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Managed Network Service Multifaceted Apps

In 2007, managed services revenue has increased noticeably -- illustrating an elevated role for these services and validating forecasts presented in the ABI Research study entitled "Managed Services for Mobile Networks."

A large portion of future wireless hardware sales could well become a part of managed services agreements, as capacity management needs and other similar factors come into play.

Managed network services provide a large and growing opportunity for mobile communications service providers to offload network operation tasks to third parties. Additionally, these services allow infrastructure equipment vendors to secure new revenue streams.

"Service providers are under pressure from several directions in 2007," says research director Lance Wilson. "They must focus as never before on maximizing profits and reducing costs, rather than just recruiting as many new subscribers as possible."

Operators are analyzing their business management and operations, realizing that competent external managed services providers can boost efficiency and correct problems regarding network operation, capacity and technology issues, and content. Because of this improvement, cost savings and smoother system operation will arise as well.

"In practice, managed services vendors primarily are the major wireless infrastructure equipment vendors," says Wilson. "This is logical, as they already have close relationships with service operators; they have deep pockets which are needed to succeed in this field; and they have always offered services relating to their own equipment installation and maintenance. Finally, they enjoy economies of scale because they may offer the same services to many different operators."

I believe that the definition of managed services within the wireless realm will evolve, in a very similar way that occurred within the wireline sector. Managed services were originally focused exclusively on transport infrastructure operations for basic network related services.

However, the term now incorporates other value-added applications -- in particular, content delivery networks (which typically includes content storage and distribution). I believe that expertise in building and managing networks optimized for multimedia -- both consumer and enterprise customer -- applications will experience the most rapid increase in demand.

In the near future, I anticipate that we will witness innovative multifaceted managed service offerings that utilize creative combinations of Anycast and VPN schemes that are applied to make the optimal use of shared network infrastructure for a multitude of divergent client applications.

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