Network equipment providers (NEPs) face unique challenges like falling margins and increased competition. They need to up their game, work closely with carriers (service providers) and be a one-stop shop for their needs. Partnering with an experienced IT services firm can help them move up the value chain.

1. Network Transformation:Opportunities and Challenges for Equipment Providers (NEPs) Cognizant Research Center | August 2011

3. Declining average revenue per user (ARPU) in the wireless voice area

4. Increasing competition from non-traditional players — mobile virtual network operators (MVNOs) and over-the-top (OTT) providers such as Skype, Yahoo and Google

5. Growing technology complexity

6. Mounting mobile broadband customer base

7. Increasing customer demands for ubiquitous and customized services

9. Legacy OSS/BSS systems hinder the quick roll-out of new services as they need to be configured and tested rigorously

10. Deploying new OSS/ BSS systems creates a complex environment with several multi-vendor systems (hardware and software) that operate in silos, each silo supporting only a subset of services

12. enable rapid provisioning of new services

13. work closely with them and develop customized, scalable end-to-end solutions

14. accommodate new solutions with minimum integration issues as they move toward an all-IP environment.This provides an opportunity for NEPs, the closest and biggest vendors to CSPs, to strengthen their strategic partnerships with CSPs.

16. Competitive pricing as a result of emergence of low-cost players from Asia

17. Higher bargaining power of CSPs resulting in reduced margins

20. focus on OSS/BSS sub-segments that are expected to grow more rapidly such as performance management, provisioning and service activation and inventory management

22. CSPs generally prefer big IT services firms for high-level OSS/BSS transformation

23. Big IT services firms have considerable experience in building and delivering new and more cost-effective IT and business capabilities.

24. Crowded Market Place

26. Enhance product portfolio by acquiring companies possessing capabilities in systems integration and software development

28. can be an expensive proposition

29. may not be the best choice for NEPs that have already invested heavily in future technologies

30. is delay-prone and

31. is usually accompanied by post-merger integration challenges.

32. Entering into strategic partnerships

33. involves less complexity

34. yields benefits of partnerships quickly

36. has a strong proven record

37. considerable experience in systems integration and consulting services that extend beyond current products and services

38. has deep understanding of CSPs

39. has ability to provide pre-integrated and pre-configured solutions

40. provides access to the latest technologies and other resources on-demand

41. is willing to make combined investments in the co-development of solution accelerators and differentiating intellectual property