FUTURE NETWORK REQUIREMENTS

Future Network Requirements

Future Network Requirements

This study identifies the main market areas in the next five years. The study focuses on governance modes for service development of mobile telephone networks (GSM, Wireless Application Protocol (WAP), GPRS, UMTS). 'Services' refer to services containing information. The study shows that the phase of the life cycle of the network and the service affects the choice of governance mode of new service development projects. Governance modes include internal development by the telecom operator, several forms of collaboration between telecom operator and service firm, and only providing a network by the telecom operator to the service firm, which then develops and provides its services (external). In this study a model is developed for the governance mode of service development in different phases of the life cycles of the mobile network and service, based on the degrees of uncertainty and urgency involved in the network and service development processes. Four cases are presented of service development projects for mobile telecom networks.

Services containing information are indispensable for the success of mobile telecommunication networks. Examples of such services are Route Planners and location based restaurant guides. Services for mobile networks are not just modifications of existing Internet services since the value of the use of mobile phones for the customer often depends on the availability of services and their characteristics, such as reference to the present location of the customer. Moreover, the format of the display of the mobile phones does not allow for displaying complete Internet pages. Thus, development work of new, dedicated services is needed.

In many cases it is not attractive for telecom operators to develop these services themselves. They often do not possess the information contained in the service, and many telecom operators are short of cash as a consequence of large investments in UMTS licenses. Recently, many authors have stressed the benefits of outsourcing innovation in general, facilitated by the increased benefits of IT ([Hagel and Singer, 1999 and Quinn, 2000]). On the other hand, outsourcing to independent service firms may create transaction costs for the telecom operator and service firm, particularly under high uncertainty and frequent changes of product design and target application (Bruce, 1995 and Robertson and Langlois, 1995). Moreover, service firms may not be willing to take risks under high uncertainty.

In this study, I advance the view that the most appropriate mode of governance of the service development process depends on the maturity of the network and the maturity of the service. Governance modes include internal development by the telecom operator, several forms of collaboration between telecom operator and service firm, and simply providing a network by the telecom operator to the service firm, which then develops and provides its services (external governance mode). The 'network' refers not only to the physical communication infrastructure, but also to the software infrastructure that facilitates the provision of services on the network. Below, I will argue that for an assessment of the maturity of the network the degree to which a dominant type of ...