Wake Up, Service Providers — You Can Make Money Selling More Than Just the Pipe

Telephone networks were originally optimized for voice, not the ever-increasing demand for bandwidth-hogging video. But while networks have adapted and are addressing consumers needs, the revenue-cost structure for video primarily benefits application and content providers, not service providers, which squeeze out most of their revenue through cost-cutting measures. But as demand increases, service providers can’t just keep raising network capacity because overall maintenance and management costs rise with it.

A more dynamic solution is Alcatel-Lucent’s High Leverage Network. No need to give everyone the same level of service if they’re not using it; better to dynamically allocate bandwidth depending on the service (voice, video or data) and when/where it’s needed. The aim is to maintain quality of service for any given application while reducing cost.

With the High Leverage Network, bandwidth scaling doesn’t have to be viewed as a cost center but an opportunity to build out more business. Think of it this way: If customers are demanding more, then they’re spending more time on your system. And if they’re on your system, then they’re in your store. Improve that relationship by capturing real-time information such as presence, location and their ever-changing preferences. In turn use that information to upsell them on higher-value customized offerings.

That’s just a sampling. Remember, service providers aren’t relegated to just selling their pipe. There are so more opportunities. To learn more about those opportunities, read Teleconomics: Doing More with Less: The Key to Sustainable Business Models (PDF) for Telecommunications.

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