To Green or Not To Green — Technology Companies Begin to Measure Returns on Environmental Investments, Notes Frost & Sullivan

LONDON, January 20 - While many argue that the economic downturn has caused companies to push
the 'green agenda' down the priority list, a recent study by Frost & Sullivan
reveals that companies in the ICT sector are actually paying more attention
to environmental initiatives — to save cost and improve competitive
differentiation as well as enforce brand loyalty. However, given the tighter
budgets and higher stakeholder expectations, such initiatives need to
demonstrate a positive ROI.

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In its third annual edition, Frost & Sullivan's study
(www.wireless.frost.com), Sustainability in Telecoms: Return on
Environmental Investments, focuses on a selection of companies that have
adopted a longer term, measurable and sustainable way of doing business. In
the 2008 year study, we highlighted the multi-stakeholder relationship,
provided case studies of eight leading European telecommunication service
providers and reviewed key vendor initiatives. In this study, we identify
further best practices and discuss measures for returns on eco-investments.

While the first section of this study profiles certain service providers
(British Telecom, France Telecom, Telefonica and Swisscom) and vendors
(Alcatel-Lucent, IBM, NSN, Ericsson and Huawei) based on their notable
efforts in the sustainability space, the second section discusses positive
versus negative environmental investments and reflects on the fraught notion
of conflicting commercial versus environmental priorities.

It is encouraging that most of the companies that participated in the
research have started to develop their own frameworks and even gone ahead to
seek accreditation from various industry bodies. Unfortunately, none of the
companies interviewed were willing to share the measurement models used.

"IBM seems to be the most advanced in its measurements of environmental
investments while British Telecom should finalize its ROI models for a range
of solutions in the run up to the 2012 Olympics," says Frost & Sullivan
Principal Analyst Sharifah Amirah. "In the longer term, social and
environmental investments will start to feature in a company's financial
statements/audited reports, similar to the triple bottom line accounting
approach."

However, even companies with very advanced environmental strategies are
only just beginning to develop measurement frameworks for their green
investment. The reasons behind this include the lack of standard measures,
the difficulty in measuring non-tangible benefits, and the fact that eco
investments tend to be perceived either as a marketing or corporate social
responsibility (CSR) exercise.

Further, greater scrutiny over environmental investments does not
necessarily suggest that companies will only invest in initiatives that
demonstrate positive returns. Nonetheless, at the company level, greater
commitment and concrete initiatives need to take place. Given the growing
need to justify these investments, formal measurements too have to be
designed, standardised and adopted.

"The amount of environmental investments in the ICT sector should at
least double in the next 2-3 years," says Amirah. "Despite the lack of
concrete frameworks at the 2009 Copenhagen summit, individual governments,
stakeholder and consumer pressure will continue to drive businesses to adopt
more sustainable operations."

In fact, a cross vertical enterprise survey conducted by Frost & Sullivan
at the end of 2008 revealed that close to 600 business leaders expected to
increase their environmental investments by 67 percent over 2009-2010. A
majority of them saw it not only as an ethical obligation but also as being
critical to growth.

If you are interested more information on this study, please send an
e-mail to Joanna Lewandowska, Corporate Communications, at
joanna.lewandowska@frost.com, with your full name, company name, title,
telephone number, company e-mail address, company website, city, state and
country.

Sustainability in Telecoms: Return on Environmental Investments is a part
of the Market Insights - Mobile Communications subscription, which also
includes research on U.S. Mobile Financial Services, Global Mobile VoIP
Market, North American Mobile Messaging Markets, E-Healthcare in Western
Europe, among others. These Market Insights are part of Frost & Sullivan
Growth Partnership Service.

About Frost & Sullivan

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        Sustainability in Telecoms: Return on Environmental Investments
                                   9838

    Contact:
    Joanna Lewandowska
    Corporate Communications - Europe
    P: +48-22-390-41-46
    E: joanna.lewandowska@frost.com

www.frost.com

Joanna Lewandowska, Corporate Communications - Europe, of Frost & Sullivan, +48-22-390-41-46, joanna.lewandowska at frost.com