New international research reveals how enterprises are missing out on major cost savings of as much as 25% in some cases by not moving more or all of their voice traffic from fixed-to-mobile telephones. The results counter conventional wisdom that mobile communications are always more expensive than fixed phones. In fact it outlines how increasing the proportion of mobile phones can in many cases result in lower costs because of changes in call patterns, operational and capital expenditure.
Conducted by BearingPoint, one of the world's largest business consulting practices, in cooperation with Nokia Networks, the study examined factors for and against fixed-to-mobile substitution, and whether major enterprise telecom decision-makers in France, Spain, Germany, Finland, Sweden and the USA are aware of the concept and its benefits.
The research concludes that mobile service providers are now in a stronger position to seize more enterprise voice traffic market share from fixed telecom providers through negotiating per-minute tariffs with enterprise customers that are both profitable and can produce cost savings of up to 25 percent.
Despite the large-scale use of mobiles within business, the analysis revealed enterprises typically decide upon the proportion of mobiles to fixed phones based on employee need and with no consideration about cost savings. None of the enterprises interviewed had processes in place to systematically minimise total telephony costs based on all the factors involved. Although awareness of the cost saving opportunities of fixed-to-mobile substitution was low, a substantial majority of the decision-makers interviewed said that they would welcome further investigation into how the concept could be applied.
"Determining the total cost of telephony within the enterprise is a complex issue. This study gets right inside what the variables and barriers are. It reveals that few if any enterprises have an in-depth understanding of how they could optimise costs between their fixed and mobile phone usage," says Mikko J. Salminen, Director, Fixed to Mobile Substitution Program, Nokia Networks.
"What is striking is that the opportunity to reduce costs through moving more voice traffic to mobiles is available and offers a multi-billion Euro cost saving opportunity to enterprises globally under the right conditions," he adds.
About the report
One side of the research project examined the right conditions for successfully migrating from fixed to mobile within the enterprise, whilst also acknowledging how telephony costs today comprise many more different interconnected factors. The key finding is that with most enterprises having both fixed and mobile telephones, the volume of inter-network traffic is often unnecessarily high and therefore expensive. In many cases, increasing the proportion of mobile phones results in lower costs because increased mobile charges are more than offset by decreased inter-network call charges among other benefits.
Other preconceptions on costs were also reconsidered. Whilst fixed-to-fixed internal calls are often free of charge, the associated infrastructure is costly to maintain. The actual volume of fixed to fixed traffic also is smaller than thought, as employees are increasingly making internal calls to colleagues' mobiles because this is a far more effective way to reach them. In addition, as many employees have both fixed and mobile company phones, there are obvious opportunities to abolish duplicated infrastructure and costs. This includes removing the costs associated with diverting calls from desk phones to mobiles, for example.
In its market research programme Bearing Point interviewed senior decision-makers in the IT/telecom departments of European and American enterprises about how they managed telephony costs and their awareness of how fixed and mobile telephony costs could be optimised more efficiently.
About Nokia
Nokia is the world leader in mobile communications. Backed by its experience, innovation, user-friendliness and secure solutions, the company has become the leading supplier of mobile phones and a leading supplier of mobile, fixed broadband and IP networks. By adding mobility to the Internet Nokia creates new opportunities for companies and further enriches the daily lives of people. Nokia is a broadly held company with listings on six major exchanges.
Media Enquiries:
Nokia Networks
Communications
Tel. + 358 7180 38198
Email: networks.communications@nokia.com
Nokia
Communications
Tel. +358 7180 34900
Email: press.office@nokia.com
www.nokia.com