The New York Times has an editorial that plays off the agreement last week between the Federal Communications Commission and the CTIA -The Wireless Association designed to warn subscribers when they are exceeding limits on various cell phone services and applications.
The editorial's goal was to explore the positives and negatives of the agreement and to point out what it suggests is the anti-competitive nature of the wireless landscape. Inadvertently, however, the piece points to something that IT departments, CFOs and others should note from the corporate viewpoint. Consider this:
For years, Verizon Wireless incorrectly billed millions of customers for data access that they did not use. Last year, the company publicly acknowledged the problem and agreed to pay $53 million in refunds and a $25 million settlement with the F.C.C. - after the agency opened an investigation.
The writer's comments were aimed at the consumer sector. It is important to note that the same thing happens on corporate accounts. Moreover, even the consumer realm referenced by the editorial is relevant for businesses, since many let employees expense all or a portion of their individual subscription as they use their personal phone for work.
The bottom line is that the mind-spinning changes in wireless technology and the way in which the devices are used has created an almost-incomprehensible level of confusion. It is abetted, as the editorial points out, by the carriers' strategy of making things as complex and difficult to understand as the system allows.
I am a big proponent of Telecom Expense Management (TEM). It's the corporate equivalent of finding a 10-dollar bill in the pocket of a jacket being taken to the cleaners. In an interview posted at IT Business Edge this week, TEMIA Managing Director Joe Basili told me that the biggest drivers for the discipline right now are the mass transition from wired to wireless networks and the growth of data relative to voice traffic.
Basili outlined expansive areas in which big bucks are being lost. For instance, how many companies are careful to exit services on the wired side as that particular function is taken over by wireless? In most cases, it is likely that focus of the transition is solely on the technology side and implementation sides. Companies end up neglecting ongoing costs and forget to downgrade or eliminate services and platforms the wireless technology is replacing.
Certain things just make intuitive sense. Paying more careful attention to wireless as an element of the corporate structure is one of them. The possible areas to find lots of savings - or to eke out the small gains that add up - are endless. At the end of the day, this goes beyond TEM. A system is necessary in which everything (bills payable, usage statistics, inventory management, wired and wireless telecom traffic stats, mobile device management, mobile contracts and other silos) can be put into the same pot in order to paint a true picture of how much is being spent on telecommunications and how much it costs. That's a long way off. But, once it is in place, the analysis would be a potent negotiating weapon with carriers.
The bottom line is that organizations are spending far more than they need to on telecommunications. The changes are fast, the existing structures are convoluted and the folks charged with following the maze of expenses are too busy doing other things.