer and infrastructure.

Example: Developing nations’ explosive wireless growth and need for inexpensive handsets is a function of wireless infrastructures being simpler to install, and carriers’ commitments to volume sales that overcome low margins. Lesson: Economy handset fleets should be more attractive in rural areas here, too, especially in businesses that rely on personal mobility (on site technicians, for example). Low land line density for phone and internet makes it easier to get things done through a handset, and while carriers have no motivation to make handsets cheaper here, high market penetration in North America means they have to offer them if they want to compete.

2) Policies

Foreign markets provide an array of “What if?” scenarios that tell us what might happen if policies or government regulations change. Mobile communications is probably the most varied field in telecom. Every market has its own government-mandated quirks and unique carrier policies.You could write (and analysts have written) giant volumes about SIM card policies alone.

Example: In the UK, “box breaking” occurs when a consumer unlocks the SIM cards of phones and resells them at a profit in another market. Carriers dislike the practice, but it’s legal. Lesson: Thanks to box breaking, UK dealers are conservative with subsidies and have begun incorporating various policies to limit the practice, including mandatory minutes and detailed tracking procedures to follow the phone’s status. If unlocking SIM cards becomes a mainstream North American practice, carriers here will have to use the same methods.

3) Penetration

Other markets are an excellent way to look at various penetration levels. Europe and Asia are the primary focus here because they include regions with higher penetration levels than North America. Parts of Europe are saturated to over 100% market because many consumers own more than one active handset.

Example: Some European markets have reached the apex of linear growth, so carriers increasingly emphasize new features and higher-end hardware. Mobile banking and purchases are just the tip of the iceberg; converged multifunction devices will be the rule, and not status symbols. Lesson:Â North American providers will have to follow their European counterparts when it comes to attracting business from people who mostly already own cell phones and need a further inducement to switch carriers.

iPhone Madness in Canada!

Well, we got the iPhone in. To use a technical cellular expense management term, it’s getting all crazy in Canada.

Despite my initial skepticism from a telecom expense management perspective it looks like it’s a hit on both the corporate and consumer side of things. Certainly, the iPhone’s capabilities mean the right plan will let it do your Blackberry’s job and give you a bunch of stylish tools, but I was curious to see whether corporate users in particular would tolerate the drawbacks of Rogers’ monopoly. It probably helped that last month, consumer outrage drove Rogers to change its iPhone plans. It looks like the company successfully headed off objections and tapped into the runaway hype.

As you can probably guess, demand is one of the chief issues right now. It’s just plain hard to get an iPhone – estimates put sales at over 90 units per Apple store, per day, leading to chronically low stock. Thanks to our cellular customer service and procurement focus we were able to get them but many others haven’t been so lucky. I have to admit though: Once you see it up close it’s very, very pretty.

Now as I did predict, cellular expense management for the iPhone is tricky business. Rogers has a “one size fits all” philosophy that makes migrating services difficult, though not impossible. You can negotiate plenty of changes if you want to pay $700 per unit, but most customers are in it for the subsidy. If you’re willing to pay for the whole phone though, you can simply add a $30 per month data plan – if you order before August 31st. If you want to pay $199 ($299 for the 16 GB) for the unit you’ll have to get a bundled voice and data plan that costs $60 and up. The bundles include unlimited WiFi access at Fido hotspots, too. When it comes to data usage, that definitely softens the blow.

This is a very general overview of iPhone pricing. The devil really is in the details here, and they include all kinds of fiddly bits around activation, rebates and service migration – but that’s what we do, so we’ll deal with it. The iPhone isn’t the only smartphone game in town by any means, but sure is the most stylish one.

Is there any reason not to VoIP?

Voice over IP technology is a mature technology that in many cases offers significant savings compared to conventional telephony. If you’re already paying for broadband, chances are switching to VoIP is a good idea. We routinely recommend it to clients.

Naturally, this begs the question: “Why bother with traditional telephony at all?” VoIP is useful, but it’s not a telecom panacea. There are still situations where traditional phone service has the edge. For some people, this may take the shine off of VoIP. Let’s walk through them.

No outage protection: If your power’s out, your VoIP phone doesn’t work. If you routinely use a cell phone as well this is probably not such a big deal, but it could become a problem in major emergencies, where wireless networks will slow and fail in response to increased call volume.

911 Problems: IP addresses don’t correspond to fixed gegraphical points in the way traditional phone numbers do. There are a workarounds for this, but they aren’t as reliable as traditional phones. Some regions have dedicated E911 for VoIP customers, but in this case the operator relies on billing information to establish the caller’s location. If your provider has out of date or incorrect information, emergency services may go to the wrong address.

Tied to Internet uptime: When your Internet’s down, your phone stops working. If you suffer frequent downtimes your savings might not justify constant service interruptions.

DoS attack and eavesdropping vulnerabilities: VoIP is vulnerable to packet interception and denial of service attacks in just the same way as standard Internet communications. Mass requests to the phone’s associated IP can shut it down. VoIP is usually not encrypted, so anyone with the requisite expertise can eavesdrop on calls. These vulnerabilities don’t matter to most users, but they’re guaranteed dealbreakers in high-security industries.

Quality issues: VoIP works because it uses the same packet-based protocols as other Internet communications. The drawback is that packet loss will interfere with voice communications. Users may experience a temporary interruption of service whenever the network experiences heavy usage. This parallels the slowdown you might get loading web pages at these times, and it happens for the same reasons. There are also problems sending faxes, but developing protocols may eventually resolve these.

To sum up, if your business has the same needs as a typical household (even if the scale is larger), VoIP might be the cost reduction solution you need. If you have other needs, consider the tradeoffs carefully. You might want to stick with traditional phone service for these reasons:

  • Your company has safety issues to consider. Examples include heavy industry and medicine.
  • Security is important to you. Law, some government contractors and defense industry companies should consider the drawbacks.
  • You send a lot of faxes.
  • Â You need total reliability. Emergency services and other industries that need to be on-call should stick to standard phone service for critical lines.

Note, however, that it’s not always an either/or situation. GILL Technologies can manage multiple services for you to save traditional lines for critical services, and VoIP for everything else. Contact us to find out more.

Whither WiMAX?

Two or three years ago we braced for a yet another communications paradigm shift — one that was supposed to take effect now. The mobile WiMAX revolution would have been fascinating for use telecom expense management folks. Maybe it still will be, but despite the tremendous promises of the technology there’s been more fizzle than pop out of it.

WiMAX is designed to provide WiFi data capabilities over large geographical regions. In North America, it’s seen limited market penetration. Here, it mostly replaces the “series of tubes” most of us use, but at the other end a fixed base station relays it all to local devices, making it functionally identical to standard broadband.

This is all well and good if you’re living in the country and need a replacement for the ol’ series of tubes, but for the rest of us, WiMAX’s real potential lies in providing broadband to mobile devices. Mobile WiMAX standards were approved in 2006 and various hardware companies promised to roll out the hardware by this year. So what happened?

In North America, the carriers and manufacturers are stuck in a holding pattern. Even though 3G has started to kick carriers out of being so miserly with data, the fact remains that the economic motives for companies to support WiMAX are murky, because they create consumer expectations of cheap, universal access — something anathema to the old business model for mobile data access. Hardware manufacturers don’t have any desire to churn out devices that won’t get broad support. WiMAX’s spotty commercial record in Canada and Australia definitely hasn’t helped either. Canada’s forerunner Inukshuk network is a traditional last-mile provider and the CEO of Australia’s Buzz Broadband dubbed his own company’s initiative a “miserable failure,” blaming second tier providers and persistent technical issues.

If there’s a viable future for WiMAX, it may be in the hands of Clearwire after it finishes merging with Sprint Nextel’s Xohm. Clearwire is the focus of a joint venture between several major carriers and may represent a positive next step for adopting the technology. From a telecom expense management perspective, this could presage several interesting changes. Strictly metered data fees are dying, but unlimited plans are generally synched to a few exclusive deals. If WiMAX succeeds, it opens the way for a competitive environment where consumers don’t have to track typical data usage — unlimited high speed will be something your phone just does. WiMAX might not be the winning backbone, but the idea’s on the table — and wouldn’t it be cool?

The iPhone Lands Like a Canada Goose — In Canada, That Is

So, it’s in Canada now. After much speculation, wailing and gnashing of teeth, Canadians can finally get their own iPhones. How did things work out for folks north of the 49th Parallel? Let’s look at the Good, the Not So Good, and the Telecom Expense Management Angle.

The Good: Canadians got hardware price parity — the Canadian 8 GB iPhone is $199. Fueled by rising fuel prices and a downturn in US currency, the Canadian dollar has floated at near parity with the US dollar for a while now, but prices have been slow to change in response. Canadians are used to paying more, but by now they shouldn’t really have to. When it comes to buying the iPhone, they enjoy the same discount as American customers. Canadians should hope that this new parity eventually extends to other products and services but they might have some additional hurdles to jump because . . .

The Not So Good:Â . . . while the base prices are at parity, Canadians have to pay more — sometimes a lot more — to use the same features. Originally, Rogers’ announced plans were . . . insane. The cheapest package for Rogers was CAN$60 for 400 megs and it went up, up, up from there. After widespread consumer outrage, Rogers offered a 6 GB plan for CAN$30 instead — for now. If you don’t get an iPhone by August 31st, Rogers will revert to its previous, cringe worthy pricing scheme.

Worse, Rogers doesn’t exactly want you to know that there’s a deal afoot. Go to the iPhone plans page. Notice how you have to scroll down to see the new plan? How the price isn’t mentioned, and you need to click on an additional link to find it? How, in fact, you could miss it completely if you followed the site’s guidance?

Nice going. And remember: If you buy one, you’re on the hook for three years: the longest iPhone plan commitment in the world.

The Telecom Expense Management Angle: You want to save money buying a phone from a monopoly that only offered a decent plan under duress, seems to be hoping you’ll miss the chance, and reserves the right to eliminate it at any time? What could possibly go wrong?

It’s a pity, really. The 3G iPhone is probably the first iteration of the device that has more than hype and sleek design going for it. It has formidable data capabilities and could be a legitimate business tool, but at post-August 31st rates it’ll be more of a status symbol than anything else. Plus, being locked into Rogers means you don’t benefit from carrier competition.

This doesn’t mean there’s nothing we can do for an iPhone user. We can still monitor usage and billing errors to save Canadian iPhone users money. Better yet, if you discount the branding angle, the iPhone does help you indirectly, because other manufacturers are stepping up to the plate with exciting mobile devices aimed squarely at iPhone’s niche. Once they mature, you’ll be able to get a cool equivalent without hooking up with a questionable plan.

More Telecom Expense Management Lingo

Last time around I told you about a bunch of common cell phone plan-related slang and abbreviations. This time around, let’s look at some other terms in general (mobile and landline) telecom expense management. We use some of them as tracking codes for our Management and Reporting Software.

Here goes:

2G: Second generation mobile device that uses digital signals instead of analog signals of earlier, first generation phones.

2.5G: A 2G phone with additional data transfer capabilities like true (instead of mobile format) internet. The first Apple iPhone is an example of a 2.5G phone — the second claims full 3G status.

3G: Third generation mobile devices. These can handle true broadband-rate data transfer, allowing services such as video calling.

ACO: Additional call offering. An ISDN feature that allows calls to one number to be routed to multiple phones. Used to handle incoming calls in an office.

BVM: Basic Voicemail

CDR: Call Detail Recording – an automated database element used to generate billing. CDR errors or CRD interpretation errors will cause billing errors.CID: Caller ID

EVM or AVM: Enhanced Voicemail

EW or E&W: Evenings and Weekends, in the context of long distance or cellular services.

ISDN: Integrated Digital Service Network. A network capable of providing multiple telecom transmission services (including voice, video and internet) simultaneously.

TEXT, TXT: Text messaging.

Mob, Mobi, WWW: Mobile Internet. 2G Internet was limited to specially configured mobile-friendly sites due to screen and bandwidth limitations, but newer phones display Internet content in the same way as standard computers.

DB: Detailed Billing. This is often available on request and is a prerequisite for competent telecom auditing.

EMSG: Email Messaging.

FIM or FIMF: First Incoming Minute Free.

LDS: Long distance savings/saver.

M2M: Free calling between members (of a company/organization) – M2MLD includes free long distance between members.

POTS: Plain Old Telephone Service. Basic phone services.

TV: Television streaming.

VOICENET: Voice to Email.