By Eric Troyer (Part 3 in a 4-part series)
“Mobility centers”-that is, dynamic ecosystems of service sellers and buyers that span the entire mobile value chain-offer MNOs significant efficiencies in cost and operations.
Neutrality and Direct Connections
As a neutral host to multiple IP service providers, the hub enables MNOs to connect directly-peer-with the major traffic sources instead of purchasing IP transit. Access to multiple service providers also translates into a highly competitive IP transit marketplace, where MNOs have the opportunity to negotiate better rates. Direct access, accomplished with a simple cross-connect or Exchange Platform inside the hub, also delivers unprecedented speed in provisioning new access, reducing operational and lost opportunity costs.
Roaming and Interoperability
The hub can also provide direct access to an array of roaming, interoperability and messaging service enablers and providers. Direct access ensures greater uptime and availability of these core MNO revenue generators.
Colocating Applications and Services
Amazon’s sales via mobile devices topped $1 billion in 2010, and Facebook’s 425 million active mobile users are twice as active as non-mobile users-encouraging more than 200 mobile operators in 60 countries to work to deploy and promote Facebook mobile products. Instead of hosting their applications and services in expensive, remote data centers, MNOs can drive down costs and improve performance and customer satisfaction by consolidating their data centers into fewer mobility centers and centralizing their applications, content and services there. When the hubs are located in major metropolitan areas, MNOs can also reduce their operational costs for managing their data centers while increasing application performance.
Reducing Overall Network Traffic
Instead of overpaying for additional capacity to expand an inefficiently architected network, mobility centers enable MNOs to reduce overall network traffic on the backbone by locating applications near high customer densities and connecting directly to the top mobile traffic destinations. For example, instead of using the backbone to take traffic generated in Chicago to an application that terminates in Seattle, the MNO can colocate the application in Chicago and reduce the backbone load. Similarly, with direct connections to sites like Facebook and Twitter within the hub, mobile customers in high-density areas can access a local instance of these sites faster and further reduce the backbone load.
Backbone Service Procurement
When it does become necessary to purchase additional backbone services to connect regional markets, mobility centers provide MNOs with a competitive marketplace where they can aggregate their purchasing to drive down costs and reduce provisioning time, reducing operational and lost opportunity costs. They can also select between multiple providers to optimize cost and performance. Various network architectures lead to different topologies with varying impacts on redundancy, latency, and cost. Having more options enables MNOs to pick the network that works best for their specific requirements.
Mobile Backhaul Procurement
Time Warner Cable’s mobile backhaul business grew by more than 300 percent in 2009 with analysts predicting total sales will reach $3.6 billion in 2012. Mobile backhaul is often an Ethernet service, and mobility centers offer the possibility of creating an Ethernet exchange, a competitive marketplace where MNOs can aggregate purchasing, purchase and provision capacity in near real-time, and reduce operational and lost opportunity costs.
In addition to driving down network and operational costs, mobility centers offer MNOs a significant performance advantage over an inefficient architecture built using a single provider. The flat, distributed architecture-based on peering and direct interconnections-is similar to the way the Internet works today and enables MNOs to localize traffic, creating the shortest distance between users and destinations, and offloading traffic from the MNO’s network as quickly as possible.
This performance advantage delivers two critical benefits. First, because it enables MNOs to scale more cost-effectively, they can scale to keep pace with demand, dramatically accelerating and increasing return on investment. Second, better performance translates directly into a better customer experience, and customers reward a positive experience with increased loyalty.
Coming up in Part 4: Enabling the Mobile Ecosystem – Platform Equinix