Wednesday 12 December 2007

FMC: The long wait

FMC might take some time to roll out because nobody wants to fix something thats not broken.

According to this old (and relevant) article:

Despite the hype, heavy adoption isn’t expected until the next decade, analysts say. Dragging it down is carrier reluctance to market FMC services and tepid demand among cash-strapped U. S. companies still trialing products from established vendors and newcomers.

“Why would [carriers] want to do anything to disrupt the nature of the return that they’re getting in tariffed services?” asks Robert Rosenberg, president of Insight Research, referring to wireline and wireless carriers such as Verizon and AT&T, which continue to see growing wireless revenue and fat profit margins of 40% to 45% every quarter. “Naturally, they are much happier to take your minutes of use and apply them to cell phones. Same would [be true for] a tariffed voice service. There’s really no incentive for them to rock that boat.”

Both wireline service providers and cellular providers lose revenue when calls are moved off of their respective networks and onto the enterprise’s wireless LAN (WLAN). They lose additional revenue if the off-site traffic is routed to another enterprise network, Insight notes.

A recent article on this topic says:

It sounds like a simple concept, but FMC requires lots of technical stitching on the part of the carrier or vendor to smooth out the seams between the wired and unwired worlds. FMC melds several disparate infrastructures - such as TDM and packet VoIP, IP data, Wi-Fi and various flavors of cellular - into one. There are multiple instantiations of FMC from which an enterprise can choose, which makes the right FMC decision more difficult.

But once the networks are stitched and the decisions about whether to opt for a carrier managed service or enterprise-centric FMC implementation are made, the benefits are manifold, industry experts say. They include the ability to be reached through one phone number wherever you are - at your desk, around campus, roaming about or at home - as well as reduced enterprise telecom costs by, for example, bypassing international mobile roaming charges when making cross-border calls.

Enterprises also can save on telecom costs. In addition to bypassing international roaming charges, businesses can tame their out-of-control cellular bills by selecting one or two service providers or vendors to include cellular as a component of an overall FMC or unified communications package, Mathias says.

As i said in the start, nobody is going to make a move on FMC till someone starts shouting and others start listening to him.

Now, according to a report by The Yankee Group, one of the positives that FMC brings to the table—its cost-savings by moving mobile minutes off wireless and onto wireline devices— does not outweigh the trepidation of enterprise IT professionals and decision makers.

“We see it as something that will hit eventually but in the short term probably not,” said Brian Kotlyar, research associate with The Yankee Group and author of the report, “Productivity is the Prettier Face of FMC.”

Twenty-nine percent of the 302 IT decision makers surveyed for the report considered FMC a nice technology to have but not a critical application on their networking road map. Even more daunting, there is an adoption rate of less than 2 percent for the concept, the report said, so things aren’t taking off in that space even while it might be viewed as a positive.

Finally some stats to put everything in perspective:

Though FMC registers barely a blip on the radar screen, there will be 92 million FMC subscribers worldwide by 2011 and FMC revenue will amount to $28 billion by that time, representing 3% of overall mobile subscriptions globally, according to market research firm Informa Telecoms and Media. The firm says the United States will lead the way with 33.2 million subscribers.

As a consequence, sales of dual-mode handsets will increase to 5% of global handset sales by 2011, Informa expects. Eighty-five percent of these sales will be to consumers adopting FMC services for convenience and cost benefits, although a "significant proportion of revenues" will be from enterprises adopting FMC as part of a unified communications strategy for more effective business interactions, the firm says.

So is anyone doing something on FMC?

If you want to read further:

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