* Experts share ideas on containing cellular costs
Wireless can easily take on a life of its own within enterprises as mobile devices become smarter, more abundant and just plain “cooler.” As such, companies without centralized mobility strategies and user policies are leaving boatloads of money on the table. What can you do about it?
Experts at recent conference I attended, Mobile Explosion ’08, offered up a number of practical tips for getting your arms around mobile devices and services to reduce wireless spend. I’d like to share some of them with you here.
Monthly recurring charges account for 53% of an enterprise cellular bill, which, on average, runs $84 per device per month, according to David Spofford, CEO of Invoice Insight. This is not an optimized, best-practices figure, he is quick to point out, but it reflects reality today.
The remaining 47% of the bill lies in overages, long-distance, texting, data usage, and taxes – all of which you can do something about (yes, even taxes, which are different in different states). Spofford calculates that the average spend across organizations is about 15 cents per minute. But he and others believe large organizations should be able to get that number down to below 5 cents or even 3 cents per minute by centralizing purchasing decisions, standardizing on a few platforms, and creatively upping their eligibility for discounts.
For example, Jeff Mazzabufi, telecom manager at worldwide electronics manufacturer Hubbell, said he simply moved 95% of the company’s cell lines from Verizon Wireless to a Verizon reseller in early 2006. By virtue of the move, he jumped from an 8% discount to a 12% discount for the same number of phones and same service. End of that story, except that he says he receives better customer service from the reseller at a lower cost.
Mazzabufi has also done the following to reduce costs:
* He has standardized on two devices each for voice-only, smartphone, and PDA requirements. He buys these and related accessories, such as mini-USB power connectors, chargers and Bluetooth headsets, in bulk. Because the environment is standardized, he can “reuse bits and pieces” of these accessories in a mix-and-match fashion, rather than buying all separate accessories for different platforms.
* He has moved the company from plans that pooled cellular minutes within each business unit to enterprise-wide pooling, which has resulted in fewer overages – the expensive per-minute usage charges that kick in once an organization has surpassed its allotted number of minutes in a given month. He also offered employees the option of procuring handsets for home and personal use under the corporate discount, kicking up the company’s eligibility for greater discounts. However, the company does not manage the personal-use devices.
The creative pooling, he said, has resulted in 47% savings on its bill from AT&T, whose services are used for global travelers, or about $214,00 per year. He has saved $52,000 per year from Verizon Wireless, and more than $100,000 from the Verizon reseller.
There’s a gotcha on the use of corporate-funded cell phones related to tax issues. More on that next time.
