Ericsson, EY Collaborate on Strategies for Mobile Operations

With traditional revenues under pressure and mobile data use soaring, mobile operators have been forced to evolve both their networks and their business models, and some have been more successful than others.

A study from Ericsson, in collaboration with Ernst and Young (EY), has identified and classified these operators as Frontrunners.

Between 2010 and 2014, Frontrunners enjoyed a 9.6 per cent growth, while competitors in their markets achieved only 2.7 per cent, according to Ericsson’s research report.

In undertaking the research, the results of which have been launched, Ericsson has identified three distinct strategies adopted by Frontrunners.

The research report identified three frontrunner strategies to include: Quality-led progression, which differentiates through high-performing networks and high brand preference; Market-led adaptation, which includes Frontrunners that differentiate through quick adaptation to market conditions; and Offering-led transformation, which refers to Frontrunners that differentiate by being first to market with uniquely designed offerings

The study also revealed a number of ways in which Frontrunners are similar including their views on connectivity and services as differentiators rather than commodities, and their focus on innovating new revenue streams rather than maximizing old ones. Frontrunners display greater interaction between marketing and technical roles, rather than the traditional silos, and they leverage network performance by either utilizing superior network performance as a differentiator or by improving network performance to meet customer expectations.

Executive Director of Nordic Advisory, EY, Martin Sebelius, said: “We clearly see that despite their different strategies, frontrunner operators share a common commitment to network quality. Not surprisingly, Frontrunners constantly seek new ways of challenging industry conventions to make connectivity more relevant to people, business and society.”

Research Director, Mobile Infrastructure and Carrier Economics, Infonetics Research, now part of IHS Inc., Stéphane Téral, said: “This is a well-reasoned study that helps operators in different markets answer the universal question of where to invest and generate returns. Operators are trying to keep up with the growth in data traffic while facing significant economic conditions, including flat-to-declining revenue in often saturated markets. As it provides a nuanced view drawing on a global scope, this study is exactly what is needed for operators to thrive in any market condition.”

“In addition, mobile consumers are very savvy today and understanding what makes operators tick can help them make better decisions as to where to lock in their subscriptions -- I think this study could be as interesting to consumers as it is to operators,” Téral added.

Head of Radio Strategic and Tactical Marketing, Ericsson, Patrik Cerwall, said: “We wanted to understand what makes operators successful in order to be the best partner to our customers. It may sound self-serving, but Frontrunners focus on growth, both enhancing the core business while at the same time exploring new markets and capabilities to secure future revenues, such as IoT (Internet of Things) and vertical solutions.”