The service provider (SP) industry is at an inflection point. During the past couple of years, SPs have dealt with the economic downturn by focusing the majority of their attention on cutting costs -- to the point where there’s very little left to cut. Despite continued economic uncertainty, there is a shift underway to revitalize revenue growth. SPs are eager to identify and execute on new sources of revenue growth -- however, there is also clear recognition that revenue growth cannot come at the expense of profitability. Growth under such conditions means taking advantage of market transitions as they are happening, creating new platforms for growth.
One key opportunity for SPs lies in providing a more expansive set of services to small and medium sized businesses (SMBs)—particularly leveraging cloud-based capabilities. Based on our estimates, the SMB communications and IT infrastructure market collectively represents more than $120 billion in spend for 2010. SPs currently address 60 percent of this spend. By extending into cloud services, much of the remaining 40 percent becomes addressable.
Cisco IBSG Service Provider Director, Tine Christensen, addresses this opportunity in this video:
Contributed by Ash Dahod, Cisco SVP/GM of the Mobile Internet Technology Group
Mobile communications are expanding rapidly, and this is changing the way we all work, live and entertain. We are now truly able to stay connected virtually anywhere, anytime. The market and its associated technological advancements are moving very quickly and this was even more apparent as I met with customers, partners and colleagues at 4G World in Chicago.
We are all aware of the Mobile Internet tidal wave that is upon us and a lot of the talk at the show was how we can prepare for this next wave of technical advancements. Additionally, what was on most of our minds was how we can do this profitably.
I had the opportunity to speak at the conference and shared some thoughts on how the right network with the right combination of performance and intelligence will drive mobile operator profitability.
In the simplest form, we have to change the way we are looking at the market from a technical and business point of view.
We need to look at profitability and the ways we will address revenue and expense. Intelligence will be central to our new business models, new revenue streams and the efficiency of the network. From this perspective, we see that we need to increase the investment in network intelligence.