Hot Topic— Mobile Enterprise Services in
Latin America
Value-Added Services and Mobile Applications Lead to Market
Growth
9838-65
November 2013
Executive Summary
Embratel
Renato Pasquini
Telecom Industry Manager
ICT Latin America
(+5511) 3065-8433
[email protected]
Research Manager
Research Director
Jose Roberto Mavignier
Business Unit Leader
ICT Latin America
(+5511) 3065-8463
[email protected]
Research Team
Carina Gonçalves
Research Analyst
ICT Latin America
(+5511) 3065-8427
[email protected]
Contents
Section
Slide Numbers
Executive Summary
4
Introduction
7
Key Definitions
9
Market Assessment
11
Brazil Breakdown
26
Appendix
28
Key Study Findings
•
Mobile enterprise value-added services (VAS) are in the radar of information and communication
technologies (ICT) companies, as one of the most promising revenue streams in the next years.
•
VAS such as location-based services, Voice VPN, mobile office, mobile cloud computing,
application-to-peer (A2P), short message service (SMS) and others are being improved and expanded in order to
increase average revenue per line (ARPL) and improve customer experience.
•
Telcos want to offer integrated solutions in order to optimize the adoption of mobile enterprise services
by small, medium and large businesses. These solutions also drive an increase of data services and
voice services of carriers’ infrastructure, thus providing a base to preserve the traditional telecom
business.
•
The ecosystem in Latin America is being developed and the availability of different mobile applications
is expected to increase heavily in the next years. Companies are likely to adopt applications under
mobile device management (MDM) solutions, in order to guarantee security, and deal with the
phenomenon of consumerization, as personal smart device adoption in enterprises keeps growing.
Key Study Findings
• Frost & Sullivan estimates that the mobile enterprise services market revenue for Brazil, Colombia and Mexico, will grow from U.S. $ 11.84 billion in 2012 to U.S. $ 17.84 billion in 2018.
• However, many solutions are still tailor-made for special projects. For further adoption, it is important that ―shelf products‖ are provided by Telcos with easy contract options by clients, as a few Telcos have been doing with cloud services
applications stores.
• We expect that with the evolution of 4G networks and Wi-Fi hotspots, the experience with cloud services will enhance and this will allow the development of more advanced services, including video.
• For the client, the return on investment needs to be calculated in large projects. However, the ―as a service‖ model provides an easy access for small and medium enterprises to adopt applications and services. The evolution of this model is resulting in an increase of productivity and efficiency in this segment, as users make real-time decisions; even if they are away from their physical locations, they still have access to systems that allow better management of
operations, such as CRM, Accounting, Supply Chain Management, etc.
• However, there is still lack of awareness of the benefits that enterprise mobile solutions can deliver. Therefore the challenge is to educate customers and make the service more tangible. Other key industry barriers that need to be addressed are consumer trust on security, and low penetration of data-capable devices.
Research Objectives, Scope, and Methodology
Objectives:
This study focuses on analyzing what mobile carriers are doing regarding mobile enterprise
services. The key focus areas of the research are as follows:
• Main trends for mobile enterprise
• Market assessment and forecast
• Types of services by carriers
Scope
•
Geographic coverage: Brazil, Colombia and Mexico
•
Forecast period: 2013–2018
•
Base year: 2012
•
Monetary units: US dollars
Research methodology
Primary research was conducted, and secondary research included Frost & sullivan
online database, market participants’ financial reports, and regulators’ Web sites.
Source: Frost & Sullivan
Mexico
Colombia
Source: Frost & Sullivan
Key Definitions
Mobile Enterprise Services: Multiple components—including plans, devices, operating systems, applications, access options, and corporate policies. This is the comprehensive set of tools and processes an enterprise uses to manage its mobility
environment.
Mobile Value-added Services (VAS): VAS are enhanced services, which add value to the basic telecommunications services and bearer services for which separate licenses are issued.
Location-based Services (LBSs): LBS offer organizations the ability to identify and track locations, goods, and services in the form of directions, or maps and GPS coordination. It also provides location-based time cards, which give the duration of the stay of an employee at a particular location. These services are used in fleet management and vehicle location services, as well as in environments that have mobile equipment.
Supply Chain Management (SCM): Supply chain management helps with efficient logistics tracking and planning. The advantages include: mobile dispatch, mobile order tracking, package tracking, instant messaging, on-the-spot mobile printers, exception alerts, virtual real-time vehicle tracking, and the integration of various data collection devices, for example, barcode, RFID (radio frequency identification), electronic signatures, and so on.
Field Force Automation (FFA): Timely communication and coordination, both inbound and outbound, to the field are critical for FFA. It enables workflow processes, service scheduling, status reporting, remote data entry, and a host of other benefits.
Mobile sales force automation (SFA): involves the extension of corporate customer relationship management (CRM)/SFA systems to mobile devices. This often allows itinerant, field sales personnel to access product information, pricing, inventory status, and customer information on mobile devices enabling users to perform contact management, calendar entries, opportunity
Mobile Enterprise Services—Market Assessment
Source: Frost & Sullivan
Key Takeaway: Mobile enterprise value-added services (VAS) are in the radar of information and
communication technologies (ICT) companies, as one of the most promising revenue streams in the
next years.
VAS such as location-based services, Voice VPN, mobile office, mobile cloud computing, application-to-peer (A2P), short message service (SMS) and others are being improved and expanded in order to increase average revenue per line (ARPL) and improve customer experience.
Telcos want to offer integrated solutions in order to optimize the adoption of mobile enterprise services by small, medium and large businesses. These solutions also drive an increase of data services and voice services of carriers’ infrastructure, thus providing a base to preserve the traditional telecom business.
Key Takeaway: The evolution of smarter devices with a high level of computing capability is now
widespread. These devices can replace laptops on the field and travelling. Enterprises have slowly
started to realize the value of integrating these devices into their communications.
Mobile Enterprise Services—Market Assessment
Key Market Drivers
Smart device uptake and adoption of personal devices in enterprises is
expected.
Increased productivity and collaboration with field and remote
employees are essential.
Managed mobility services are likely to spur the uptake of mobility solutions.
Alternative revenue stream for network operators is expected to boost growth.
1
2
3
4
0 5 10 15 20 25 302012 2013 2014 Tablets 2,1 4,2 6,7 Notebooks 13,1 16,8 20,4 Smartphones 15,5 21,4 27,8
Unit s (M il li on)
Devices Forecast, Brazil, 2012–2014 Tablets CAGR, 2012–2014 = 78.6% Notebooks CAGR, 2012–2014 = 24.8% Smartphones CAGR, 2012–2014 = 33.9%
Tablets in Brazil are expected to grow almost 80% by 2014.
Source: Frost & Sullivan
Key Takeaway: Some prospects still not recognize the advantages of mobile enterprise services.
Therefore the challenge is to make the service tangible, adding value to the customer. Education also
is essential for the usage of mobile enterprise services.
Mobile Enterprise Services—Market Assessment
Key Market Restraints
End-user unawareness of the benefits of mobile solutions
Quality of service of mobile broadband networks
Affordability of mobile solutions
End-user concerns on the security of solutions
Low penetration of smart devices
This mindset is more prevalent among conservative vertical segments—for example,
the financial services sector—where security and other compliance issues are critical to
business operations.
Access is not the only security concern; corporations also have begun to realize that any
data that is downloaded or sent as an email attachment can be vulnerable if the device is lost
or stolen.
1
2
3
4
5
Unimportant Critical Very Uncertain Very Certain High Impact Size Medium Low
Impact Mapping of Drivers and Restraints
Driver Rank
1
2
3
4
Restraint Rank1
2
3
4
3
4
1
4
1
2
5
3
2
3
4
5
Source: Frost & Sullivan Legend:
Blue: 1) Smart device uptake 2) Increased productivity 3) Managed mobility services 4) Alternative revenue stream
Mobile Enterprise Services in Brazil, Colombia and
Mexico
Key Takeaway: The mobile enterprise services market penetration has encouragingly and steadily
increased, but there is still potential for growth considering the economic outlook and enterprise
market demand.
0,0 10,0 20,0 30,0 40,0 50,0 60,0 70,0 0,00 2,00 4,00 6,00 8,00 10,00 12,00 14,00 16,00 18,00 20,002012 2013 2014 2015 2016 2017 2018 Revenue ($ B) 11,84 12,96 14,00 15,01 15,95 16,90 17,84 Lines (M) 35,1 39,2 43,7 48,7 54,1 59,9 66,4
Lin
es
(
Mill
ion
)
R
ev
enu
e
($
B
illi
on
)
Year
Mobile Enterprise Services Market: Lines and Revenue Forecast,
Brazil+Colombia+Mexico, 2012–2018
Revenue CAGR = 7.1 Lines CAGR = 11.2%
Source: Frost & Sullivan
Key Takeaway: The opportunities are immense in the enterprise mobility market segment. Service
providers and vendors that can build an end-to-end ecosystem to address the challenges will be well
placed to thrive in this market.
Mobile Enterprise Services—Market Assessment
• Mobile Device Management (MDM) • Mobile Application Management (MAM) • Network Security
• Access Security • Device Security • Fleet Management
• Telecom Expense Management (TEM) • Service Management
• Maintenance Management
Key Applications
Enterprise Mobility is starting to take center stage in many organizations and is clearly on the minds of Information
Technology (TI) managers and Chiefs Information Officer (CIOs). Enterprise Mobility is far greater than just management of mobile devices. Many other aspects also need to be considered like applications management and the
security issues surrounding mobility. Consequently organizations must balance the expectations of employees in
pursuing an enterprise mobility strategy whilst at the same time putting in place adequate governance and security
Lifecycle Stages of Key Services/Applications
Convergent
services
Mobile
Broadband
Cloud
services
Mobile VoIP
M-Health
M2M
Source: Frost & Sullivan analysis
Currently accounts for a small portion of operator’s revenues, but M2M solutions are considered to offer very high growth potential.
Maturity
Development Growth Decline
Time
M
ar
ke
t
V
al
u
e
Mobile broadband is expected to be one of the fastest developing services.
Unified
Communication
Video
conferencing
Business E-mail and
Mobile Office
Content
Voice
Reduced labor expense, increase in customer satisfaction and reduced paperwork are the top ROI impact of these
applications.
Integration of smart devices into the workplace will drive adoption of mobile applications and Software as a Service.
SFA
LBS
Mobile Device
Management
System
Apps
(CRM,
SCM, ERP)
Mobile Enterprise Services Market: Life Cycle Stages of Key Services/Applications (Latin America), 2013
SMS
SCM
FFA
Point-of-Sale (POS)
application
Mobile Enterprise Services—Market Assessment
Source: Frost & Sullivan
Key Takeaway: Applications are likely to be flexible in terms of OS platforms and infrastructures.
Currently the majority of the mobile enterprise solutions have
custom design based on the customer business requirement.
There a few shelf products available and these services
also need to be adapted for implementation depending on
the client infrastructure.
Most operators use development partners. In this
case, the customer should contact the own partner if it has software problems. If happens a
hardware or information transmission problem, the
partner will contact the manufacturer or the operator itself. The advantage of been a Telco customer is that mobility is
its core business and it can develop customized solutions with all the knowledge required
Mobile Enterprise Services—Market Assessment
Source: Frost & Sullivan
Key Takeaway: Growth in virtualization and cloud computing drives ease of implementing mobile
enterprise solutions.
Cloud solutions is a trend in this segment because they
offer the possibility to contract application in the ―as a
service model‖. But these solutions are vulnerable to the
bandwidth and availability of mobile networks. Currently
it´s more popular the hybrid model in which an application
on the device sends the data in the end of a request.
Source: Carriers´s websites. Frost & Sullivan
Key Takeaway: For the client, the payback is fast and the ROI is high because of the cost
reduction applications could bring. Mobile enterprise services also bring optimization of the
information flow and productivity.
Mobile Enterprise Services—Market Assessment
CUSTOMER VALUE
• Increased productivity.
• Enhanced communication in the organization. • Reduced paperwork.
• Improved reliability and quality of information. • Increased speed in information updates. • Better relationships and client service. • Possibility of real-time decision making.
• Reduced errors, with standardization and registration, having no problems with re-keying and other communication errors.
• Reduced need for voice communication because the content is carried via data transmission.
• Monitoring of risky operations (e.g. transport of money). • Prevention of loss of revenue due to lack of connectivity.
• Integration with Enterprise Resource Planning (ERP) solutions, Customer Relationship Management (CRM) and others.
• Greater control of the operation created by the visibility with periodic reports of the service running.
• Economy, because is not necessary to invest in servers, hardware or integration. The manager just need to enable the devices and manage everything online.
Mobile Enterprise Services—Market Assessment
Source: Frost & Sullivan
Key Takeaway: Mobile enterprise solutions provide the best working tools for service companies that
require security, availability, ease of implementation, cost and time savings.
TARGET MARKET
Healthcare
Industrial
Safety and Emergency
Consumer and Home
Retail and Finance
Transportation
• Transport companies with high-value loads. • Point of sale and
logistics companies.
• Corporations that require security for its executives. • Private security firms. • Trade marketing
sector. • Promotional
marketing agencies. • Event companies
• Corporate management focused on products that rely on excessive control.
• Companies with sales force.
• Corporate staff with strong mobility. • Management companies with products
and services of high consumption. • Companies that practice remote
monitoring and assistance.
• Supermarkets, drugstores, department stores. • Consumables companies (food, clothing, etc.).
Mobile Enterprise Services in Brazil
Key Takeaway: Lines are expected to grow at a much faster rate than ARPLs. This is mainly due to the
rapid expansion of M2M services, which have a very low ARPL, usually lower than $5.00.
0,0 10,0 20,0 30,0 40,0 50,0 60,0 0,00 2,00 4,00 6,00 8,00 10,00 12,00
2012 2013 2014 2015 2016 2017 2018 Revenue ($ B) 6,35 6,98 7,56 8,13 8,66 9,22 9,77 Lines (M) 23,4 26,3 29,7 33,6 37,8 42,5 47,7
Lin
es
(
Mill
ion
)
R
ev
enue
($
Bi
lli
on
)
Year
Mobile Enterprise Services Market: Lines and Revenue Forecast,
Brazil, 2012–2018
Revenue CAGR = 7.4%, Lines CAGR = 12.6%
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