An enterprise revolution in your hands

Enterprise email and mobility solutions have so far been slow to emerge, but can the channel provide the missing link between mobile operators and customers? Martin Courtney takes a closer look at this exciting next stage of convergence

Research firm Gartner last year estimated that out of six billion corporate email accounts in use worldwide, less than one per cent were accessed from mobile platforms such as hand-held PCs or smartphones. Given the size of the market opportunity, Gartner now expects rapid expansion, predicting that 80 per cent of workers will use wireless email from some sort of mobile device by 2008.

The big question is how those mobile email solutions will be delivered to business customers. Most agree that the industry has so far failed to capitalise on nascent demand for enterprise mobility solutions. Handset makers, mobile operators and application developers now realise they need a trusted, established route into enterprise customers’ pockets, and the role of the IT reseller looks poised to become increasingly vital.

Nokia, which set up a division dedicated to serving the specific mobile needs of enterprise customers two years ago, has been seeking to redress the business/consumer mobility imbalance for some time.

Financial figures released in January show that sales of enterprise solutions still make up only one per cent of Nokia’s revenues, indicating that the handset manufacturer has struggled to develop an attractive proposition for business customers or deliver it to market.

Tero Ojanpera, Nokia executive vice-president and chief strategy officer, conceded that a lack of suitable handsets to support mobile email was one barrier to take-up.

But he added that the mobile operators must shoulder some of the blame, having focused too much on attracting consumer, rather than business, customers whose needs are less complex to understand.

“It is true that Nokia is not where it wanted to be,” he said. “The portfolio is not as broad as it should be. The operators have tried to take the route of least resistance to market and have not focused on pre-pay business customers.”

Mark Cope is managing director of specialist mobile solutions reseller Jem Telecom, which provides mobile email services based primarily on Research In Motion’s BlackBerry device. He pointed out that mobile operators rarely make any background noise about enterprise solutions, if they promote them at all.

“You tend to find that the operators attract a professional consumer market for mobile email applications; that is where they see the market sweet spot,” he said.

Fasthosts is a hosted email specialist that delivers Exchange-based messaging and personal information manager (PIM) services to the channel that resellers can then tailor for their enterprise customers’ needs.

Chief executive Andrew Michael said that mobile operators do not understand how to market mobile email services to business customers. He pointed out that transmitting high volumes of email and attachments over cellular networks can have a negative effect on costs and performance.

“It could be that the message is too confusing for the operator’s marketing at the moment, or that the financials of the extra data use don’t work for mobile operators,” he said. “Mobile email requires some education of the market and there isn’t enough density of interest yet to make this a priority.”

Michael also believes that in most cases, the operators do not yet have the necessary infrastructure to support the proper professional email services that businesses require, and this is another reason why they may be dragging their heels.

Clearly, as long as email messages travel over their networks, the mobile operators are a central component in the whole mobile email machine. However, even when they have proved keen to bang the enterprise drum, there are challenges for the handset makers and software developers partnering with them to provide the right solution.

Jamie Cowper, marketing manager at mobile email security specialist PGP, said it can often be complicated for partners that rely on the carriers rolling out appropriate software, exacerbated by delays because everyone has to do it at the same time.

“There are things that as a reseller you would not have control over; a [mobile] security one-stop shop can’t tell Vodafone what platform it needs to offer its customers, or what to put on its network, for instance,” said Cowper.

The biggest barrier to entry for VARs and end-users may well be cost, however, with operators being criticised by customers and partners alike for charging too much for their enterprise mobile data solutions.

“Talk plan conflicts are probably the biggest barrier,” explained Michael. “If the operators don’t offer value data packages, or charge additional fees for not using operator provided email services (such as @tmobile addresses) then the service won’t appeal to the marketplace.”

Sarah Burnett, senior research analyst at Butler Group, said that from the customer perspective, the advantages of mobile data solutions outweigh the costs. She said that for now, it is mostly systems integrators (SIs) who have the stranglehold on providing enterprise services in tandem with the mobile operators, a situation that complicates their delivery and helps keep prices high.

Burnett said: “Enterprises are willing to pay, but the market is controlled by system integrators and that’s where the deadlock is. It means that the operators don’t have the muscle they would like when selling solutions.”

Though it is important to remember the false dawns of the past, a flurry of recent activity suggests that the market for enterprise mobile email may finally be on the verge of fulfiling its potential.

A range of new smartphones with integrated support for mobile email and other business applications were launched at the 3GSM mobile technology showcase earlier this year, with more new devices anticipated over the next 12 months.

“The operators are realising that [mobile email] is one way to drive their average revenue per user forward, and the next generation smartphones from the likes of Sony Ericsson and Nokia are just hitting the market as well,” Cowper said.

Michael said: “Operators need to embrace mobile email as a way of increasing data usage over their network and use that as a revenue generator. Making the data usage affordable will result in increased usage and higher average revenue per user.”

The operators may also be looking to sign up business customers that are usually willing to pay larger sums of money in advance for data services as a way to prevent the churn that is so characteristic of the consumer market, as users constantly flit between different providers to get a better deal.

“Now the market is mature, and the operators realise that enterprise customers churn less and are more reliable when it comes to paying,” said Nokia’s Ojanpera.

Though they may prove more willing, the mobile operators may still need to find a more effective route to market than they have previously employed before enterprise mobile email can achieve the penetration predicted by Gartner. And according to some, that route is the channel.

“The messaging is increasing over time, but it is a slow process,” Michael said. “Today’s opportunity is with the resellers.”

A report from US market research firm InfoTech published earlier this year indicates that enterprises on the other side of the Atlantic at least do prefer to work with SIs and VARs rather than mobile operators for mobility solutions. It found that only 15-20 per cent of organisations preferred partnering mobile operators for support, compared with 33 per cent for SIs and VARs.

Jeanine Sterling, vice-president and senior programme director at the InfoTrack for Enterprise Mobility programme, told CRN: “In our research, SIs and VARs are far and away the most trusted providers across all four mobile support services discussed.

“The mobile operators’ highest perceived value lies in furnishing remote technical support and on-site service,” she said. “But even in these two areas, their best rankings still place them third in line behind what are probably the more established SI and VAR relationships that have been forged over the years.”

Burnett said: “Resellers already do the same in the UK to some extent; BT is both an operator and a reseller, for example.”

Handset makers are also looking to the channel as a way of bringing mobile email solutions to the business market, though they remain keen to stress that these do not necessarily exclude their oldest and most successful business partners, the mobile operators, from the service equation.

Though no formal deals have been announced in the UK, Nokia recently forged partnerships with Austrian and Polish mobile operators Mobilkom A1 and Polkomtel respectively that will see the two companies sell devices and data plans to enterprise buyers through resellers and distributors, for example.

Gerard Bruen, director of mobile solutions at Nokia, said: “The supportive economic model is not there to support massive mobile email penetration. We want to move into email and we are looking at how we can make that happen. The feedback we are getting is that Nokia is a good solutions partner to do that globally.”

Cope explained that everyone has been expecting telecoms and IT to converge for the past five years, but they now realise it is not so much a convergence as a collision. Even so, he knows that there are significant challenges in setting up the pre-requisite relationships between mobile operators and customers.

“Both sides speak two different languages, and they need resellers like us as an intermediary,” he said. “The IT channel is a fantastic route to market for mobile email but there are challenges, such as setting voice tariffs and procuring the devices themselves. The whole piece can be fairly problematic to get your head around.”

Resellers also need to take a close and detailed look at individual customer profiles in order to understand how workers are using mobile email on their preferred devices, whether these are BlackBerrys, Microsoft Windows Mobile handhelds or Symbian smartphones.

Cowper explained: “Nobody is expecting the IT reseller to have a close relationship with every carrier, but they have to have an awareness of what is in the market and what customers want.”

Another barrier to the take-up of mobile email has been usability, with both enterprise IT managers and end- users being frustrated by the difficulty often involved in setting up and linking mobile email accounts to their own messenging databases and the mobile network.

Michael said this is where the reseller can really capitalise, providing the installation, deployment and support services to frontline workers that the mobile operators themselves have largely ignored.

“Resellers have an excellent opportunity to offer push email services to multiple devices, for example, and show how easy it is to set up and

use,” Michael said. “This is a feature that we expect to be promoted more through the IT channel, as more service providers offer mobile email solutions like ours.”