With operators beginning to roll out solutions and M&A activity starting up again in the mobile device management sector, ABRAHAM JOSEPH looks at where the sector might be heading over the next year.
An earlier version of this article entitled “Focus on the Phone” was published in 3GSM World Focus in February 2006.
Mobile Device Management – Brave New Horizon or Basic Plumbing?
By Abraham Joseph – V2.0
Mobile device management (MDM) was as one of the hottest topics in the telecoms industry in 2005. November was particularly noteworthy because within a two-week window, Nokia announced its intention to acquire Intellisync, Telefonica Moviles unveiled its MDM strategy and Vodafone UK announced its own brand of email service that included device management (DM) based on mFormation’s platform, as a no-cost feature on some tariffs. The excitement continued in January when mFormation announced its intention to acquire the device management business of Aepona and in February when i-mate entered the market with its suite of device management products aimed at enterprises. After a few months’ recess, M&A was back in the headlines again when Sicap announced its intention to acquire Swapcom in August. With a number of players stating that they are looking to grow by acquisition and VCs showing increasing interest in the sector, M&A activity seems set to continue through 2006 and 2007. The basic premise of MDM is simple: for a network operator, an effective MDM solution will increase revenues by ensuring that mobile devices, particularly smartphones are properly configured for services and it will cut costs by reducing the number and duration of customer service calls. It will also enable problem diagnosis, fault fixing, and upgrades to be performed with devices still in users’ possession. Prem Athwal, VP of marketing at SmartTrust suggests, “For a mobile network operator in a mature market with 15 million subscribers, the combined monetary impact will be in the region of €20m positive on an annual basis.” For enterprises, an equally compelling case can be made: MDM will enhances operational efficiency and reduce costs and risks associated with the use of mobile devices. “MDM is a key area for our enterprise customers because of the importance of protecting corporate data and minimising risks of unauthorised access to corporate systems,” says Alex Reeve, director of mobility solution, EMEA at Microsoft. “As mobile phones become more complex, you get the same issues as PCs,” says Pekke Issasompi, communications manager, Europe within Nokia’s enterprise group. “Costs get very high if you don’t have good procedures in place. MDM helps take care of such procedures and enables rational deployment of fleets of devices.” Not everyone agrees on what MDM entails. Mark Edwards, CEO of mFormation offers one of the broadest definitions: “MDM is everything that is required to ease and enhance the customer experience including ensuring the device is properly configured, managed, supported, secured and updated.” Several other factors have helped to promote MDM to the top of the agenda. They include:
- Vendors facing huge costs from recalls of buggy devices
- Enterprises deploying an increasing number of mobile applications and needing tools to manage and protect populations
- Enterprises becoming increasingly concerned about information security breaches due to employees’ use of mobile devices
- New technologies from a number of start-ups targeting MDM
- Progress on standardising some aspects of MDM
- M&A activity in DM and systems management
Dr. Tacis Govoyannis worldwide head, Taylor Nelson Sofres suggests, “We are also entering the new era where viruses are already making their way to the mobile devices especially the MS office enabled ones and it will not be long before we see similar attacks on mobile devices to those we have seen on PCs.” He agrees that MDM will also gain favour with many operators. “We found from our research that globally some 40% of the consumers we asked indicated that they would like to use music more in the future and some 10% of those had the capability but had not used it. Moving on to more complex applications such as TV to mobile this (proportion) rises to some 60%.”
MDM in the Network Operator/Service Provider Environment
It is clear from Vodafone UK’s approach that this operator sees MDM mainly as a support technology. “Going back many years, we’ve been asked by a large number of our customers to provide email,” says John Lillistone, head of enterprise data servers, Vodafone, UK.“We started with Blackberry and were very successful. We are seeing still a huge level of demand for email, for services beyond email and for email on a wider range of handsets”. This, he suggests is what lead to the launch of the Vodafone branded email service. Regarding MDM, he suggests, “With these increasingly complex devices that are running email and a whole range of other applications, it is very easy to make an error in the settings, and they can be quite challenging for both large and small organisation to manage when they are out in the field”. Vodafone UK’s solution enables remote checking and updating of device settings, as well as remote locking and wiping. At the time of writing (early December 2005), it was not clear whether other companies in the Vodafone group would follow the UK ‘s positioning and pricing of MDM. However the company confirmed that mFormation’s platform was selected for MDM at group level. Although a number of other operators including Swisscom, Sprint PCS and KDDI have deployed MDM solutions, widespread deployment will take some time. “The rollout of MDM in the operator world will take three to four years,” says Carsten Brinkschulte, CEO of Synchronica. “In the mean time device manufacturers will implement solutions to cover the gap because when users have problems, some call the operator and some call the device vendor.” Yoram Salinger, CEO of Red Bend agrees that MDM will take a number of years to roll out and suggests that it will not be long before basic MDM capabilities become commoditised. “I believe that the true value will be in the ability to manipulate software on standard devices to suit the needs of individual users”, he says.
Operators’ MDM Platform Decision Criteria
With many MDM solution vendors targeting mobile network operators, it is useful to examine the key criteria by which operators are choosing their MDM platform vendor. “Among our key criteria of vendor choice, are the need for flexible modular architectures and the alignment of the vendor’s roadmap with Vodafone’s strategy”, says Idris Issa, head of device services development within Vodafone’s global service platforms group. He goes on to explain that good workflow and FOTA (firmware over the air) capabilities are important and that in addition to opex reduction and new service facilitation, he sees MDM as playing a key role in brand protection. For Telefonica Moviles Espanña, the primary drivers for MDM are reducing customer care costs, eliminating barriers to consumption for value added services and having a generic management interface for future as well as current mobile devices. Among the carrier’s key criteria for vendor choice are commitment to standards, architecture flexibility and openness. The company suggests also that vendors should pay attention to issues of interoperability, user experience and security, and that solutions should be friendly, transparent, and above all usable. For Swisscom, whose definition of MDM includes inventory and whole life cycle management, the key drivers for MDM are customer satisfaction improvement and cost reduction. “Our key criteria for vendor choice include the range of features offered, the size and experience of the vendor and the ability of the solution to manage a huge variety of devices,” says Lucas Fluri, head of technical terminal management. In the GSM world, many operators view the SIM as the only secure component in the mobile device. SmartTrust, whose heritage is in SIM management sees the capability as critical to MDM. “Any MDM solution worth its salt must have the ability to manage both the handset and the SIM simultaneously,” says Athwal. “When a subscriber changes handset, he or she will insert the old SIM into the new handset. An effective MDM solution must be able to detect and ‘follow’ this change and restore all necessary settings to match the characteristics of the new handset.” Looking towards 3G and some of the requirements QUALCOMM is seeing, Anthony Sheehan, director of business development, EMEA says, “What is changing is that there is increasing demand for proactive and independent management of device and application life cycles. Operators want to plan for application deployment and don’t want to delay until a particular application is ready.” MDM in the Enterprise Enterprises can take several approaches to solve their DM problems. These include developing solutions themselves, enlisting the help of a system integrator and opting for a managed service.
Many enterprises already have comprehensive IT management solutions in place, including tools for managing some mobile devices such as laptops. An important question, however, is whether such systems can (or ought to) be extended to manage new mobile devices such as smartphones. Large IT infrastructure vendors view such an extension as logical and most can deliver ‘complete’ solutions albeit with the aid of smaller players such as FOTA specialists in some cases.
Another key question is who is best placed to serve the MDM needs of enterprises. IT infrastructure vendors like IBM, HP, Computer Associates (CA) and SUN Microsystems might be logical choices, but so might Nokia, Vodafone and Telefonica. Olivier Poulain, mobile solution business manager within HP’s worldwide network and service providers business unit offers an interesting perspective. “While national corporations will typically turn to the operator for managed solutions, multinationals will probably turn to HP or other large outsourcing companies because even large operators do not have the global reach to service all their requirements,” he says. “I have seen RFPs from financial institutions requiring support in over 200 countries. No single operator can meet these requirements.” He points out that HP delivers solutions to operators and works with them to address enterprise requirements.
Operators face other major challenges in the large enterprise market too: not only might they find the large IT and outsourcing vendors already entrenched, but the latter are often better able to address the range of issues relating to governance, compliance and business processes that typically drive IT infrastructure investment decisions. Operators may find it equally challenging at the opposite end of the spectrum. In the SME segment a number of smaller players such as UK’s Exative and Cognito and Norway’s IT Senternet and Smartsync are already offering services and support that are broader and deeper than many operators will contemplate in the short term. Additionally some of these smaller players offer significant industry sector specialisations.
Questioning the value of the network operator in the loop
A key question that arises then is what exactly is the value of the operator in the device management value chain? At first sight operators’ roles seem assured, after all, they are needed for connectivity. However a new group or players exemplified by MCTel, TynTec and others that have independent signalling and routing infrastructures are anxiously eyeing the MDM market and offer a tantalising proposition to enterprises and third parties interested in offering managed services: route management traffic over their infrastructure and that way (CDMA-GSM signalling challenges aside) devices can be managed wherever they are in the world, and more importantly, independent of the networks on which they reside.
Architectures for MDM
According to Ekaw Nelson, managing consultant for wireless e-business within IBM’s global services business unit in EMEA, the logical place for MDM is within an organisation’s systems management framework. “At some point the CFO is going to ask why he or she should have to invest in two separate systems for backup and restore.” Nelson argues also that the logic for service oriented architecture is compelling. “There are many components within a vertical application that an organisation will want to reuse, therefore disaggregating the whole into a set of callable services makes sense.” In such an architecture, he suggests, the location of an individual service does not matter and the organisation can outsource services where it makes sense. “FOTA, client provisioning, and diagnostics should all be callable services available to appropriate applications,” he says. At its user group conference in November, CA announced its new strategy for unifying enterprise IT management and CTO Yogesh Gupta and Marc Camm, VP of smartphone solution, demonstrated a new smartphone manager application CA is developing. “The control of information on the handheld device, the detection of rogue access points, the optimization of throughput and end-user response time will all need to be managed and secured through a policy-based system,” says Yogesh Gupta. Microsoft’s Reeve suggests, “We see two major trends in mobile device management within the enterprise: enterprises looking for software infrastructures to help them manage problems and enterprises consolidating their mobility platforms to one or two.”
Enterprise Benefits from MDM
For McDonald’s which has a sophisticated business process to ensure its restaurants adhere to stringent performance metrics relating to quality, service and cleanliness, the benefits of MDM was obvious. “We used the remote management system to de-install the old version of software and install the new version. The savings we made were enough to cover the cost of the system.” says Keith Frimley, business relationship manager, McDonald’s, UK. The company chose MDM and security solutions from Sybase’s Ianywhere subsidiary. For Addison Lee, a London-based passenger transportation company, the challenge was to grow beyond 200 vehicles. “We knew we needed IT innovation and we could have done it ourselves, but in the end we chose a managed solution from Cognito,” says Peter Ingram, IT Director. The company now operates 1,500 vehicles. MDM in the Channel Major distributors have been among the earliest to require tools for changing device settings. “We buy and sell 10m phones a year and we need to open 80% of the boxes going through our facilities in order to perform some form of reconfiguration or update to the devices,” says Michaél Køehn Milland, COO of distributor Dangaard Telecom. “We operate in 15 countries and have our own logistics in each market because we find that this is the best way to be responsive to the customer. In Norway for example, customers are ordering devices with specific hardware and software customisation for delivery within 2 hours.” Dangaard Telecom demonstrates the major role a channel player can have in the marketing of services. “We have an installation in Denmark for which we pre-configure devices with fifteen applications before they are shipped,” says Millard. “The user is allowed to try the application one or more times before being prompted to buy it via premium SMS.” Future MDM Challenges Today’s discussions are primarily about PDAs and mobile phones, but with cameras, music players, games consoles, and storage devices becoming increasingly capable and network-enabled, they as well as other devices that offer similar opportunities for service delivery or similar risks of information security breaches ought to qualify. Additionally, with processing power and storage getting cheaper, network-capable computing will become available in a wider range of accessories, apparel and modes of transport. New capabilities such as lock and wipe in Windows Mobile, embedded feature delivery from Red Bend, OMA DM clients on handsets, context-aware distributed synchronisation from Appear Networks, and scripting language for helpdesk automation from Synchronica will create many opportunities for innovation in solutions and services. Competition is fierce, but MDM is at an embryonic stage so service positioning and pricing issues will continue to challenge players. Dangaard’s Millard suggests, “One of the biggest challenges the industry faces is to create business models around MDM where everyone can participate and get their fair share”.
MDM in context
MDM is necessary to deliver and maintain good service quality for users and for service providers and enterprises to deploy, manage and secure populations of mobile devices efficiently. Vodafone UK made an interesting move in positioning its MDM service. This challenges not only those hoping to sell MDM solutions to enterprises, but also many others that were hoping to provide managed MDM services. Whether this proves to be a shrewd move remains to be seen. Similarly Nokia’s moves seem equally bold. Not only has the company paid a handsome price for Intellisync, but it appears to be linking the various components to build compelling propositions for the enterprise market. At the same time the company is building its retail presence. Given the importance the company appears to attach to device management (most likely due to the help it offers in relation to brand protection), it may not be long before the company starts offering device management services direct to consumers. As far as the independent software vendors are concerned, many of them are targeting operators and many do not have broad enough solution sets to enable operators to address enterprise opportunities nor do they have experience in the enterprise market. mFormation and Synchronica are notable exceptions. So was Intellisync, and this proved irresistible to Nokia. In the long term we will probably see MDM as plumbing, but in the mean while, it is a crucially important area for operators and vendors as well as for the enterprises and consumers they serve.
Abraham Joseph is Founder of the Device Management Forum and Managing Partner of Inteligentis, a UK based research and consulting company. You can contact him at