ROI Study - Performance & Fault Management saves 25% of a Mobile Operator's Yearly Revenue Spent on Outages & Degradations

I was just reading the Mobile Network Outages & Service Degradations: A Heavy Reading Survey Analysis commissioned by Spirent Communications today. The survey was completed in 2013 initially and then repeated in 2016. It made me think of writing a small article based upon and here it is as my first Linkedin Article :)

The survey report nicely touches how important is maintaining network and service availability as well as application performance and why it is more than ever challenging for mobile operators, especially with the impact of exponential traffic volumes not matched by flat Capex spendings. New world’s diverse and complex applications requiring different service quality within different layers of the networks create challenges on application layer signaling, security policies, synchronization, bandwidth etc. This results in potential degradations, outages and bad user experience more in new world’s networks compared to old world’s ones. 

Looking at the frequency of network outages and degradations in Figure 1, the most successful operators – representing 30 percent of 2016’s total survey sample – are managing to keep the number of incidents to between one and three a year or one every several months. The least successful – representing 34 percent of respondents – report at least 15 incidents a year, or one to two per month.

Comparing 2013 and 2016 survey results in Figure 2 clearly shows that service degradation problem types are more common nowadays; as we discussed the complexity and diversity introduced in the new world’s networks. 

Operators see that the most common outage reasons in Figure 3 are network failures, physical link failures and network congestion/overload, while most common three service degradation reasons are also the same, network congestion/overload takes the highest ranking in that category. 

The report goes into details of most common problematic domains, roaming, Volte, network upgrades as well but I will not touch these here. Please read it if you are interested further.

In Figure 4, survey findings show the costs as a percentage of total revenues spent on network outage and degradations. Heavy Reading estimates that mobile operators spend around $20 billion revenue a year with total mobile service revenues reaching already $1.2 trillion in 2015. This makes it 1.7% of the total revenue to be spent on network outages and degradations.

Based on the Heavy Reading’s survey results, it became a necessity to study on how, as TEOCO, we are able to help more than 300+ service providers globally on saving their revenues. In this particular analysis, I will only be touching our Service assurance solutions while knowing the facts that proper network planning (ASSET), design, configuration (SMARTCM) and optimization (MENTOR & INSIGHT) as well as customer experience management (INSYNC) aspects also play important roles in minimizing network outages and degradations.

Our solution, HELIX, Unified Service Assurance Software Suite, delivers an automated, analytical and proactive approach to service experience management, performance management and fault management. Through simplifying CSP’s operations, supporting the digital transformation it enables quick adoption of new-generation telecommunications services driven by technology advancements such as virtualization, NFV/SDN, 5G and IoT.

HELIX monitors, measures, models and analyzes network and non-network related data, quickly identifying and resolving service and network problems. This significantly improves service quality and availability, while generating actionable insights and reducing operating expenses.

On the ROI side: Based on measured customer project results, HELIX, is able to introduce certain benefits that can speed up diagnosis and introduce prevention for network outage and degradation types listed by Heavy Reading. Depending on problem types, different reduction rates are measured and reported. 

Now, let’s assume that we are saving revenues of a Turkish mobile operator that has 22M mobile subscribers with an ARPU of 7.5 USD. As suggested by Heavy Reading, the operator will spend 1.7% of its total revenue on network outage and degradations. Table 1 summarizes that this operator will be spending 33.66M USD per year on this as below.

Heavy Reading report explains the causes of network outages and degradations per problem type with certain weights and we, as TEOCO, know our HELIX’s capabilities for reduction on the percentage of each problem that correlates to the below scenarios in Table 2:

This illustrates return on investment for performance & fault monitoring system of TEOCO's HELIX with minimum 25% savings on mobile operator’s annual revenues spent on network outages and degradations.

Comments and reviews are more than welcome. Thanks for reading.

Sincerely,

Aydin