Managing the mobile enterprise effect

It used to be easy to lock down enterprise networks. Remember the days when all you worried about was locking up back-up disks and putting passwords on all the PCs? Laptops, mobility and wireless have quickly changed the situation.

Enterprise security has been challenged by this new age of mobility, and it's hard to devise good solutions when any employee with a wireless device can link to a PC to download confidential company info, as well as all sorts of for-fee add-on programs and services.

And then they walk out the door with that mobile phone. By some accounts, tens of thousands of cell phones are left behind in restaurants each month in any given metropolitan city, many with sensitive information left unprotected. Hundreds of used phones are for sale on eBay and other auction sites. Trust Digital this summer bought 10 phones on eBay and found all sorts of great info, from text messages of an affair to a $50,000 payment on a software license.

Even when you do the right thing and wipe the phone's data, you can still recover a lot of information. In a test earlier this summer, Trust Digital resurrected purged e-mails and other information from a used Associated Press phone that had been seemingly cleansed of any data.

It's enough to keep any CIO awake for weeks on end, and it represents a huge market opportunity for service providers.

Wireless services are an ever increasing — and ever more complex — part of a typical enterprise services portfolio. Mobile voice is pretty much a given for any mobile or traveling worker, and mobile data services like wireless e-mail are also table stakes for many enterprises these days (count the BlackBerries and Treos next time you're waiting in line at airport security).

The widespread availability of both high-speed wireless data services and powerful handsets and devices has moved wireless into the forefront of many enterprise chief information officers' minds. Enterprise applications are increasingly becoming mobilized, and mobile devices are often the frontline tool for many worker's communications and corporate data access.

This trend brings great potential productivity and convenience benefits to the enterprise, but it does so at a cost. Managing these devices — both in terms of understanding the true expense and in terms of maintaining usage policies, data integrity and CIO control over the device — is simply much more complex than the management of similar wireline services.

And the problem for some is not measured in a few dozen phones, but massive numbers of mobilized devices. One recent request for proposal on the street talked about the management issues surrounding 220,000 phones to be managed for one global entity.

With everything from cars to refrigerators getting outfitted with wireless, it's becoming more important to bring this under some sort of centralized control. Luckily, there are a number of vendors and service providers poised to take on these challenges, using a number of different approaches — including software within the enterprise, hosted software solutions and pure outsourced managed solutions.

The most basic issue at work is that there are any devices in many different hands in many different locations — all on the move — and getting services from many different providers.

The very mobility that makes these devices and services useful makes them difficult to track, audit and control. Telecom and IT managers have enough of a challenge tracking their voice usage and data services, but at least those are fixed assets tied to physical locations — wireless devices are tied to users, and users aren't tied to anything. In fact, a major issue that several enterprises have pointed out in recent research by TeleChoice is simply trying to keep track of (and turn off) corporate-liable phones when employees change positions, transfer or leave the company.

Even physically handling the devices and accessories themselves is a difficult job. One medium-sized enterprise recently interviewed by TeleChoice had a team of seven people who did nothing more than handle the intake and output of mobile device orders — ordering product and maintaining inventory, receiving employee orders, adding the right accessories, shipping to employees and handling battery, charger and other accessory repairs and replacements — for a small user base of less than 2000 mobile devices.

Imagine scaling this for an enterprise with tens of thousands of devices distributed worldwide.

Another major difference in the wireless world is the complexity brought about by the need of many enterprises to use multiple carriers. Simply put, for most large and/or distributed enterprises, there simply isn't a single-carrier solution that will provide all of the coverage necessary. Enterprises with many mobile workers find this need intensifies as issues like 3G coverage and international roaming arise. This leads to a profusion of carriers, plans and billing structures for the CIO staff to review, analyze and compare to policy and financial goals and limitations.

Many enterprises also need to deal with a variety of different models for obtaining and paying for mobile devices for employees. Many have a mix of corporate-liable and personal (either expensed or purely personally liable) mobile devices within their networks. There's a definite trend to bring these phones and devices underneath a corporate-liable umbrella for ease of tracking and expense management, but such efforts will take time (one enterprise told TeleChoice it was in the midst of a gargantuan effort to bring nearly 90,000 individual-liable phones into a corporate-liable model).

And even if the corporate leaders want to bring all devices under centralized control, there's often resistance to such efforts. According to John Shea, vice president of marketing at telecom expense management vendor Rivermine, “No one really wants to take on the role of being the ‘mobile police’ — it's a real hot potato.”

Managing expenses, invoices and fiscal liability isn't the only issue that enterprises are facing as wireless grows within their user bases. Equally vexing are issues of service and device management. Within in this category there are three subcategories: device configuration and management, security management and application management.

In the device management realm, enterprises are dealing with potentially dozens of different devices, often tied to multiple carriers. On top of that are different configurations and “allowed” services on a user-type or even per-user basis. The result is a management nightmare often solved by having IT or telecom managers individually configure each device prior to giving it to the end user.

“In order to implement a [wireless] solution, [enterprises] literally have to take inventory into their shop, manually load applications and configurations [and then distribute] ‘loaded’ phones to their employees,” said Jay Highley, CEO of managed mobility services vendor Integrated Mobile. This simply doesn't scale easily for tens of thousands of phones, nor is it an efficient way to handle ongoing configuration changes, firmware updates or restoration of devices.

If configuration is a hassle, security can become a nightmare. Mobile devices go wherever employees go, but they don't always complete the trip — a recent survey by Pointsec Mobile Technologies found that 85,000 cell phones were left in Chicago taxis in a six-month period. Losing a plain old cell phone is one thing, but losing a smartphone synchronized with corporate e-mail and data is quite another. We've all seen corporate horror stories about lost or stolen laptops containing proprietary or sensitive personal information — it's likely that those stories will begin to include instances of the same data being lost on smartphones. And most enterprises TeleChoice has spoken to simply don't have a real and enforceable wireless security policy, nor do they have the tools to implement and enforce one if they did.

Finally, managing wireless applications — and making applications mobile in the first place — is a rising hassle for enterprise IT departments. It's one thing to just take e-mail or messaging mobile, but as enterprises begin to explore taking other applications like Siebel, Salesforce.com and SAP to mobile devices, a whole new layer of complexity arises. Homegrown enterprise resource planning, customer relationship management and other applications must be mobilized as well.

All of these problems are well-known — if not well addressed — within most corporate IT and telecom management organizations. CIOs know that they have pain supporting mobile devices and know that a strategic imperative to mobilize more applications will cause them even further pain. And telecom managers know how hard it is to analyze their wireless spending (only about 10% do so in a meaningful way, according to several vendors researched by TeleChoice), and they know how difficult it is to track the inventory and usage of individual devices over their entire lifecycle — acquisition, through usage and on to employee termination or device renewal.

The market is responding to these needs with a host of offerings from two types of vendors. First up are wireless telecom expense management (TEM) vendors — both pure-play wireless vendors and vendors from the more mature wireline expense management side of things. These vendors are offering combinations of software and consulting services that can provide various capabilities and advantages (see table on this page).

There are many vendors pursuing this space, ranging from tiny software vendors with simple billing analysis solutions to large business process outsourcing (BPO) vendors that include wireless TEM as part of a broader outsourced portfolio of services. Some leading vendors include Asentinel, Avotus, Integrated Mobile, Rivermine and Traq Wireless.

On the device and service management side, vendors have developed offerings, which can provide many services (see table on page 8).

Like the TEM vendors, these device management vendors can provide services through software inside the firewall (in a traditional enterprise software sales model) or through hosted solutions — including application service provider (ASP) models where the hosted software can be virtualized to support many enterprises in virtualized managed services. Leading vendors here include mFormation, Nokia (through their Intellisync acquisition), Sybase (with their iAnywhere Suite), Synchronica and major new entrants to the space such as HP and Motorola.

On top of both of the TEM and device management models, enterprises will find professional services offerings, which can include help desk operations, device warehousing/fulfillment/replacement services, and application development and mobilization services.

The market for wireless TEM and device management services is quite fragmented. Most enterprises are doing it themselves — manually in most cases, or with software packages operating inside of the firewall. The explosive growth by the customer base in units and applications has mapped a strong path for these enterprise software vendors. Simply, as the problem gets bigger, more are looking to outsource the problem. As a result, many enterprise software vendors are exploring hosting and ASP models to make these services easier for small and medium-sized enterprises and for larger enterprises with a penchant for outsourcing non-core functionality.

Dominant players have to enter the ring. Despite the presence of some big players (Nokia and Sybase, for example) already operational, the truly largest cellular providers and global system integrators are still fleshing out their intentions and products.

Several wireless carriers have launched products and services down these lines. Sprint, for example, offers managed device services and managed TEM services on a per-phone monthly charge basis (about $10 or less for each of these services) and has mainly found success among smaller enterprises looking for help in these areas.

Verizon has launched a wireless/wireline TEM service, using some assets from the former MCI with a focus on extremely large enterprises, those spending about $80 to $100 million annually. A few other carriers have dipped their toe into the market with some initial success, but for the most part, the market remains an open field for someone to harvest.

Verizon reports that more than 50 highly qualified accounts are in the sales process. “Up to now, these enterprises have had to either staff up immensely internally to try to deal with this problem or turn over their $100M account to a small TEM firm that scarcely has a few million of revenues on its own,” said Cliff Cibelli, product manager for Verizon's TEM offering. “Well, the lack of really any large player in the market to date shows that the real decent-sized accounts are simply not going to do that.”

In the next six months, TeleChoice expects that service providers to formalize their offerings more and announce some big wins, in the U.S. and abroad. The fact that some carrier groups will police the contracts of other carriers will make this interesting. Expect some of the larger integrators to make a play on a global basis. With enterprises willing to spend up to 1% or more of its monthly spend on TEM and other services, the revenues in this space can add up quickly.

More important for those carriers that are positioning themselves in this space, it will create long-term bonding opportunities as focus shifts from expense management to applications-oriented consulting. It is these applications that will truly electronically bond the customers to the carriers for long-term growth together. In this sense, TEM is a means to a long-term end of reduced churn.

As such, it's not the first time that a service provider has used the lure of guaranteed low cost and consolidated billing services to win and keep accounts. But it may be the first time in the industry that lost phones and cell phones bought at yard sales are driving the market.

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Pat Hurley is director of research at consulting firm TeleChoice, and has written and commented extensively on the wireless market.

WHAT TEM PROVIDES

• Service analysis and contract negotiations

• Device and service fulfillment

• Initial and ongoing rate plan optimization

• Automated invoice management and payment services

• Policy-based usage enforcement (for example, allowing certain services to some users and not to others, on an employee-type or employee-by-employee basis)

• Near real-time alerting and reporting of overages and unauthorized usage

• Customized reporting and analysis on department, individual or functional area bases

• Cross carrier management through a single unified portal

DEVICE AND SERVICE MANAGEMENT OFFERINGS

• Automated over-the-air device configuration for initial device setup and application configuration

• Automated firmware and configuration updates over-the-air

• Remote device backup and restoration

• Password and encryption enforcement on the device

• Mobile VPN

• Device “kill pills” to securely wipe lost or stolen devices (or devices still in the hands of former employees)

• Remote application push to the device and automated configuration

• Automated data synchronization