TC2's David Rohde on Telecom

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News and Analysis From the Enterprise User Viewpoint

AT&T knocks out its “camel hump” in spending, but where’s my last-mile fiber?

By Posted January 16, 2015

AT&T’s total capital expenditures in 2015 are slated to go down from its recent annual rate of about $21 billion to $18 billion. Recently I’ve made a big deal of capex (in plain English, network investments) especially for “second-tier” carriers like Level 3 that are knocking on the first tier’s door. So is this spending reduction at AT&T a concern?

AT&T’s answer at the recent Citi Global Internet, Media & Telecommunications Conference in Las Vegas is telling.

Remember from the appearance by Verizon CEO Lowell McAdam that carriers are out to impress institutional investors at this conference. So spending less on capex – which competes with shareholder dividends, share buybacks, and debt service after the “gross margin” of wireline and wireless services – is a “good thing.”

I’m happy to concede that this is as much the “fault” of the big investors and analysts as the carriers. The carriers get pressured this way on Wall Street (whether in Manhattan or transplated to Vegas) just as much as they feel other kinds of pressure in the political arena. Still, as a consultant to large enterprises I feel like I’m sitting in the cheap seats after hearing John Donovan, AT&T’s senior executive vice president for network and operations (AT&T’s CTO in so many words), give his view on this.

AT&T has had a comprehensive network upgrade program under way called Project VIP. Under this project, it credits itself with doing much better on its ILEC consumer broadband service called U-verse. In its wireless network it trumpets an industry-leading density of cell sites. (That’s something Verizon claims it doesn’t need as much of because of a larger percentage of 700-850 MHz spectrum, but that’s another debate.) AT&T’s in-building, in-stadium and other hyper-local buildouts, while often shared with other carriers, are generally on an ownership model with other carriers renting.

And look for AT&T to charge ahead on VoLTE because of the resulting wireless network reliability. Donovan noted that handoffs from LTE to 3G protocols like HSPA+ (I think we’re supposed to forget that AT&T once tried to brand the latter as “4G” – okay, I officially forget that now) in a sense don’t “matter” to data applications. But on voice they result in a dropped call. Density of LTE cell sites, yes, it’s a big deal.

The bottom line on Project VIP? “With very few exceptions – like the number of businesses passed with fiber – there’s some things where they’re still some work left to complete,” said Donovan. “But for the most part that program is checked off. And therefore we were able to take that camel hump, if you will, of capital spend out.”

If I had sound effects on this blog, I’d insert a record-player needle losing its track and scratching across the record. What’s that you say, John Donovan? In an era of carriers pushing people to move off of T1 and NxT1 to Ethernet access – indeed, AT&T’s own Withdrawal of Service Matrix now speaks directly to this – how is fiber to business locations a minimal “exception” that doesn’t stop you from “checking off” the recent capital spending surge?

Tickle an AT&T customer who’s been rapidly moving to 5M, 10M access and above, and ask them if they’re ordered Ethernet access and run into the buzzsaw of “special construction.” If Project VIP is – or apparently was – so great, how come a key product is being sold that you often can’t fulfill?

This is one of the reasons I’m tracking so carefully the second-tier’s models. It’s why it’s important for Level 3 to keep up the acquired TW Telecom’s hyperactive rate of buildouts to building entrances.

And of course it’s not necessarily the case that one carrier vs. the other is better or worse when it comes to the inevitable special construction issues somewhere. Much depends on best-practices terms and conditions, construction financing pools, and clear communications among the triangle of carrier, customer and building owner.

But based on what AT&T’s CTO said, there is still, ahem, “some work to do” and that overall reduction in company capex bears close watching in 2015. The breed of rising wireline carriers should note that AT&T, attitudinally, “checked off” its big investment initiative without having this issue well in hand. Users should sharpen their pencils in RFPs. Demand sets and RFP texts should be crystal clear on this issue.

Otherwise we might be looking at a “camel hump” of unexpected USER spend to get to the transformed, high-bandwidth-everywhere network. Or maybe a camel hump of AT&T customers finding somebody else to use. Keep watching this space.

Verizon can make plenty of money with lower prices … just ask their CEO

By Posted January 15, 2015

There’s an old truism in the telecom industry that carriers say the opposite thing in Washington that they say on Wall Street. In one version of the joke, “In New York they brag that they’re making gobs of money, while in Washington they say they’re going bankrupt and it’s somebody else’s fault.”

So what do you think they say in Las Vegas?

Really, Las Vegas during the week of the Consumer Electronics Show is sort of Wall Street transplanted because it features a simultaneous investment conference, the “Citi Global Internet, Media & Telecommunications Conference.” Listen, I’ll take the carrier’s statements at face value wherever they decide to take truth serum in order to impress the audience in the room.

And with so much attention being paid to the Washington side of telecom carriers – particularly in the net neutrality ruckus – we wouldn’t want carriers’ statements in “Wall Street West” to escape notice.

So here’s what Verizon CEO Lowell McAdam said in Las Vegas when he was in a Q&A session with a Citi analyst hounded by reports that the consumer “price war” was digging into Verizon’s wireless margins:

“From the network side, this reminds me of the days of voice and then the days of SMS and, now the days of data, where if you look at the top-line price, it looks like things are going down but the costs are going down equally so you can maintain some profitability. Just as the example, when we went from 3G to 4G, our efficiency of the network went up by 8 times. So you can take a pretty significant price cut and your costs are dropping at the same level.”

McAdam, of course, does not want Verizon’s stock to sag or for Verizon to be unable to continue refinancing the debt it loaded up on when it bought out Vodafone’s interest. Much of his bragging about Verizon’s continued profitability – we’ll know for sure when they report quarterly and full-year earnings on January 22 – was in the context of waving away higher churn rates in the face of T-Mobile and Sprint promotions.

And I think he has some justification on those points. The iPhone 6 launched caused action and movement among some portion of all the carriers’ customer bases. The carriers’ deals, particularly Sprint’s alleged half-off offer, naturally provoke a reaction. “Clearly customers are moving back and forth and seeing whether the claims are true,” McAdam dryly noted. He also implied that any customers lost are those that Verizon doesn’t want anymore, and those coming aboard are Verizon’s supposed target market of network-quality-sensitive heavy users, especially for multimedia.

So if he stretched a point to say to his audience – mostly institutional investors – that any price reductions don’t equal any margin or profit reduction at all, he’s probably not stretching by much. McAdam also jumped on the opportunity to raise what he calls the VLSS (Verizon Lean Six Sigma) program to credit some others in his senior executive team. “I think we took over $5 billion of costs out of the business just through process improvement in 2014 and we will do the same thing in 2015,” he said. “So that’s [also] where we will see the sustained margin that we’ve delivered historically.”

Well, nice job, guys! Enterprise customers may want to keep some of these metrics handy. Verizon clearly tries to take a premium pricing positioning vs. other carriers and shouts “network quality” in every other sentence, but the question is how much, if any, of that needs to come into play in big deals. I see plenty of pricing gaps and wiggle room. And I didn’t even have to go out to Las Vegas to find them.

Don’t let AT&T pull the rug out from under you because you didn’t know it was coming

By Posted December 31, 2014

Tomorrow is the first day of the second half of this decade. (Alarming, I know.) And I know that you know what the main story is in telecom for the years leading up to 2020: the end of the Public Switched Telephone Network.

So, are you thinking that there’s going to be a big announcement at some point during the next five years ringing the bell? Perhaps a big headline where the Federal Communications Commission announces that it’s okay for the big carriers to turn off the PSTN?

No folks, it doesn’t work that way. Okay yes, I suppose there probably will be some such event. But if you’re waiting for it, that’s going to be way too late. Carriers always prod and poke and push the envelope in an ongoing tension between technology, legality, and profitability. It’s going to be a dynamic process.

That’s why right now you need to be conscious of one of those strange little special aspects of being a telecom manager. It’s courtesy of the telecom industry’s unique structure of a (technically) publicly available but (practically) inscrutable disclosure mechanism, the notorious Service Guide.

In AT&T’s Service Guide, the carrier has started a “Withdrawal of Service Matrix” that is going to be used over time to roll out its complete IP network transition in terms convenient to itself, all while being able to say “I told you so” if you missed it and fall behind on transition plans.

To get the story, please go to Webtorials and check out our initial expert read of the Withdrawal of Service Matrix from LB3’s Deb Boehling and TC2’s Janis Stephens. Notice the complications that have already arisen. Soon Deb and Janis will have more to say about it. And the bottom line is that this is something you’re going to have to be bird-dogging for quite a while.

You don’t have to be any kind of daring early adopter in all this (besides which, all those people have already substantially moved). The challenge here is to stay two steps ahead of the game rather than one step behind. Timelines are going to be key. Welcome to the new world, for real. I look forward to continuing the conversation in 2015.

P.S. Yes, yes, I know. This “decade” technically runs from 2011 to the end of 2020, not 2010 to 2019, so we’re not really halfway through in strict mathematical terms. But by that logic you didn’t celebrate the millennium on December 31, 1999, you waited a year. And I know you gave in to popular perception back then, so spare me the technical complaints. Thanks!

Moody’s downgrade reflects Sprint’s sinking morass of issues

By Posted December 18, 2014

Three years ago I said that “For Sprint, now everything has to go right.” I’m not sure much of anything has gone right for Sprint since then.

Yesterday Moody’s lowered Sprint’s credit rating to “B1 with a negative outlook.” Here’s a handy guide to translation from credit-speak. B1 is four notches into junk bond territory. “Negative outlook” means Moody’s is signaling that the next move is likely to be the fifth notch down rather than a move back up.

The practical financial meaning is that Sprint is basically where bad CLECs were 10 years ago.

Moody’s credit downgrade comes on the heels of a proposed $105 million fine from the FCC for “cramming” unauthorized charges onto wireless bills. Sprint is hardly alone in cramming. But the fine would be a record among U.S. wireless carriers.

Sprint also has to face the ominous spike in spectrum costs signaled by the more than $40 billion in current auction bids for what was expected to be a relatively sedate AWS-3 auction. It’s not that Sprint doesn’t already have a great deal of spectrum on its hands – it certainly does via Clearwire. Organizing that spectrum into geographically consistent broadband service with additional investments has been their issue. And nobody wants to be financially hindered from getting some of the coveted low-band, high-propagation spectrum that the government is prying out of the hands of UHF television stations to auction off in early 2016.

The rising cost of capital implied by a crumbling credit rating does not bode well in this environment. At the marketplace level, it’s hard to see where Sprint is able to go on offense. Sprint has basically forfeited its place in the wireline business, and in enterprise wireless it’s principally relevant in terms of defending incumbent positions in individual accounts more than being able to blow people away with aggressive bids for new business.

In the consumer wireless market Sprint is certainly trying to look menacingly aggressive with its half-off offer. But I think it’s kind of a phony aggression that doesn’t come off cleanly. Certainly the offer is going to get people onto the showroom floor, to borrow a car-dealer image. But the whole promotion is based on waving its arms to say “me too” on whatever Verizon and AT&T is offering, because you have to bring in or send in your bills from those guys to try to get the deal.

Is this kind of me-too-ism a classic marketing mistake, as some marketing gurus would declare? Earlier this week T-Mobile introduced “Data Stash,” a plan to let customers carry over unused data allowances for up to a year, replete with shots at specific Verizon and AT&T practices from T-Mobile’s perpetual funnyman John Legere. I think that approach hits a nerve while “half off” is just whiny. Besides, everyone knows it isn’t really half off.

Remember something in all this that people may have already forgotten since midyear 2014. When SoftBank and Sprint were thinking they had a shot of buying T-Mobile from Deutsche Telekom and getting the U.S. government to approve the deal, they were clearly thinking of changing their name to T-Mobile and installing Legere as CEO. You don’t recover easily from this downgrade of your own brand value and self-esteem, even if it was never officially announced.

Of course SoftBank itself brings financial resources to the table. But some of their moves, like repurposing SoftBank engineers for Sprint work and clearing out Sprint employees under actual new CEO Marcelo Claure, look a lot messier in real-life human terms than they do on org charts.

One thing that’s always been implicit, and concerning, in the SoftBank/Sprint saga is that the main focus has never been on enterprise, as was clear two years ago even when the $22 billion takeover was just being discussed, and as was illustrated in the sad tale of the Nextel migration. I doubt that Claure’s understanding of how hard it is to appeal to enterprise customers when the whole focus is on cutting and chopping has advanced very far at all.

And there’s some concern about SoftBank’s staying power as its easy analogies to winning as a No. 3 carrier in markets like Japan and South Korea have proven exceptionally difficult to execute in the U.S. market. Sprint does now have 260 million LTE POPs and yesterday it boasted about its new network organization under SoftBank leadership. As a cross-cultural company SoftBank/Sprint is another test case in these global mergers, which overwhelmingly have proven difficult, as many large enterprise managers themselves have experienced.

That brings us to the other, aggressive players in all of these markets. T-Mobile’s potential in enterprise (which is still far more potential than actual) and the welcoming and varied approaches to enterprise wireline from Level 3, CenturyLink, Zayo and others are clearly starting to fill the gap. At this point does Sprint magically turn it around and effectively get back in the game for new business? Under current ownership and management, the answer in this corner has to be: It’s increasingly hard to see how.

BT jumps back into wireless by leapfrogging its old wireless business

By Posted December 17, 2014

A major global carrier having no play in wireless seems like an oxymoron at the dawn of 2015. And yet BT (known then as “British Telecom”) divested its wireless business in 2002 in an effort to pay down debt.

Now BT is going to jump back into the UK wireless market, and by jump I mean really leap. Skipping over a relatively simple opportunity offered by Telefonica to buy O2’s UK network, which has legacy ties back to the original BT wireless business, BT is negotiating with two other European national carriers to buy out their UK joint venture instead.

The carrier to be acquired is EE, an abbreviation for what itself was the 2009 merger of UK wireless carriers owned by Orange (of France) and Deutsche Telekom (of Germany). That merger resulted in “Everything Everywhere,” a mouthful that eventually became simply “EE.” More importantly, EE has risen to the top of the British market with a 34% market share and the most LTE coverage in the UK. Vodafone and O2 are tied for second with 26% each.

BT chose to say that the deal to purchase EE gives them the ability to offer their domestic customers “fixed-mobile convergence,” a term that may not have exactly the same play as it used to in the U.S., where it meant literally seamless landline and mobile handoffs.

I sense that BT simply means the opportunity to sell both fixed-line and mobile services to the same customers, most especially enterprises – something that Verizon and AT&T obviously revel in in the U.S. Since it originally spun out O2 and then sold it for good to Telefonica in 2006, BT has offered wireless services to enterprise customers as an MVNO. But interest from large companies has been limited at best. Acquiring EE will completely change the game for BT in the UK mobile market.

BT often struggles to offer bespoke deals (attractive, customer-specific deals) to enterprise customers that bundle multiple UK wireline products. So it will be fascinating to see how BT will approach enterprise customers with combined mobile/wireline deals, which is what enterprise customers will expect.

Not only is this acquisition important for any business customers, including U.S.-based multinational corporations, with substantial UK traffic and expenditures, but it also kicks off a round of transactions among a larger circle of world telecom players.

Telefonica itself is now struggling with debt as it tries to really refocus as a major player in the combined European and Latin American Hispanic-centric market. It was fairly desperately angling to get BT to buy O2 back instead of going for EE, pitching the idea that O2 would be a simpler transaction between one buyer and one seller. But with BT now opting for the greater market share and 4G coverage of EE – even at the price of paying both cash and BT stock to both Orange and Deutsche Telekom – Telefonica has to look elsewhere for financial relief.

Fortunately for them, they may have another candidate to buy O2 in Hutchinson Whampoa Ltd., an Asian diversified conglomerate with interests ranging from real estate to telecom – and the current owner of yet another UK wireless player called Three (ironically the No. 4 player in the UK with 12% market share). The financial implications of any Telefonica sale of O2 would go well beyond the UK, as Telefonica and Telmex (which now operates under América Móvil in its corporate structure) go toe-to-toe for Latin American regional enterprise business, much as SingTel rides the cresting wave of Asia-Pacific Rim enterprise business.

I’ll have more to say about Telefonica’s financial status soon. Suffice it to say that offloading O2 to somebody for some material amount of benefit is a huge priority for Telefonica.

If you’re following the players here, notice that for all the UK deal-making, the likely transactions don’t pose quite the same level of government “antitrust” or competition concerns as they have in the U.S. Quite simply, BT not being in the wireless business during mobile’s period of explosive growth means that there’s no explicit concern of competition reduction by its jumping back in with an acquisition. That said, BT is a unique beast whose dealings with enterprises should be comprehensively understood as business customers contract with EE (or whatever it will be called) going forward. We have our eyes eagerly trained on it.

Cable makes its first apparent foray into Ethernet Everywhere

By Posted December 16, 2014

Let’s say you compile a rigorous demand set of hundreds or thousands of U.S. network locations with all of their bandwidth requirements. Would you think of sending the spreadsheet to a cable company and expect a complete bid response back?

Probably not. For all of their local infrastructure, cablecos love to play in their own sandboxes and not in anybody else’s. In fact, when I go to Time Warner Cable’s website, it immediately informs me that services may not be available in my area (because I’m based in Fairfax County, Virginia, served by Cox Communications) and tries to shove me off to cablemover.com to find my own provider. Talk about turning away business.

And yet, Time Warner Cable apparently now IS interested in seeing these national enterprise network inventories. Tucked into a recent interview with TWC’s top business services executive at Telecom Ramblings was the revelation that the company launched a national Ethernet service a couple of months ago.

I’m not quite sure what TWC’s Philip Meeks means by “launched” a service. If there’s a press release or other announcement heralding this move, I can’t find it. But if he means that TWC business account executives are prepared to talk to you about providing Ethernet access even where TWC is not the local cable provider, that’s an important step forward for the cable industry’s participation in the enterprise market.

Now let’s talk about the caveats. I’m only bringing these up because I expect this to be a developing story over time.

First, Meeks says that lot of this service would be Type 2. Well yes, that’s what it would be. And on the surface, that’s a good thing. Type 2 – getting the underlying local loop infrastructure from somebody else – is exactly what cable companies have been allergic to up until now. Presumably a bid response would combine Type 1 and Type 2 connections into hopefully a very economical national proposal.

But note that Meeks puts all this into the context of what of course is TWC’s strongest desire right now, which I’m sure is even stronger than the desire to win your business – the proposal to merge with Comcast. With those two together, the combined company would service part of 20 of the largest 25 metropolitan areas. This seems to give Meeks the confidence to say that once the nirvana of a combined TWC-Comcast were achieved, the company would probably not have to continue to build out local infrastructure to expand their Type 1 footprint.

That’s dicey. Compare it to the approach of Level 3 and the unrelated TW Telecom, which recently merged. They have local presence in about 85 markets and, far from causing them to pull back on further buildouts and building entrances, the merger is causing them to accelerate that investment, or so they promise.

Why? Because much as I’m pleased that a cable company is finally willing to serve locations outside its footprint in order to complete proposals, that doesn’t mean that renting the incumbent last mile is the best way to go about things in all cases. If you can run fiber to a building (and effectively deal with any in-building remediation issues), then 10M Ethernet – or 50M, or 100M, or more – becomes a much more straightforward proposition.

Just think about the issue of Ethernet over copper. There are great developments in this area, especially with the recent ITU approval of the G.fast standard which theoretically boosts EoC speeds up to 10G. But that’s largely a consumer development. This technology is very-high-speed DSL technology and, similar to DSL, can’t really be qualified as to its actual speed and transfer rate until time of order. And to achieve anything like even 100M speeds, the distance has to be extremely short and the quantity and quality of copper pairs has to be high and available.

Even in non-managed, transport-services corporate RFPs, we’re rarely dealing with a true best-efforts scenario. There are invariably SLA and end-to-end network-visibility requirements from the customer or promises from the provider.

Bottom line message to Time Warner Cable: Kudos for breaking the taboo against cable companies going out of territory. But don’t be naïve about how easy it is to grab local loops wherever you want them and meet all of the pricing and quality requirements of rigorous enterprise RFPs. Comcast merger or not – and I’m not sure that this pitch for national Ethernet either justifies or fails to justify the merger – both willingness and effort are required to compete nationally in the emerging new Ethernet-centric enterprise WAN market. There’s a place at the table for you, or any other major cableco, if you really want it and prove you deserve it.

Day-old wireless, half off: The meaning of Sprint’s gambit

By Posted December 3, 2014

Great, so is Sprint going to take half off your company’s AT&T or Verizon bill?

Just kidding. But you gotta admit that Sprint’s announcement that you can bring your own personal Verizon or AT&T bill to them and get the same service for half the amount starting Friday got your attention. It got mine.

What do you make of it? Well, this is what CEO Marcelo Claure was brought in to do. No chief executive from within the carrier industry would have come up with this. Not even John Legere. Claure’s background as a trader of used handsets obviously teaches him to treat minutes and megabits as straight commodities.

I’m sure he’d deny that’s literally true and recite the lines that any national wireless CEO must recite about critical investments and network quality. But his actual actions since taking over Sprint have been primarily to chop and cut his way through the company’s cost base (mostly by firing people). He was brought in by SoftBank to get more subscribers and, by golly, he’s gonna get some.

But it’s that commodity outlook that’s sticking in my craw. On the surface, cutting the other guy’s price in half sounds like a very simple offer. Actually, it’s potentially very complicated. It’s the other guy’s bill he’s chopping, not Sprint’s. Wow, carriers and billing systems – they can hardly manage their own. Now here’s a carrier saying they’re going to work off of what somebody else is billing you.

How likely is that to work out perfectly? I almost want to offer up TC2’s Contract Compliance and Optimization experts, Julie Gardner and Theresa Knutson, on standby for the flood of billing complaints I foresee three months down the road from new Sprint customers.

I realize there’s a certain commonality among carrier retail offers which almost certainly will cause Sprint to at least try to pour new customers into a particular template. If it’s 20G these days for four lines and unlimited talk and text for $160, well then, 80 bucks it is. (Of course the family price point has moved down to $100 anyway in Sprint and other quarters, so this may not be quite that big of a concession.)

But why is Sprint letting someone else set the terms here? It’s one thing for a competitor in any field to take aim at a detested feature of another player’s offer (like ETFs in wireless). But for Sprint to say that it’s taking half off of all of whatever it is AT&T and Verizon are offering is telegraphing that it’s those two companies that set the standard. And the bit about this offer only being available to new customers screams “existing customers pay twice as much” (although it isn’t really that much, but the messaging counts). What’s that going to do to Sprint’s loyalty scores, churn rate, and brand value?

Here’s the takeaway, I think, for enterprise customers. Already Sprint has lower gross margins, higher churn rates, and no profits compared to the other carriers. Now it looks like it will settle for no margins and the hell with the income statement for a while (unless Claure just wants to finish emptying out the buildings in Overland Park, Kansas). Why is this rational in at least SoftBank and Sprint’s mind? Because right now what counts in wireless is postpaid subscribers, period. It’s the measuring stick of health on the assumption that wireless subscribers (even those without formal two-year contracts) are today’s version of yesterday’s ILEC telco phone lines – a near-guaranteed annuity because customers can’t do without the service in question.

If all that is the case, then there’s no reason for the thousands of subscribers that you offer up to these carriers to be sitting at premium margins. The game in enterprise may not be a question of looking for “half off” or of treating networks as commodities, which they most certainly are not. It’s more interesting than that.

If you do not know the actual best practices in enterprise wireless deals – not just leading-edge “discounts” but the good stuff that makes a real difference in the bottom line – then you’re just subsidizing the so-called price war in consumer wireless. As hints, these best practices involve things like commitments for at least one model of handset available free throughout your contract, quarterly rate optimization, ETF waivers that actually act as upgrade mechanisms, data pooling, no-, low-, and seasonal-usage mechanisms for given end-users, and much more. This really just scratches the surface and, along with the spectrum arms race that leads to clear distinctions among carrier coverage and capabilities, shows why “we’re just like the other guy, only less” doesn’t have any clean application in enterprise.

All that Sprint has revealed here with its 50% off consumer play is that there is a LOT of margin in the wireless business that is excessive compared to how wireless carriers are really being valued in the financial marketplace. Make sure that this extra margin is not coming out of your company’s pocket, and that you know to achieve this.

Funding for in-building mobile coverage is as big a part of an RFP as any other

By Posted December 2, 2014

The following is a guest post by TC2 UK managing director Mark Sheard.

Complaints about mobile coverage are not just a matter of big maps with colors. Coverage problems can happen within local areas, parts of cities, or individual buildings. End-users – your internal customers – are a great early warning system to these issues. Even if you haven’t had any complaints or these were “resolved” (or ignored) in the past, you cannot assume that coverage isn’t going to be a problem going forward.

If coverage in any of your buildings is poor, one way towards improvement is through in-building cellular enhancement with a distributed antenna system provided by your supplier. Who pays for this? Such coverage enhancement (and others) can be built into the deal, but you need to make sure the associated terms and conditions are fair and reasonable.

The investment funding required for coverage improvements is there to be negotiated just like any other aspect of the deal. You might also want to look more closely at your Wi-Fi infrastructure, so that data traffic can be more effectively delivered – just like many of us do at home. Of course, you may not want to or, in the short term, be able to upgrade this infrastructure to meet the social media demand of employees’ BYOD devices! But you may also soon realize that you do not have Wi-Fi access for visiting business partners or customers who are expecting it. You can quickly come around to wanting to make sure your in-building mobile network coverage is as good as possible.

As part of your next prospective deal – i.e., a structured extension negotiation or, better still, an RFP – you can get bidders to undertake coverage assessments to give you comfort or identify the need at your key locations. That’s the first step in obtaining improvements as cost-effectively as possible. When your leverage is at its peak before you commit to the next 2-year deal is the time to make sure your coverage needs are addressed.

Interestingly, once you have negotiated and seen your in-building cellular enhancement implemented, this can become a barrier to future change that you must consider in any RFP and potential transition to a new supplier. After all, now that you have provided the coverage, which executive is going to want to lose the signal in the underground parking garage that she has gotten so used to?

So how far do you go to lock in to a carrier? In order to assess this, it’s a question of looking at your total enterprise relationship with the suppliers in your market. But the mere fact that you will wrap this question into the context of a fully competitive RFP helps set the tone at the outset.