Running head: Green Mobile Networks 1
Green Mobile Networks
Florida Institute of Technology
MGT 5115
Case Study 1: Green Mobile Networks 2
Abstract
This case study deals with incentives which are driving network operators to
develop greener networks. Though “going green” can have many connotations, the
focus of this case study will define greener networks as bold initiatives to improve the
energy efficiency of wireless networks and reducing the carbon footprint and
greenhouse (GHG) emissions associated with network operations.
The study will focus on four different incentives; reducing costs, overcoming
limited availability of reliable electricity, being more socially responsible and gaining a
competitive advantage. The study will prioritize these incentives and explain such a
prioritization.
This paper will also review the predictions of global warming and related issues
while considering the impact on the environment if the expanding surge in the use of 4G
networks does not go green.
Finally, I will look into all of these aspects in order to determine if the bottom line
of profitability is improved by implementing a green network.
Case Study 1: Green Mobile Networks 3
Introduction
Recently, the need to “go green” has come up for debate among many
businesses for whatever reason that may come up throughout their business decisions.
For the sake of this paper, it assumed that network operators (carriers) are considering
setting up green networks and that there is a question of whether or not it is beneficial
not only for the company itself but for the environment as well.
Considering this whole case study is centered around an unproven theory which
has become more of a political stance than an actual science, this paper will focus more
on the facts of the implications of green networks on a business. Also considering this is
a case study for a course on information technology as opposed to a meteorogical or
natural sciences course, this paper will not try to prove or disprove global warming or
greenhouse gasses and its effect on the environment considering even those in that
science have not been able to come to a conclusion.
Background
According to the case study in Volonino, Turban mobile network operators
worldwide have embarked on bold initiatives to improve the energy efficiency of their
wireless networks and have been “going green” in order to reduce the carbon footprint
and greenhouse emissions associated with network operations. The study also says
that Clearwire, the largest 4G service provider in the United States, began trials of highefficiency
“green” base station cabinets. These base station cabinets are capable of
achieving up to 90% reduction in electrical operating expenses. They also do not
require the use of HVAC equipment. Depending upon the results of the trials the new
Case Study 1: Green Mobile Networks 4
base station designers expect to introduce the base station cabinets throughout the
Clearwire network.
Case Study Question 1
Rank the four incentives according to how you believe they motivate a company to
invest in greener IT.
1. To reduce costs: Energy consumption is one of the biggest operation costs for
both fixed and mobile networks.
2. To gain competitive advantage: Network infrastructure vendors are striving to
gain competitive advantage by reducing the power requirements of their
equipment.
3. To overcome limited availability of reliable electricity: Many developing countries
are high growth markets for telecommunications, but they have limited access to
electricity.
4. To be more socially responsible: Many organizations have adopted corporate
social responsibility initiatives with the goal of reducing their networks’ carbon
footprint.
Case Study Question 2
Explain the reasons for your ranking.
The reason for the ranking in Case Study Question 1 is because first and foremost a
business is created to make money, and barring any extraneous situations involving
social uprisings or third world expansion, reduction of costs and gaining competitive
advantage are keys to making that happen.
Reducing costs, if possible through the use of green technology, is crucial to
moving forward as a company. Though changing the terms to “green networks” just
Case Study 1: Green Mobile Networks 5
because you are using less electricity is just a marketing scheme as opposed to a true
business strategy.
Reducing electricity costs is certainly a valid way to help a company move
forward as long as the reduced cost for the electricity is worth the added price of the
product over the lifetime of the product. For example, say that each new base station
cabinets will cost an extra $20,000 due to the 90% drop in electricity, if the life time for
the use of the cabinet is 10 years the cabinet would need to save $2,000 per year or
just over $166 per month. If the typical cost of electricity for the candidate is over $185
per month then it could certainly save $166 with a 90% savings on electricity. The case
study indicates that the cabinet would not require an HVAC system so such savings in
electricity for HVAC would also save money toward the $166 per month. As there is no
indication of exactly what base station cabinet is being purchased and what the extra
price would be for the extra cost for going green and there is no indication of what the
power usage for its previous base cabinet, there is no way to know if the cost of the
green cabinet is worth it.
A formula which could help to make an informed decision would be:
(Extra cost / (lifetime in years))/12 months = amount of savings needed per month
Current cost per month x percent of savings – HVAC system monthly cost = potential savings
If the potential savings is greater than the amount of savings needed then the
green technology is worth the extra cost. Otherwise it should be reconsidered before
going forward.
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What is also not included in this case study of the base cabinet is the difference in cost
based on the hardware’s reliability, warranty, cost to repair and any further costs to
changing over the hardware.
The second ranking of competitive advantage is somewhat closely tied to the first
ranking involving cost. If you are able to provide the exact same product as your
competitor at a lower cost, then you have a distinct advantage. You can use the extra
savings to either lower the price of the final product and thus gain market share of
customers, or you can use that extra savings toward investing in your company’s
infrastructure in order to further gain an even larger competitive advantage.
The third ranking of dealing with limited availability of reliable electricity in
developing countries is certainly a consideration. If you are unable to break into a
market because of limited availability to electricity then most likely, your competitor is
not able to do so either unless they can lower their power consumption. So it comes
down to a race between companies to come up with the lowest power consumption in
order to break into new markets which have no competition providing a virtual monopoly
on services which is a rarity in most business environments. However, such singular
offering of service does not last long as competitors usually find ways to catch up in a
successful market, but being there first does tend to have its own advantages.
Finally, the idea of being socially responsible can be beneficial to a business
though it should not be a huge consideration unless it can be spun in a very positive
way. Social responsibility may increase revenue if there is enough of a marketing
campaign to back it up which could take advantage of those who may feel that there is
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some benefit to going green. But this type of marketing campaign could be done with
any sort of social issue so a company should do some marketing research to find out
how beneficial going green could be to business perception. However there are any
number of social issues which can be taken advantage of if a marketing campaign is
desired for the desired effect.
There are some political connotations to going green which should be considered
depending upon the agenda of those in power. If a company is able to stay ahead of a
competitor when it comes to going green and a government institutes restrictions on
those who do not go green, it will give a distinct competitive advantage to your
company. Lobbyists could be used to drum up support for your style of going green and
give you an advantage over your competitor. Though this is a bit of a gamble and could
be money spent with no payoff.
Case Study Question 3
Review predictions of global warming and related issues. Consider the expected
surge in the use of 4G networks, which will increase electricity consumption to
power the networks and cool the equipment. Based on your research, estimate
the impact on the environment if mobile network operators did not invest in
greener networks.
Considering the whole industry of global warming is made up of either scientists
who are paid to report that global warming exists and get paid to further research such a
Case Study 1: Green Mobile Networks 8
trend, while on the other side there are the scientists paid by industries who would be
hurt by global warming legislation, there is much division in information on global
warming including actual falsifying of information to further an agenda.
For example, scientists who are paid to research global warming were found to
be tampering with data in order to get the data they desired such as Phil Jones’ hacked
e-mail where he reveals “I’ve just completed Mike’s Nature trick of adding in the real
temps to each series for the last 20 years (ie from 1981 onwards) amd from 1961 for
Keith’s to hide the decline.” (Delingpole, 2009) Or the fact that “The lack of warming for
more than a decade—indeed, the smaller-than-predicted warming over the 22 years
since the U.N.'s Intergovernmental Panel on Climate Change (IPCC) began issuing
projections—suggests that computer models have greatly exaggerated how much
warming additional CO2 can cause.” (Allegre, 2012)
Also, there is the economic statement that “There is no compelling scientific
argument for drastic action to "decarbonize" the world's economy. Even if one accepts
the inflated climate forecasts of the IPCC, aggressive greenhouse-gas control policies
are not justified economically.” (Allegre, 2012)
From these observations, it can be said that there will be no impact on the
environment whether or not greener networks are invested in or not. The best thing that
can be done is to make the networks more efficient and use the power consumed in the
most useful way possible in order to advance the wireless network industry so that we
Case Study 1: Green Mobile Networks 9
may further benefit from the ability to connect to information and data through wireless
technology.
Case Study Question 4
Bottom line: Is it profitable for operators to go green?
As indicated in Case Study Question 2, there are many reasons why going green
may be profitable for a business whether it is from a reduce in operating cost or from
gaining a competitive advantage in uncharted territories due to electricity availability. Or
there is also the potential for taking advantage of a public perception that going green is
a good thing and that such a perception could become beneficial with the right
marketing campaign.
.
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References
Delingpole, James (2009). Climategate: the final nail in the coffin of 'Anthropogenic
Global Warming'?
Allegre, Claude; Armstrong, Scott; Breslow, Jan; Cohen, Roger; David, Edward;
Happer, William; Kelly, Michael; Kinimonth, William; Lindzen, Richard; McGrath,
James; Nichols, Rodney; Rutan, Burt; Schmitt, Harrison H.; Shaviv, Nir;
Tennekes, Henk; Zichini, Antonio (2012) No Need to Panic About Global
Warming via
http://online.wsj.com/article/SB1000142405297020430140457717153183842136
6.html?mod=WSJ_Opinion_LEADTop
.
) Be honest on your failings and that you know it shouldn't be 100% but a 5% is unconscionable imo unless you discussed something completely off topic and lacked structure.
