were only given to the largest of the service providers. This further reduces the margin of advantage once held by the service providers over their customers.
4. Managing Enterprise Networks
For enterprise customers comfortable applying advanced technology, deep packet inspection measurement devices, enforceable SLA’s, and autonomic network control devices allow traffic shaping by the customer to best utilize their network – often a composite network leased from many suppliers and patched together by the enterprise customer. Traffic management by customers means they can lease from providers offering wholesale or no frills networks, further driving down telecom profit margins.
5. New markets for OSS/BSS applications
The expert engineers that end up with enterprise customers typically want to leverage all of their old skills, such as customizing and operating OSS/BSS products. Business customers are now therefore buyers of the OSS and BSS products that before were just used by telecom providers. This means that vendors have a significant new group of customers whose needs must be addressed, which causes the vendor to shift priorities to meet these needs creating, for example, a high priority on network performance monitoring in support of those detailed SLAs. In crossing from Service Providers to Enterprise markets, OSS/BSS application price reductions are likely, but the potential customer base for these agile vendors has grown significantly. So those vendors who can adjust to the enterprise market survive and perhaps flourish. A decade ago HP Openview once navigated this transition and benefited greatly from it. However, OSS/BSS application vendors catering to new enterprise customers reduces the impact telecom service providers can expect to have in driving future product development by the successful vendors.
6. Gaining the inside track
Procurement and test lab experts are also sought after by vendors and enterprise customers seeking the “insider” knowledge of service providers. These insiders can use their knowledge and personal relationships to reduce procurement time or even win a sale that they might usually have difficulty winning. The result could mean a less competitive solution than if the procurement procedures were followed to the letter.
7. Knowledge transfer to competitive service providers
Smaller service providers have also hired from our downsized talent pool. In the ‘90’s CLECs were generally less skilled than the incumbents and at a disadvantage for selling high value products. Today, surviving CLECs know just as much as the big providers. This makes the surviving smaller carriers and regional specialist carriers generally rather successful and therefore attractive takeover targets. One of the benefits the larger carrier seeks out of the merger is the agility and flexibility inherent in smaller companies. Ironically, this puts “returning” employees at an advantage in assignments, raises, and retention over those employees who never left.
8. Disillusioned employees
Many observers have shown that downsizing has lead to a “breaking of the trust” and reduction in the enthusiasm of employees. Being left with “more to do”, coupled with reductions in raises and bonuses, those that are left represent a brooding labor force. They know the company has no loyalty to them, so why should they have loyalty to the company? This makes retaining the best talent tougher. At first, the “more to do” aspect has lead to increases in productivity of telecom companies. But this can only be maintained for so long before exhaustion and the impact of reduced dedication and loyalty begin a counter swing. Fear of losing one’s job is not a good long-term motivator. Eventually, productivity will likely decrease to productivity levels lower than that maintained during the telecom boom.
9. “In sourcing” for Asia Pacific
Another very significant trend is the shifting of skilled and experienced talent to the Asia Pacific region. Before, many strong engineers from the east moved to the USA and Europe to fill the vacancies in the rapidly growing telecom ecosystem. After the downsizing of the USA and Europe, many returned home with state-of-the-art skills and experience.