Telecom Expense Management in 2009. Where are we in the “Hype Cycle”? Peak or Trough?

Taking some time away from the office is always nice. It’s great to step out of the trenches, take some time to review the past, survey the landscape, and prepare for the future. One of the things I normally do with my time away is poke around the web for all things relating to Telecom Expense Management.

Wow! In the past year it seems everyone has decided to attach themselves to the Telecom Expense Management bandwagon. As one of the early adopters of the Telecom Expense Management business model (circa 2001) I find it interesting that now most auditors, consultants, agents and even carriers are now in the Telecom Expense Management business. Clearly the economy has a bit to do with how folks market themselves, (i.e. saying your a Network Design consultant doesn’t have the same appeal in a down economy as say, a Telecom Expense Management consultant) but I was shocked at the sheer number, and types of firms, now engaged in TEM.

With so many companies in the TEM space I decided to do a little market research and I came across the “Hype Cycle“. I thought it would be interesting to apply it to the Telecom Expense Management space and to see how, should I come up with any conclusions, it might affect Vocio’s strategy.

Now I’m speaking from a macro sense here. 2009 looks to be Vocio’s best year ever so in that respect I’m very bullish. From an industry adoption standpoint many TEM implementations have gone well, and many others have been a disaster. Given those results where are we on the “Hype Cycle”? Are the thoughts of those of us in the industry different from what most telecom and financial folks think? And how might that affect their adoption of TEM software.

In any case here’s what I came up with. Clearly the “Technology Trigger” that created the Telecom Expense Management space was the dotcom implosion (circa 2001). It was then, not unlike now, that the economy was depressed and most corporations were focused on lowering expenses. It was during this era when many newly created Telecom Expense Management firms began their journey to tame telecom expenses.

I would say it was not long after that we entered the “Peak of Inflated Expectations”. Aberdeen, Gartner and Forrester started publishing research papers and many TEM firms attracted large sums of VC capital based on the expected growth rates in the space. Many VC’s and entrepreneurs were convinced TEM would be just like a payroll service, in that all corporations would adopt the service rather than handle it internally. As it turned out managing telecom and wireless managed to be significantly more challenging to tame than originally thought, and whamo we enter the “Trough of Disillusionment”.

Now the final two stages are “Slope of Enlightenment” and “Plateau of Productivity” What I found to be most interesting is the what they call the final height of the plateau.

The final height of the plateau varies according to whether the technology is broadly applicable or benefits only a niche market.

So if we are in the final stages of the “Hype Cycle” what does that mean? If TEM were considered a mature technology does that mean the end of growth for the space? Is the height of the plateau established or does it fluctuate considerably for years, a decade, or more, before becoming broadly applicable or considered a niche business? With all of the new entrants into the Telecom Expense Management space are we going redefine TEM and revert back to step one? And most importantly if you’re a decision maker evaluating a TEM solution are you more or less comfortable with your vendor and/or the long term value proposition based on which stage of the “Hype Cycle” the technology is in? Does it even matter from any individual enterprises standpoint?

One might consider it a positive sign, and a sign of growth for the industry, now that so many have adoted the Telecom Expense Management mantra, or maybe it’s a sign that we’ve reached a plateau and the space is mature with limited growth, or perhaps the definition of Telecom Expense Management is too broad and void of meaning. I’m not sure what to make of all this. Perhaps it’s time to reenter the trenches and wait until next year to see how it all plays out. Any way you look at it for anyone involved in Telecom Expense Management it should be a very interesting year.

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