In a recent interview, Nazeer Adam, CEO of iMobility, shared valuable insights into the advantages and potential of operational expenditure (opex) models in driving innovation and efficiency in business operations. The discussion highlighted how opex models can transform various industries by offering cost-effective and scalable solutions, particularly in the African region.
Opex models focus on operational expenses rather than capital expenditures (capex). Instead of making significant upfront investments in infrastructure, businesses can opt for a pay-as-you-go approach. This model allows companies to pay a monthly rental fee for the services they use, eliminating the need for substantial capital outlay. The opex model is specifically applied to iMobility's offerings of CCaaS (contact centre as a service) and UCaaS (unified communications as a service). According to Adam, this approach saves millions of rands and reduces the burden of maintaining hardware and infrastructure. iMobility follows a grow-as-you-growmodel, allowing for scalability and focused efforts to realise return on investments.
Technology plays a crucial role in facilitating the transition to opex models. With advancements in virtual hardware and infrastructure, businesses can deploy massive servers that are virtualised and partitioned to serve multiple customers securely and cost-effectively. This segmentation of services enables companies to offer high-quality solutions without the need for significant capital investments, therefore reducing financial risk.
Various industries have successfully adopted opex models, including the telecommunications and solar industries. Large licensees, internet service providers (ISPs) and companies looking for a platform to onboard multiple users and migrate or onboard users from an existing platform can benefit from low cost and reduced responsibility for maintaining and upgrading infrastructure. In the telecommunications industry, for example, the responsibility for server maintenance and technology upgrades falls on the provider, allowing customers to focus on their core business activities, explains Adam.
The African region presents unique opportunities for adopting opex models. As a developing market, many telcos and providers can benefit from the low-cost entry and scalability offered by opex solutions. This model allows businesses to offer new products and services without the need for significant capital investments, thereby adding new revenue streams and enhancing their portfolios.
While opex models offer numerous benefits, one of the primary risks is choosing the right partner. Adam shares two crucial factors that businesses should consider when selecting a partner:
- Ensure that the opex provider selected can manage the infrastructure effectively and cater to the growing needs of the business customers.
- Select an opex provider that is trustworthy, reliable and understands the business vision.
Opex models are well-suited for collaboration among businesses. The multi-tenant and scalable nature of platforms such as iMobility’s allows operators to wholesale their services to other carriers and partners. Each tenant can be white-labelled and branded, making it an ideal solution for multiple partners and resellers.
For businesses looking to transition to opex models, the process involves several key steps. iMobility, for instance, provides a comprehensive onboarding document detailing the configurations and set-up requirements. This helps streamline the deployment process and ensures a smooth transition. Additionally, automated tests are conducted post-installation to verify the functionality of the platform, further speeding up the implementation process.
Opex models reduce the need for significant capital investments and shift the responsibility of infrastructure maintenance to the provider. Businesses can focus on their core activities and achieve faster time to market. As the African region continues to develop, the adoption of opex models is likely to drive innovation and growth across various industries, concludes Adam.
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