cutting the cord the commercial impact of mobile...

Cutting the cordThe commercial impactof mobile computing

A report from

the Economist Intelligence Unit

sponsored by Nortel Networks

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© The Economist Intelligence Unit 2004 1

Cutting the cord

The commercial impact of mobile computing

Cutting the cord: The commercial impact of mobile

computing is a white paper written by the

Economist Intelligence Unit and sponsored by

Nortel Networks. The Economist Intelligence Unit

bears sole responsibility for the content of the

report.

The main author was Terry Ernest-Jones and the

editor was Gareth Lofthouse. The findings and

views expressed in this white paper do not

necessarily reflect the views of Nortel Networks,

which has sponsored this publication in the

interests of promoting informed debate.

As part of the research for this report, the

Economist Intelligence Unit conducted a global

survey of 309 senior executives on the topic of

wireless technology and mobile computing; the

full survey results are provided in an appendix to

this paper. We also interviewed senior executives

responsible for deploying mobile computing

solutions in a range of industries.

Our deepest thanks go to all the interviewees

and survey respondents for sharing their insights

on the topic.

Published January 2004

Acknowledgements

2 © The Economist Intelligence Unit 2004

Cutting the cord


In recent years mobile computing, a

technology that enables people to access and

exchange data on the move, has provided

one of the few bright spots in a generally

gloomy ICT sector. Sales of wireless LANs continue

to grow apace, and there are impressive examples

of companies using mobile computing to reinvent

their business processes. The advocates of mobile

computing are bullish: for the first time, they say,

ICT can be extended to transform every corner of

the business.

A less rosy view of wireless technology has

emerged from other quarters, however. Reports of

new security threats exacerbate fears that wireless

networks may be inherently unstable or vulnerable

to attack. The disappointing progress of 3G

networks also creates valid cause for hesitation.

Not surprisingly, decision-makers are unsure of

how much confidence they can place in a

technology that is far from mature.

This white paper, written by the Economist

Intelligence Unit in co-operation with Nortel

Networks, seeks to dispel some of the uncertainty

surrounding mobile computing. Drawing on

findings from a global survey of 309 senior

executives, the paper provides a rare insight into

how companies are deploying wireless technology.

The survey also highlights the challenges

businesses and the ICT industry need to overcome

if mobile computing is to deliver on its promise. In

particular, the white paper highlights three key

findings for companies as they plan their

strategies for mobile computing:

● Wireless is already transforming the

business environment. The first deployments of

wireless solutions are now bearing fruit. In our

survey, 84% of the companies using wireless

solutions say they are beneficial for flexible and

remote working, while similar proportions believe

they have a real impact on workforce productivity

and team collaboration. Companies like Sears,

Roebuck and FedEx are also using wireless

solutions to offer a range of value-added services

to customers. Only a small minority of respondents

believe mobile computing will help them reduce

their operational costs—though several case

studies in this report challenge this assumption.

● The barriers to adoption are disappearing. In

the short term, the cost of wireless technology and

concerns over security are the biggest obstacles to

the widespread adoption of mobile computing.

However, these barriers will become less

Executive Summary

Mobile computing is having a significant impact on corporate productivity, team

collaboration and the business environment, according to a new survey from the

Economist Intelligence Unit in co-operation with Nortel Networks. But problems

over security, integration and employee education must be resolved to ensure

wireless technology delivers on its full potential.


Cutting the cord


formidable as prices fall and technology vendors

build more robust security into their solutions.

Longer term, companies still have a real task on

their hands when it comes to supporting a

multitude of often incompatible wireless

technologies, and integrating them with their

back-end systems.

● The best wireless projects focus on people,

not gadgets. As companies focus on solving the

technical challenge of deploying mobile

computing, they are in danger of forgetting the

vital component in any wireless solution: their

employees. Only 35% of respondents offer specific

user training for mobile computing technology,

while almost half have no help desk for roving

users. On a more fundamental level, companies

will encounter resistance to mobile computing if it

becomes an imposition on employees’ private lives

(as the survey suggests it often does).

Corporate security. Corporate security policies

must be updated to address the vulnerabilities

that arise from wireless networks. Virtual Private

Networks with strong encryption, authentication

and access control mechanisms can be used to

provide robust levels of security in wireless

environments.

Employee training. Most organisations need to

increase both training and IT support for their

mobile users to ensure that wireless technologies

are used properly and to best advantage.

HR and communication. Wireless solutions are

most successful when they benefit individual

employees as well as the business as a whole.

Employee-friendly technology and enlightened

HR policies can turn mobile computing into a

mutually beneficial proposition.

Business processes. Companies need to be

creative in identifying processes that can be

improved or redesigned using mobile computing

applications—and target investment accordingly.

Cost savings. Wireless can cut waste and

inefficiency out of the supply chain. Companies

can also make substantial savings through IP

telephony, a technology that carries voice over

the Internet and wireless networks.

Wireless: What to review now


Cutting the cord


The growth of mobile computing is

gathering pace as initial projects begin to

bear fruit, according to a global survey of

senior executives conducted by the

Economist Intelligence Unit in co-operation with

Nortel Networks.

So far mobile computing projects have been

characterised by caution and experimentation.

Just under half of the 309 companies that

participated in the survey have already deployed

wireless technology. Most of the companies that

have done so are testing the waters: 57% have

deployed trial systems to small numbers of

employees, while only 18% have implemented

wireless on an enterprise-wide basis. However the

survey suggests the pace of adoption is about to

accelerate, with 63% of companies currently

evaluating wireless technology or in the process of

implementing it.

Nearly all the companies surveyed were

planning to invest in wireless in the next two

years, with most of this investment channelled

into wireless LAN technology. This matches

projections from InfoTech, a research company,

which show the wireless LAN market growing from

$550m in 2002 to $1.3bn in 2008. Wireless LAN

usage will also become much more commonplace,

with Gartner forecasting that the number of

wireless LAN users in North America will expand

from 4.2m in 2003 to more than 31m in 2007.

Investment is rising, but are companies reaping

the rewards? On the whole, survey respondents

that had implemented wireless solutions were

extremely positive about its impact on the

business. The survey shows wireless can deliver a

significant productivity boost in a number of

areas, particularly by enabling employees to work

while travelling and by supporting flexible or

remote working. Many of the executives (77%)

also say mobile computing improves collaboration

First fruits of mobile computing

Which of the following options best describes your company's attitude to mobile computing?

% of respondents

We are evaluating the case for mobile computing

We are now deploying/about to deploy this technology

We were early adopters

We are unlikely to implement mobile computing in the foreseeable future

We have decided not to implement mobile computing

17

25

38

1

19

Source: Economist Intelligence Unit survey, October–November 2003

Wireless jargon

The glossary of terms

can be found at the end

of the report


Cutting the cord


between dispersed teams: for example, in some

companies, wireless technology enables virtual

teams to tackle important business tasks in

significantly less time than traditionally required.

Given that almost every company in the survey has

large proportions of users that need to work on the

move at least once a week, these are all significant

advantages.

Customers are also beginning to benefit from

mobile computing, as companies begin to use

wireless technology to offer innovative, value

added services. German airline Lufthansa will offer

wireless broadband access on its entire long-haul

fleet from next year. About 80 of the company’s

long-haul jets will be fitted with Wireless LAN

solutions, enabling business users to set up a

secure VPN (virtual private network) connection to

their company’s intranet or mail server. FedEx and

Where has mobile computing been most beneficial in practice? Please rate the following options between 1 and 3, 1 being highly beneficial and 3 being not beneficial. % of respondents that have deployed wireless technology for mobile computing

1 2 3

Highly Moderately Not

beneficial beneficial beneficial n/a

1. Supporting flexible/remote working 46% 38% 6% 10%

2. Reducing ‘deadtime’ for travelling employees 40% 44% 6% 10%

3. Increasing workforce productivity 37% 47% 5% 11%

4. Enabling more effective collaboration between dispersed teams 35% 42% 13% 10%

5. Reducing infrastructure costs 10% 35% 40% 15%

6. Reducing operational costs 9% 41% 37% 14%


It is difficult to measure ROI from wireless

technology accurately at this stage. However, a

report by the IT research company IDC estimates

that the value of gains in productivity for senior

business professionals using wireless technology

reaches an average of around $500 per month,

while for general employees the gain is around

$120 per month. Microsoft has also attempted to

measure ROI on its wireless solutions: the

company spent $9m installing wireless LAN for

35,000 employees and says it took 18 months to

achieve a return on that investment. (This is

calculated on the basis of each user saving at

least 30 minutes per week at an average rate of

$67.30 per hour.) Meta, another IT research

group, says generally CIOs should strive for a

return on investment for their wireless LANs of

18-24 months.

Return on wireless investment


Cutting the cord


Whereas most enterprises are at the

stage of early deployment in separate

parts of the organisation, wireless

computing has become central to the

way FedEx, a distribution company,

operates. It first set up a mobile data

network in the early 1980s for relaying

pickup requests to drivers in delivery

vehicles. FedEx Express now handles

around five million wireless

transactions per day. In its depots

round the world, package handlers

have wireless LAN devices attached to

their wrists for scanning. This makes

the job quicker and safer than before,

cutting out the need for stepping over

cables and removing the chore of

picking up parcels for scanning. Each

international package is typically

scanned 20 times en route, and the

company believes it saves several

seconds each time through using the

wireless LAN devices.

From the start, FedEx found its

mobile data network brought an

increase of around 30% in productivity.

It is now investing $150m in new types

of wireless PDA devices named

‘PowerPads’ for its couriers, so they

have instant access to shipping prices

and other information when they meet

customers. They can also get weather

warnings and customer clearance data.

Bluetooth technology will be used with

the new ‘PowerPads’ so the couriers can

print bar-code labels for packages from

a small printer on their belts.

FedEx today makes much more use of

publicly available wireless technologies

and services, which reduces the cost of

building and supporting wireless

infrastructures. In the USA for example,

FedEx uses a public GPRS network for

towns and its own private network for

more remote areas. “In the

transportation industry we had to

create our own [wireless] solutions, and

we’ve been a leader up to now. But

others are catching up,” says Winn

Stephenson, FedEx’s senior vice-

president of information technology.

FedEx’s wireless expansion

Sears, Roebuck are among those developing other

value-added services in distribution and retail.

The survey also challenges the conventional

view that wireless LANs perform poorly in

comparison to traditional networks. In fact, 38%

of executives say wireless LANs are easier to

implement; similar proportions also believe they

are comparable with wired networks when it comes

to total cost of ownership. There were however

significant concerns on security, with 42% of

executives acknowledging that wireless data

networks are more vulnerable than traditional

networks.

As in most ICT projects, mobile computing

delivers the most value when technology is closely

matched to the needs of users. Bechtel, an

international construction company, has deployed

a range of wireless technologies including PDAs to

its field engineers, BlackBerry paging devices to

its senior executives, and wireless LAN for

temporary facilities on construction sites. However

the company has sought to avoid indiscriminate

enterprise-wide implementations. “We use

[wireless] where there’s obvious business value,”

says John Bailey, CIO of Bechtel.

Who’s using what?According to the survey, few industries expect to

be unaffected by mobile computing: 83% of

executives said mobile computing will have an

impact on their business in the next five years,

with half expecting that impact to be significant.


Cutting the cord


How often do the following groups of employees use mobile computing technology? Please rate from 1 to 5, where 1 means all the time and 5 means never. % of respondents that have deployed wireless technology for mobile computing

1 2 3 4 5

All the Several Occasionally Rarely Never

time times a day

1. Senior managers 24% 34% 30% 8% 4%

2. Sales force 22% 33% 26% 12% 8%

3. Customer service staff 16% 16% 33% 19% 17%

4. Field engineers 14% 25% 31% 14% 16%

5. Distribution and logistics 11% 18% 33% 17% 22%

6. Administrative staff 9% 20% 19% 23% 30%


So far, however, it is the manufacturing, retail,

and transport and logistics industries that lead the

way in wireless deployments.

Volkswagen, for example, has deployed a

wireless logistics system that connects roaming

workers in all its logistics centres in Germany to its

SAP system at the firm’s Wolfsburg headquarters.

The company claims the wireless LAN network has

dramatically enhanced accuracy and overall

productivity across all inventory, logistics and

transportation operations. In another example,

vehicle inspectors for the RAC, a UK breakdown

assistance service, use cellular wireless devices to

compile data on faults in different makes of car.

This information can then be sold on to the

manufacturers. In retail, Wal-Mart has asked its

suppliers to adopt radio frequency tags, a wireless

technology that will enable the company to track

stock dynamically and improve just-in-time

replenishment. Gartner Research says the

initiative will help Wal-Mart and its key suppliers

cut huge costs out of the supply chain through

labour savings and inventory reductions.

Innovations in mobile computing are now

appearing outside the early adopter industries,

and not just in the private sector. Hospitals are set

to become intensive users, with wireless

investment playing a significant role in the UK

government’s £10bn ($17bn) scheme to

modernise the National Health Service’s

healthcare systems. Projects range from enabling

community nurses to access and update patient

records via laptops connected to a GPRS network,

to providing medical staff with mobile access to

clinical guidelines and records via a secure

wireless LAN connection.

Most of these organisations are primarily using

wireless networks to exchange corporate data. But

this may not always be the case: one of the hottest

wireless applications to emerge recently focuses

on voice, not data. IP telephony, a technology that

carries voice over the Internet and wireless

networks, is now easy to implement and enables

companies to achieve huge savings, particularly on

their mobile phone bills.

The impact of wireless technology—both

wireless LAN and cellular—is spreading within

organisations as well as across industries. Sales


Cutting the cord


What are the main barriers to using mobile computing more extensively in your company?

Please pick as many answers as apply.

% of respondents

Cost of acquiring and deploying the technology

Fears over increased risk to corporate security

Integrating mobile computing applications with existing infrastructure

Unproven business case for wirelesss applications

Technology is not fast or reliable enough

Lack of interoperability between different mobile computing technologies

Technology remains too complex for non-technical users

Complexity of managing wireless networks

Concerns over managing mobile workers

Other

21

24

26

33

49

57

28

19

6

44


Sears, Roebuck, a retailer, is using

wireless technology to offer a new kind of

shopping service to its customers.

Surprisingly around 35% of the goods

Sears sells online are picked up by

customers in the stores. This may seem

like keeping a dog and barking yourself,

but it enables customers to enjoy the

benefits of online shopping without

having to wait days for the goods to be

delivered.

After placing an order, the customer

receives an email confirmation, showing

whether or not the goods are available

immediately. When the customer arrives at

the store, they head for the merchandise

pick-up area and input their telephone

number at a self-service kiosk. This sends a

message to a store assistant’s hand-held

computer connected to a wireless LAN,

who delivers the item to the pick-up area.

The assistant then swipes the customer’s

credit card through a magnetic stripe

reader attached to the hand-held

computer, confirming that the swiped

credit card matches the one used for the

online purchase.

Sears director Michael LeRoy says

customer pick-ups are sporadic, but by

using the wireless handheld devices he

claims response times have been improved

and stockroom workers no longer stand

idly by waiting for orders to retrieve. Also

Sears no longer has to staff a merchandise

pick-up window in the 870 US stores that

offer the online service.

Sears, Roebuck and wireless


Cutting the cord


forces, customer services staff, field engineers and

distribution staff emerge as regular users of

wireless applications, and most senior managers

‘go wireless’ several times a day according to the

survey. However, for many of these groups usage is

confined to basic communication tasks such as

keeping on top of email. Only 11% of respondents

derive significant benefit from the ability to access

enterprise data: this probably reflects the fact that

many organisations have yet to provide remote

wireless access to back-office data.

As wireless expands into new areas, companies

need to select the right devises for specific groups

of users. Decision-makers must choose from a

broad range of technologies, covering simple

pagers at one end to powerful PDAs and laptops at

the other. Some mass-market devices can now

perform tasks previously requiring expensive

specialist portables, but there is a long way to go.

John Bailey, CIO of Bechtel, believes the

inflexibility of many mobile devices holds wireless

solutions back. “If you could take BlackBerry and

3G, and combine it with an iPaq screen and the

Palm OS it would be a very compelling

proposition,” he says.

One of the most important developments to

emerge from mobile computing is the ability to

extend the advantages of information technology

to sections of the workforce that have previously

been largely untouched by ICT. Paul Lee, a director

at Deloitte Consulting, says a lot of wireless

investment is now targeted at field forces that

have traditionally relied on paper-based

processes. In this context, mobile computing can

cut down on duplication of tasks, provide access to

real-time information on orders, price changes or

job scheduling, and improve the efficiency of

processes in the supply chain. For companies with

large field-based operations, even minor

innovations have the potential to deliver

impressive rewards.

Obstacles to adoptionExecutives highlighted two top issues as the main

barriers to using mobile computing more

extensively in their companies: cost of wireless

technology and fears over security.

Cost is a major barrier for 57% of respondents,

but this is likely to become less of an impediment

providing prices continue to fall at the current

rate. According to Gartner, the prices for wireless

LAN equipment fell by 37% in 2002 and were

expected to have fallen by a further 25% in 2003.

As one of the top barriers to the deployment of

wireless solutions is removed, the growth of

mobile computing is likely to accelerate.

Concerns over security are not so easy to dispel,

unfortunately. In our survey, 46% of executives

were not satisfied that their wireless networks are

secure. Given this level of concern, it is

astonishing that 45% of the executives admit they

have no specific security policies in place for

mobile computing.

Wireless LANs in particular are seen as a weak

point in the corporate defences. Currently,

wireless LAN security is usually provided by the

Wired Equivalent Privacy (WEP) protocol but this is

not considered safe enough for many businesses.

Wireless LAN security may improve when a new,

more robust wireless security standard named

802.11i is adopted by the industry. In the

meantime, wireless vendors need to work more

effectively with users to overcome doubts over

security if they want to prevent wireless adoption

from stalling.

Malcolm Collins, president for global enterprise

networks at Nortel Networks, believes there is no

reason why wireless networks cannot be made as


Cutting the cord


Yes No

Do you have specific initiatives in the following areas?

% of respondents that have deployed wireless technology for mobile computing

1. User training in mobile computing technology

2. Specific security policies for mobile computing technology

3. IT support and help desks for mobile computing technology

4. Outsourced management of wireless LAN

1981

5446

3565

5545


secure as traditional networks. It is not that the

networks are inherently vulnerable to attack, he

argues; they just haven’t been set up securely in

the past. Virtual Private Networks (VPNs), together

with strong encryption, authentication and access

control mechanisms, can provide robust security

for both wired and wireless environments.

Despite the emergence of more resilient

defences, security will remain an important issue

for both wireless LAN and broadband deployments.

“Whatever you’ve got, security is a big nut to crack

at an affordable price, and with minimal

performance impact,” says Bechtel’s Mr Bailey.

A call for convergenceJust as patchy network coverage created problems

in the early days of mobile phones, so the limited

availability of wireless access points creates

Are you satisfied that your wireless networks

and mobile computing technologies are secure?


Yes 54

No 46



Cutting the cord


frustration for the users of wireless LAN

technology. In the survey, executives said

difficulty in finding and connecting to so-called

‘hotspots’ (wireless LANs installed in public places

such as an airport lounge or coffee shop) was one

of the biggest downsides to mobile computing.

Users also find it irritating when they have to

use one device to access a wireless LAN, and a

different device to access the GPRS network. Given

that people often travel between these different

networks several times in a journey, this can be a

major frustration. The industry is working on this

however. Mr Collins of Nortel Networks points to

new handsets that support both the public GPRS

network and wireless LANs and that will

automatically switch between the two as users

roam about. Nortel Networks is introducing

technology that allows access points for wireless

networks to communicate with each other to

enable seamless coverage.

Despite convergence between various wireless

technologies, companies will need to continue to

support a formidable range of systems and devices

in their wireless networks for some time to come.

Nick Jones, research vice-president for Gartner,

says organisations should develop a strategy to

support multiple wireless networking technologies

including wireless LAN, GPRS and Bluetooth for at

least another five years.

Supporting a wireless workforceAs companies battle to overcome the technical

challenges of wireless networks, there is a danger

they will overlook the needs of the very people

who are supposed to make good use of all this

technology.

Some answers in the survey suggest employees

have been an afterthought in many companies’

wireless implementations. For example, 65% of

the respondents with wireless networks admit they

have no specific user training in place for mobile

computing technology. Help desk support for

mobile users also lags far behind wired networks.

At the moment, a lot of employees are left to their

What is the biggest downside to using mobile computing technology as an individual?

% of respondents

Work impinges more on private time

Difficulty in finding and connecting to public hotspot services

Technology does not do what it is supposed to do

Time spent trying to connect to enterprise systems

More interruptions when trying to concentrate on work

Less opportunity to interact directly with colleagues

Other

13

13

9

4

26

23

12



Cutting the cord


own devices in more ways than one.

Wireless also raises more fundamental

questions over matters of employee welfare and

work-life balance. As bosses, executives see

wireless technology as a key driver of increased

productivity. As individuals, however, they

acknowledge the downside of the ‘always on’

network: work impinging on private time is the

biggest personal problem with mobile computing,

according to the executives we surveyed.

This is more than an issue of social responsibility:

return on investment studies for other ICT projects

that entail roll-outs to large user communities (such

as customer relationship management software)

show how important it is to ensure employees are

comfortable with and know how to use newly

introduced technology. If companies are sensitive to

the needs of the users of wireless technology, they

are likely to see a much better business return from

their wireless deployments.


Cutting the cord


Mobile computing is evolving from the

experimental phase to larger-scale projects that

address practical business needs. Even with

today’s limited wireless deployments, companies

are saving time, boosting productivity and

improving their business processes. In the next

few years, mobile computing will be deployed by

more companies to a larger proportion of the

workforce and for a more ambitious range of

business applications.

Many of the early objections to wireless

technology are being overcome as the technology

becomes more affordable, more reliable and easier

to implement. Security remains an important

concern, but there is no inherent reason why

wireless should be more vulnerable than existing

wired systems. Besides, companies can do a lot

more to help themselves in this area, not least by

updating their security policies to address new

threats in the wireless environment.

Despite progress in these areas, companies still

face difficult challenges in building the mobile

enterprise. At the moment, no wireless technology

can meet all corporate business needs, as each

technology requires trade-offs in terms of

bandwidth, range and cost. Enterprises developing

a wireless strategy will therefore need to support

an array of wireless technologies for at least

another five years. Matching the right

technologies to the right tasks will require careful

planning and sensitivity to the needs of different

user groups.

As companies like FedEx, Sears and the RAC

have shown, the real prize of mobile computing

comes from using it to transform core business

processes. ICT alone cannot achieve this:

employees need to be trained and motivated to

make best use of the new technology. If their

ambitions for mobile computing are to be fulfilled,

companies must make wireless technology as

beneficial for the individual employee as it is to

the business as a whole.

Conclusion


Cutting the cord


Executive survey results

Section 1

Demographics

A total of 309 senior executive participated in our online surveyon mobile computing. The survey was conducted in October andNovember 2003, and our thanks are due to all those who sharedtheir time and insights.

In which country do you live?

% of respondents

Africa/Middle East 6

Asia-Pacific 23

Europe 38

North America 27

Latin America 6

What were your company revenues in US dollars in 2002?

% of respondents

Less than $500 million

$500 million to $1 billion

$1 billion to $3 billion

$3 billion to $8 billion

More than $8 billion

Not applicable

3

7

10

59

11

10



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What industry are you in?

% of respondents

Financial services

Professional services

Other

Technology

Telecommunications

Automotive

Consumer goods manufacturing

Energy (including oil & gas)

Pharmaceuticals

Public Sector

Transport

Consumer goods retailing

Healthcare

Agriculture

Coal & steel

Environmental services

Mining & metallurgy

3

4

4

10

21

21

5

3

3

2

2

1

1

1

1

3

15



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How many employees does your company have across all locations?

% of respondents

1-500

500-1,000

1,000-5,000

5,000-10,000

10,000 – 50,000

50,000-100,000

100,000-250,000

250,000-500,000

Over 500,000

1

3

6

7

14

50

6

1

12

Which of the following titles best describes your job?

% of respondents

Chief executive/Chairman/Managing director

CFO/Treasurer/Comptroller

CTO/CIO/Technology director

Director of marketing

Director of sales

Director of planning/strategy

IT manager

Other manager

Other

7

6

6

28

4

4

21

18

6



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Has your company implemented wireless

technology for mobile computing?

% of respondents

Yes 41

No 59

Which of the following options best describes your company's attitude to mobile computing?

% of respondents

We are evaluating the case for mobile computing

We are now deploying/about to deploy this technology

We were early adopters

We are unlikely to implement mobile computing in the foreseeable future

We have decided not to implement mobile computing

17

25

38

1

19

Section 2

The impact ofmobilecomputing onyour business

Have you set budget aside specifically for investments in mobile computing technology?


Yes 43

No 57



Cutting the cord


In which of the following areas do you believe mobile computing offers the greatest potential benefit to your business?Please rate between 1 and 3, 1 being high potential benefit and 3 being no foreseeable benefit. % of respondents

1 2 3

High benefit Some benefit No foreseeable

benefit

1. Supporting flexible/remote working 58% 36% 6%

2. Reducing ‘deadtime’ for travelling employees 56% 35% 9%

3. Enabling more effective collaboration 44% 45% 11%

between dispersed teams

4. Increasing workforce productivity 43% 49% 7%

5. Reducing infrastructure costs 17% 39% 44%

6. Reducing operational costs 14% 43% 42%

Where has mobile computing been most beneficial in practice? Please rate the following options between 1 and 3, 1 being highly beneficial and 3 being not beneficial. % of respondents that have deployed wireless technology for mobile computing

1 2 3 n/a

Highly Moderately Not

beneficial beneficial beneficial

1. Supporting flexible/remote working 46% 38% 6% 10%

2. Reducing ‘deadtime’ for travelling employees 40% 44% 6% 10%

3. Increasing workforce productivity 37% 47% 5% 11%

4. Enabling more effective collaboration 35% 42% 13% 10%

between dispersed teams

5. Reducing infrastructure costs 10% 35% 40% 15%

6. Reducing operational costs 9% 41% 37% 14%



Cutting the cord


Which of the following best describes the majority of your mobile computing projects to date?


Trial system to small number of employees

Live production system for a specific business application

Enterprise-wide coverage

Other

8

18

57

17

Which of the following wireless computing technologies has your company invested in?


Wireless LANs/Wi-Fi

PDAs

GPRS mobile phones/smartphones

Bluetooth-enabled devices

Radio frequency tags

Other

26

10

7

52

75

40

How much did your company spend on mobile computing technology last year?


<$500k

$500k - $1m

$1m - $1.9m

$2m - $5m

$5m - $9.9m

>$10m

Don't know

3

15

3

8

64

1

6



Cutting the cord


In your view, how do wireless data networks perform in comparison to traditional wired networks on the following criteria?Please rate the following management disciplines between 1 and 3, 1 being better and 3 being worse. % of respondents that have deployed wireless technology for mobile computing

1 2 3

Better The same Worse

1. Simplicity of implementation 38% 45% 18%

2. Total cost of ownership 25% 52% 24%

3. Performance 22% 45% 32%

4. Reliability 11% 53% 36%

5. Security 8% 50% 42%

Are you satisfied that your wireless networks

and mobile computing technologies are secure?


Yes 54

No 46



Cutting the cord


Yes No

Do you have specific initiatives in the following areas?


1. User training in mobile computing technology

2. Specific security policies for mobile computing technology

3. IT support and help desks for mobile computing technology

4. Outsourced management of wireless LAN

1981

5446

3565

5545

How often do the following groups of employees use mobile computing technology? Please rate from 1 to 5, where 1 means all the time and 5 means never. % of respondents that have deployed wireless technology for mobile computing

1 2 3 4 5

All the Several

time times a day Occasionally Rarely Never

1. Senior managers 24% 34% 30% 8% 4%

2. Sales force 22% 33% 26% 12% 8%

3. Customer service staff 16% 16% 33% 19% 17%

4. Field engineers 14% 25% 31% 14% 16%

5. Distribution and logistics 11% 18% 33% 17% 22%

6. Administrative staff 9% 20% 19% 23% 30%



Cutting the cord


Section 3

Looking ahead

How much do you plan to invest in mobile computing technology in the next two years?

% of respondents

<$1m

$1-5m

$5.1-10m

$10.1m - $15m

$15.1m - $20m

>$20m

3

1

17

75

0

4

What are the main barriers to using mobile computing more extensively in your company?

Please pick as many answers as apply.

% of respondents

Cost of acquiring and deploying the technology

Fears over increased risk to corporate security

Integrating mobile computing applications with existing infrastructure

Unproven business case for wirelesss applications

Technology is not fast or reliable enough

Lack of interoperability between different mobile computing technologies

Technology remains too complex for non-technical users

Complexity of managing wireless networks

Concerns over managing mobile workers

Other (please specify)

21

24

26

33

49

57

28

19

6

44



Cutting the cord


What proportion of your employees need to work on the move once a week or more?

% of respondents

0%

1%-20%

21%-40%

41%-60%

61%-80%

81%-100%

9

14

44

1

9

24

How big an impact do you believe mobile computing will have on your company in the next five years?

% of respondents

Massive impact

Significant impact

Moderate impact

Small impact

No impact

18

41

7

1

33



Cutting the cord


Section 4

You and mobilecomputing

What is the biggest personal benefit you receive from mobile computing technology when at work?

% of respondents

Keeping on top of email

Ability to access enterprise data

Using business applications in the field

Communication with colleagues

Ability to work on the move

Other

11

44

6

11

24

5

Which of the following mobile computing technologies do you use personally?

% of respondents

PC with wireless connection

Laptop with wireless connection

PDA/Handheld computer with wireless connection

Using mobile phones to exchange data (excluding SMS messages)

Bluetooth-enabled devices

Other

55

27

7

69

16

32



Cutting the cord


What is the biggest downside to using mobile computing technology as an individual?

% of respondents

Work impinges more on private time

Difficulty in finding and connecting to public hotspot services

Technology does not do what it is supposed to do

Time spent trying to connect to enterprise systems

More interruptions when trying to concentrate on work

Less opportunity to interact directly with colleagues

Other

13

13

9

4

26

23

12

Which of the following attributes are most important to you personally when choosing and using mobile computingtechnology? Please rate from 1 to 3, 1 being critical and 3 being unimportant.

1 2 3

Critical Important Unimportant

1. Reliability 82% 17% 1%

2. Speed and performance 67% 33% 1%

3. Ease of use 34% 60% 6%

4. Size and ergonomics of devices 26% 60% 14%


Cutting the cord


Glossary

3G—The next generation of mobile network

infrastructure that supports always on, high-

bandwidth wireless services for data-intensive

applications. It is designed to offer the

performance required to deliver applications like

instant messaging and Web browsing over a

cellular network. 3G is often perceived as a

technology perpetually trying to get off the

ground.

BlackBerry—A basic two-way wireless device,

made by the Ontario-based company Research In

Motion (RIM), which allows users to check e-mail

and voice-mail (translated into text), as well as to

page other users via a wireless network service. It

has a miniature ‘qwerty’ keyboard to tap out

messages. BlackBerry users subscribe to a wireless

service to allow data transmission.

Bluetooth—Short-range wireless technology to

link mobile phones, PDAs, printers and other

peripheral devices together, eliminating the need

for cables. It has a range of around 10 meters for

transmitting data—via a transceiver chip installed

in each device. Bluetooth is slower than wireless

LAN (see below) at under one megabit per second.

Its zany name comes from a 10th-century Danish

king, Harald Blåtand (‘Bluetooth’) who unified

Denmark and Norway.

Code Division Multiple Access (CDMA)—The main

wireless phone technology used in the USA.

Several versions of the standard are still under

development. One of them, Wideband Code

Division Multiple Access (W-CDMA) is for ‘3G’

wideband digital communications using the

Internet and high-capacity applications like

multimedia and video. It is supported by GSM

providers and transmits data at 2Mbps.

General Packet Radio Services (GPRS)—This

‘2.5G’ cellular phone network technology is used

to provide ‘always-on’ Internet access via mobile

phones at speeds of up to 114Kbps. GPRS is

designed to work on GSM phone networks. Users

pay by volume of data transmitted, not length of

transmission. GPRS has been criticised as a pricey

service to use.

Global System for Mobile Communications

(GSM)—The ‘2G’ wireless standard used in Europe

and Asia, but far less so in the USA. GSM offers

limited bandwidth, and will eventually be replaced

by GPRS and 3G network technologies that enable

more sophisticated, data intensive applications.

Hotspot—A wireless LAN installed in a place where

people congregate such as an airport lounge or

coffee shop. It provides mobile users with high-

Wireless jargon: knowing your BlackBerry from your Bluetooth


Cutting the cord


speed access to the Internet through their own

mobile computers.

Personal Area Network (PAN)—A PAN links

devices within the range of a few meters round an

individual person, usually via Bluetooth.

Personal Digital Assistant (PDA)—A term now

used for a wide range of hand-held devices, such

as ‘Pocket PCs’, which give users access to a variety

of information. PDAs are increasingly used to

retrieve and send messages and to access

information from the Web.

Short Messaging Service (SMS)—A service

through which users can send text-based messages

from one device to another. The message of up to

160 characters appears on the screen of the

receiving device. SMS works with GSM networks.

Smart phone—A combination of a mobile phone

and a PDA, smart phones allow users to speak and

access the Internet wirelessly and can also be used

as personal organisers.

Universal Mobile Telecommunications System

(UMTS)—A high-speed 3G mobile technology,

based on GSM, which delivers audio, text and

multimedia to wireless devices through fixed,

wireless and satellite systems.

Virtual Private Network (VPN)—VPNs use the

Internet to connect businesses securely with

partners, branch offices and employees. VPNs are

used as an added layer of security in wireless LAN

deployments. A VPN uses the public network

infrastructure while maintaining privacy through

special security procedures and protocols.

Wireless Adapter—A device that slots into a

variety of static or mobile computing equipment,

giving wireless connectivity.

Wi-Fi—Wi-Fi (short for wireless fidelity) is the

popular term for a high-frequency wireless local

area network (see below).

Wireless LAN—A local area network in which data is

transmitted and received using radio frequency (RF)

technology rather than wires. Wireless LANs are based

on a family of wireless technology standards called

802.11. Each of these standards offers different

characteristics: 802.11b is the dominant workhorse

standard; 802.11g offers higher speed; 802.11a offers

both high speed and scalability; while the emerging

802.11i standard promises to boost security.


Whilst every effort has been taken to verify the

accuracy of this information, neither The

Economist Intelligence Unit Ltd., Nortel Networks

nor their affiliates can accept any responsibility or

liability for reliance by any person on this white

paper or any of the information, opinions or

conclusions set out in the white paper.

Cutting the cordThe commercial impactof mobile computing

A report from

the Economist Intelligence Unit

sponsored by Nortel Networks

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