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Issue of August 2003 
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Carriers need alternate revenue streams

As traditional areas of carriers' business models like bandwidth face increasing commoditization, carriers need to develop alternate revenue streams.

According to Frost & Sullivan, three key issues influence how well carriers capture new opportunities. The most crucial factors include defining which parts of a customer's business they should take on, determining contract pricing model and, resolving how to optimally balance customization requirements of clients with efficiencies and economies of scale resulting from standardization.

At present, network outsourcing contracts are generally sourced through system integrators or other consulting firms and then subcontracted to carriers. While there is negligible difference in revenues from direct contract versus subcontract, true value for carriers centres on owning customer relationship with supplying future services.

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