James Israel, vice president of Managed Services Sales for Ericsson North America, explains why operators in the US should sign contracts for managed services with Ericsson.

“Ericsson’s success in executing managed service contracts globally has shown that we can customize our offerings to suit our customers and deliver profitably for them and us,” he says. “When entering the US market, this is very important. Operators here have different views of outsourcing and the importance of internal operational activities. It is not uncommon for an operator to market the importance of the network itself to its end customers. In this case, traditional outsourcing would not be an attractive alternative and we would need to look at other solutions to help that operator reach its business objectives.”

Israel says Ericsson is the global industry leader in managed services and is well positioned to secure a leadership position in the US. “We have established our global capabilities and can rely on economies of scale to deliver a cost-effective solution,” he says. “It is extremely important to the operators that whoever they pick has a solid strategy and will be a viable managed services partner in the longer term.”

Israel is upbeat about the state of the US market and the potential for growth in managed services.

“The US market has great potential,” he says. “Key factors, which were previously absent, are coming into play: we see some operators focusing more closely on cost improvement, and private entities have directly entered the market driving expectations on improving EBITA (earnings before interest, taxes and amortization). As the leader in the telecom managed services market, Ericsson is well positioned to work with the operators looking at alternatives to achieve and exceed their business objectives.”

Ericsson is presenting its managed services offering at the NXTcomm event in Las Vegas, June 16-19, as part of its push for more contracts.

Martin Roos, vice president of Managed Services Sales at Business Unit Global Services, says: “Managed services are about transforming operators’ current CTO organization from a one-to-one delivery model into a one-to-many delivery structure with local and global economies of scale. (Ericsson’s views on economies of scale are explained in this film.) With managed services’ sales results in excess of SEK 12 billion in 2007, Ericsson is better placed than anyone else to create economies of scale by aggregating activity volume from multiple customers. And with its experience from more than 100 officially announced contracts worldwide and from managing networks that together contain over 100,000 nodes and include 195 million subscribers, it is best positioned to manage the large operational challenges that such undertakings involve.

“As the clear leader in managed services, we can take full end-to-end responsibility for managing operators’ network domains, and the entire service layer, business support systems and operations support systems. As a partner to the operator, we are delivering quality performance at an optimal cost, allowing our customers to focus on their core business – their customers.”

While managed services are gaining popularity in the US, Europe remains one of its most fertile markets.

“We have secured at least three major contracts in the Netherlands and one each in Belgium and Germany as well as many small ones,” Roos says. “Outside Europe, Brazil and India are also success stories for us.”