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North American Green Carrier Matrix

 

Vendor Matrix

Released
3Q 2009
Product Code
VM-GONA-101
Price
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The greening of mobile networks is being driven primarily by the need to lower energy consumption and operating costs, from organizational, network infrastructure, and equipment perspectives.  In difficult economic times, operators who excel in lowering their carbon footprint are expected to gain from a moral and ethical standpoint as well as to have a competitive edge where differentiation between services is becoming more complex and revenues are flattening. 


The Green Mobile Operator Matrix ranks operators on their environmentally friendly, clean technology initiatives primarily focused around green — relating to network infrastructure, network equipment, handsets, and handset recycling.  The matrix also considers green initiatives that are linked to CSR (Corporate Social Responsibility) such as buildings/facilities, IT infrastructure, vehicle fleets, and teleworking as an internal initiative and as a service for business customers.

 

The matrix covers the activities of mobile operators as well as larger organizations that could include activities from the wireline part of the business.  Higher weight is given to operators who have provided data or have set specific future goals in order to back their claims of green initiatives.  This particular matrix covers North American operators in the United States and Canada.

 

AT&T leads the matrix as the greenest operator in North America followed closely by Sprint.  AT&T takes a slight lead over Sprint partly due to its focus on green innovation and R&D, mostly out of the AT&T Bell Laboratories facility.  AT&T has also innovated in the use of new metrics for measuring carbon reduction and is actively involved in smart grid projects, especially those that are concerned with last-mile connectivity to the customer.  While AT&T is the leader in terms of innovation, Sprint leads in terms of implementation. However, overall AT&T beats Sprint as the greenest operator.  One key reason is that AT&T seems to have a better handle on its mobile network and cell site energy consumption and has already implemented specific plans such as reducing dual networks, as well as setting goals for itself in this key area.  Green mobile network infrastructure carries the maximum weight in this matrix and AT&T leads the way.

 

Sprint is recognized for a wide variety of green initiatives and the ambitious goals the company has set for itself regarding greenhouse gas emissions and other green aspects.  Sprint leads especially in the area of green handsets, handset recycling, green buildings, and green IT.  Sprint is also recognized in terms of driving green agendas for its own supplier value chain, both in networks and handsets.

 

While Sprint has an extensive goal-oriented green agenda, the company falls short in providing specific details about achieving most of its goals.  AT&T does provide specific data and information backing up its green commitments in the area of carbon emission reductions for each of its initiatives.

 

AT&T and Sprint are considered in a league of their own relating to green initiatives with Verizon falling short on critical areas including green mobile infrastructure, handset and battery recycling, green handsets, and green R&D and innovation.  T-Mobile has green initiatives that are limited to handsets or handset recycling.  

 

Telus leads the pack in Canada, primarily for its efforts in reducing energy consumption at its cell sites and in its mobile network infrastructure equipment. Telus follows a methodical and open approach to being green, not simply building a green brand but backing it up with specific data.  Most of the Tier Two vendors in North America including Leap, MetroPCS, and US Cellular have limited green initiatives, primarily centered on handset recycling.

 

 

Description of Criteria

 Criteria used to develop this vendor matrix are related to product and company characteristics that serve as proxies for vendor performance in the areas of Implementation and Innovation.  Numerical scores are aggregated, weighted, and analyzed to provide overall rankings, which are assigned to each vendor on the Innovation and Implementation axes.

 

Implementation

The eight Implementation scoring criteria and their associated weighting are as follows:

 

1. Green Mobile Network Infrastructure (25% weight)


  • Evaluates the use of green base stations

  • Evaluates the use of alternative fuels for off-grid and on-grid sites

  • Evaluates the use of green core network equipment

  • Evaluates initiatives to reduce cell site power consumption including auxiliary site equipment

  • Evaluates the amount of carbon reduction reported due to green mobile infrastructure initiatives


2. Green Buildings and Facilities (5% weight)


  • Evaluates number and size of buildings with Energy Star ratings

  • LEED (Leadership in Energy and Environmental Design) Certification

  • Evaluates other green building certifications

  • Using LED signage in retail stores and buildings

  • Evaluates the amount of carbon reduction reported due to green buildings and facilities


3. Green IT (10% weight)


  • Evaluates the use of energy-efficient monitors within organization

  • Evaluates initiatives such as remote switch-off of monitors or desktops when not in use

  • Evaluates the use of thin client systems at data and call centers

  • Evaluates the recycling of IT equipment such as desktops, monitors, servers, and so on.

  • Evaluates the amount of carbon reduction due to green IT


4. Handset/Battery/Accessory Recycling (20% weight)


  • Evaluates programs to collect and recycle mobile handsets

  • Evaluates battery swap or battery recycling schemes


5. Teleworking and Teleconferencing Initiatives (5% weight)


  • Evaluates employee teleworking schemes

  • Evaluates use of teleconferencing to reduce employee travel

  • Evaluates collaboration or marketing of teleworking services for customers

  • Evaluates the amount of carbon reduction due to teleworking or teleconferencing


6. Green Transport Fleet and Logistics (5% weight)


  • Evaluates use of energy-efficient smart cars for fleets

  • Evaluates other initiatives to reduce fuel consumption, such as limiting engine idling or using inverters

  • Evaluates the use of telematics to monitor fleet fuel consumption

  • Evaluates initiatives aimed at further optimizing logistics and inventory management

  • Evaluates the amount of carbon reduction due to green fleet or logistics


7. Green Handset, Content, and User Awareness Strategy (20% weight)


  • Evaluates the availability of mobile handsets that use recycled materials

  • Evaluates the availability of energy-efficient mobile chargers

  • Evaluates the availability of specific content for users related to green living and green lifestyles

  • Evaluates operators’ initiatives in raising awareness of green issues among customers


8. Green Packaging (10% weight)


  • Evaluates the use of ecologically friendly packaging materials for handsets

  • Evaluates operators’ initiatives encouraging handset suppliers to provide ecologically friendly packaging

  • Evaluates the amount of carbon reduction due to green packaging


Innovation

Innovation criteria for the matrix are designed to reward operators for green R&D and improvements in terms of the products and services as well as the use of technologies to reduce power consumption.  Operators are recognized for their innovative use of techniques to measure carbon reduction.  Operators who have a direct or indirect impact on product innovation in the supplier value chain are also recognized. There is a slight overlap in the Innovation and Implementation criteria, but specific examples are acknowledged as being particularly innovative.

 

The six Innovation scoring criteria and their associated weighting are as follows:

 

1. Innovative application or use of technology for green networks (20% weight)


  • Evaluates innovative use of technology or other methods to reduce power consumption at cell sites.


2. Direct or indirect impact on green innovations for supplier value chain (15% weight)


  • Evaluates direct or indirect activity that leads to innovation in green equipment or products (for example, setting standards and goals for packaging, handset, or network equipment)


3. Innovative metrics for the measurement of carbon/energy reduction (10% weight)


  • Evaluates innovative use of measuring carbon or energy reductions


4. Smart Grid Networks (15% weight)


  • Evaluates use of wireless network for smart meter connectivity

  • Evaluates partnerships with smart meter vendors

  • Evaluates the number of utilities that are currently using their service

  • Evaluates the organizational capabilities within the operator’s facility to support smart grid services (such as an M2M Division)


5. Green Networks R&D (30% weight)


  • Evaluates the commitment to research and development of green network infrastructure or devices

  • Green base stations

  • Green core network equipment

  • Alternative fuels for base station sites

  • Recycled materials for use in mobile handsets


6. Other Green R&D (10% weight)


  • Evaluates commitment and collaboration around research and development of green technologies, in general

  • Alternative power generation for facilities

  • Alternative fuels for vehicle fleets

  • Evaluates research aimed at ecological conservation


Scoring

Vendors receive a ‘rating score’ for each ABI Research-defined criterion under Implementation and Innovation.  These scores range from 0 to 100 and are based on available information as well as ABI Research assumptions.  Points are awarded in increments of five.  A score of 55 is possible within a given criterion.

 

Each criterion (and its score) is weighted based on ABI Research’s opinion of its level of influence and importance to the overall assessment of Implementation and Innovation.  The number of criteria may vary; however, this does not impact vendor rankings.  Vendors receiving better scores in higher weighted criteria will benefit in terms of an improved overall position.  Lower scores in higher weighted categories will result in a weaker overall placement.   

 

The rating scores assigned to each criterion are added up to determine a raw total score for Implementation and Innovation.  A mathematical formula is then applied to adjust for the 0 to 100 rating system and the number of criteria so that vendors can be positioned along the x- and y-axes (with a maximum score of 100).  The mathematical formula does not impact vendor ranking.

 

It is ABI Research’s policy not to publicly disclose individual vendor’s scores for each criterion.  However, we will accept requests to discuss individual scores with the appropriate vendor.

 

Rankings 

After individual scores for Implementation and Innovation are established using the above criteria, an overall company score is determined using the RMS (Root Mean Square) method:

 

The resulting overall scores are then ranked and used for percentile comparisons.

 

The RMS method, in contrast to a straight summation or average of individual Implementation and Innovation values, rewards companies for standout performance.  For example, using this method, a company with an Innovation score of 9 and an Implementation score of 1 would rank considerably higher than a company with a score of 5 in both areas, despite the mean score being the same.  ABI Research believes this is appropriate as the goal of these matrices is to highlight those companies that stand out from the others.