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Maturing mobile management outsourcing market offers companies savings and policy enforcement

With the mobile management outsourcing market maturing, companies are looking to cut costs by getting visibility into user behavior and carrier charges.

With the market maturing, mobility management outsourcing is becoming a compelling option for companies looking to cut down on unwanted charges from carriers.

Third-party mobility management services are maturing from managed service to business process outsourcing providers, according to new findings from Gartner.

Some of the leading mobile outsourcing areas, according to Gartner, are sourcing management, ordering and provisioning management, invoice and dispute management, usage and service management, and help desk and customer support.

There is strong interest in outsourcing -- 18% of North American companies are already using managed or hosted mobility services, according to a survey of 369 companies with more than 1,000 employees. The survey, conducted last year by Forrester Research, showed that another 33% are interested in such services. Although 48% of companies said they weren't interested, their reasons aren't what one might suspect.

"The main reason is [that] they don't think they can actually get it," said Brownlee Thomas, principal analyst with Forrester Research. "Or they have not centralized their mobile services. They don't have a corporate plan or contract to manage."

Companies are increasingly looking to outsourcers to help them with contract management and mobile telecom expense and invoice management, Thomas said.

"A lot of companies do this stuff themselves, but when you have three or four or five people who spend all their time or most of their time just managing that, you want to outsource it," she said. "The starting point for most companies [is that] they want help just managing those devices. Then they start to look at invoice management."

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Companies can buy service-level agreements for billing accuracy from their mobile carriers, according to Thomas. "But I'm not going to trust them," she said. "This is why we like neutral third parties, because these specialists will represent me and get it done, and the vendor has no interest."

Cellution, a Rochester, N.Y.-based mobile expense management outsourcer, claims that it can reduce the expenses of its clients by 17% to 21%. The company has software that uses raw data from mobile carriers to track user behavior and to check whether carrier charges comply with their contracts. Cellution CEO Chuck Serapilio said a service like his is necessary because user behavior often costs companies thousands of dollars in unauthorized charges.

"In the corporate world of wireless, Verizon doesn't make a corporate cell phone and then a consumer cell phone," Serapilio said. "It's one cell phone. So as [it's] a corporate-owned device, even though my company owns this device, I can still go online and plug in the phone number and download third-party applications with no approval process whatsoever. And the carrier doesn't stand in the way of it unless you manage it and block it."

Cellution's services allow companies to set policies on usage and costs. A mobility manager can tell his users that the company will pay for the cell phone's regular rate plan and up to 100 text messages a month, for instance. Cellution can track user behavior. Anyone who incurs charges by going outside policy can be made liable for those costs.

"The biggest problem that our clients have had was, 'Yeah, you can look at this and tell us what they're doing, but how are we actually going to manage the process of suspending these phones if people exceed their threshold?' " Serapilio said.

If a client decides to block text messaging on its phones, Cellution can enforce that. When the service provider plugs a raw data dump from the carrier into its database, any text messaging activity is flagged.

"Every time the user goes outside that acceptable rules-based system," Serapilio said, "it gives us a report that here's everybody who is text messaging, here are the people that downloaded third-party applications, and here is what that application is."

If a company has users who have downloaded an ESPN application onto their phones, Cellution can go to those users and tell them they have to remove the application. When the next billing cycle comes around, if that application is still on the phone, the company can terminate the phone.

"I think from what we've seen, everyone uses their cell phones for a lot more than voice now. It's text messaging, it's downloads, video mail, picture mail," Serapilio said. "For most of our clients, the behavior has gone unnoticed. MTV spent on average about $21,000 a month on text messaging, and they spent $10,000 a month on Internet, and that's outside of the approved plan."

Cellution can also handle dispute management with carriers. It can establish contractual policies in advance and then monitor bills from the carrier to make sure the contract is being followed.

"We have a banking customer here in Rochester. Even with all the text messaging blocked, we on a monthly basis still have to go back to Verizon and say, 'Here's $10,000 in text messaging charges that we need to be credited because we identified that all these numbers need to be blocked,' " Serapilio said. "I'm not saying we didn't use the text messaging, but we informed you and worked together to block that so these charges wouldn't incur. You let that happen. Charges incurred. We want that credit."

There are numerous providers of these outsourcing services in the market. Many of them remain somewhat regional, and companies need to be careful when they engage with one of them, Thomas said.

"The problem with these types of companies is if they decide to exit the market, what happens?" she said. "If I get a 30-day notice, which has happened to a couple of very large high-tech clients of mine -- very large high-tech manufacturers -- then all of a sudden they're like, 'Listen, we're not doing this anymore. You've got 30 days to find someone else.' "

It might be worthwhile looking into buying the management software yourself and paying an outsourcer to manage your expenses with the software. Then the customer will own the core software. Third-party providers can then come and go, and the customer can continue managing its mobility.

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