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The New Frontier for Vendors: An Analysis of Network Services and Outsourcing

Product Type: Market Research Report
Published by: Pyramid Research
Published: July 2006
Product Code: R8-491
Description
Faced with competitive, operational, and financial pressures, operators across the telecommunications industry have gravitated recently towards new business and staffing models as a means of managing costs while they grow their businesses. Pyramid Research has developed an authoritative view on several of these new models.

In the network outsourcing and hosting space, industry dynamics have sparked a radical rethinking of the operator’s role in the network. As such, we have interviewed dozens of operator executives to uncover insights into the areas where they feel they could benefit most from a vendor partner; we have monitored the top-tier equipment suppliers as they have signed large, paradigm-altering contracts with operators around the world; and we have supported these vendors as they have honed their strategies and pursued more business in the outsourcing and hosting area. In this Report we share much of the information we have collected over the past several years, with a focus on mobile operators.

This report will help you to:
  • Size the network outsourcing opportunity worldwide
  • Determine the cost saving potential for outsourcing aspects of your network and services
  • Identify key growth areas
  • Drive service developments
  • Know what services mobile operators worldwide want worldwide
Audience
  • Vendors: This report helps you size the global market opportunity, identify key growth areas and drive your service developments by forecasting the network outsourcing market and reporting the results of dozens of in-depth interviews with executives at mobile operators worldwide.
  • Operators: Measure the impact of network outsourcing on your core business. Our findings indicate that operators can save upwards of 20% through outsourcing.
  • Financial Institutions: Track the greatest growth opportunities and identify the vendors best positioned to take advantage of the network services opportunity.
  • Consultants: Identify the optimal strategy for your clients to reduce costs or capture a piece of the growing network outsourcing market.
Table of Contents
Acronyms and Abbreviations




Executive Summary




Section 1: Why OPEX Matters: Declining CAPEX Results in Greater Focus on OPEX




Section 2: Defining Mobile Operator OPEX




Section 3: Beyond OPEX and CAPEX: Breaking Down Network Services Spend

3.1 Network Build and Deploy: A Huge, but Declining,

Spending Area

3.2 Network Design: A Spending Area in Transition

3.3 Maintenance: As Much as a Quarter of Network OPEX

3.4 Network Operations: Lots of Hype, Lots of Caution

3.5 Training: Opportunity Exists, Assuming Revised Operator Expectations

3.6 Network and Service Management and Performance: High Growth Expected for Ensured Performance and Quality




Section 4: How Outsourcing Will Transform OPEX: 20- percent Reduction in Cash Costs




Section 5: The Vendor Response: Making a Virtue of a Necessity




List of Exhibits

Exhibit 1: Globally, Mobile Operators Are Spending Huge Sums on OPEX

Exhibit 2: as Mobile CAPEX Heads for a Peak in 2007

Exhibit 3: OPEX Breakdown for a “Typical” Mobile Operator

Exhibit 4: Network Services Includes a Full Range of Network Functions

Exhibit 5: Breakdown of Network Services by Category, 2005- 2010

Exhibit 6: Mobile Operator Spending on Network Build and Deploy, 2005-2010

Exhibit 7: Split of Network Build and Deploy Spending by Coverage vs Capacity, 2005- 2010

Exhibit 8: Cell Site Additions, 2006-2010

Exhibit 9: Outsourced Spending on Network Build and Deploy, 2005- 2010

Exhibit 10: Mobile Operator Spending on Network Design, 2005- 2010

Exhibit 11: Outsourced Spending on Network Design, 2005- 2010

Exhibit 12: Mobile Operator Spending on Maintenance, 2005- 2010

Exhibit 13: Breakdown of Maintenance Spending by Sub-category, 2006

Exhibit 14: Outsourced Spending on Maintenance, 2005- 2010

Exhibit 15: Mobile Operator Spending on Network Operations, 2005- 2010

Exhibit 16: Outsourced Spending on Network Operations, 2005- 2010

Exhibit 17: Mobile Operator Spending on Training, 2005-2010

Exhibit 18: Mobile Operator Spending on Network and Service Management and Performance, 2005- 2010

Exhibit 19: The Cash Cost Stack for a Typical Mobile

Operator

Exhibit 20: Outsourced Spending on Network Services, 2005- 2010

Exhibit 21: Outsourced Spending on Network Services, Not Including Network Build and Deploy or Network Design, 2005-2010

Exhibit 22: Selected Vendor Equipment and Services Revenues, 2005

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