I attended the MWC in Barcelona a few days back, one of the hottest topic I noticed is the effect of OTT apps on Operators bottom lines. The theme seems to have centered across how OTT cannibalizes traditional voice and messaging revenues. Is OTT really the culprit of shrinking revenues and margins for mobile network operators or is it their failure to understand what app-economy meant to them and how they can benefit on advancement of social media? How can existing operators co-exist with OTT players? Coexistence is the key, since no matter what operators do, OTT applications are here to stay, if one disappears 2 more starts-up on garage somewhere.
Ericsson pointed out that the differentiators is in Customer Experience, also pointed out during their Key Note speech that in a few years the average usage of data will be 20MB per day. I tend to disagree with the statement of being a few years, the 20MB of data on smart phone users is already here, not even on billable data but more importantly non-billable data in form of advertisement to various smart phone applications. With advertising Google wins, and so does app developers, however Mobile operators loses, either they can't bill the data used by advertising going to devices or if they of customers complain about too much usage being billed. Most customers are not aware that their devices used so much data traffic and are only aware of the known data traffic coming from browsing and email… Social media is even considered by customers as free data, their right to use it without cost.
For operators what is the solution? Is there a holy grail of ensuring Customers are Happy and at the same time their network is not used as a free pipe for advertiser? Today most operators will give unlimited or high data plans to combat this, however this are expensive and only a small potion of the customer base can afford it. Some provide specific services for use of OTT and others go on the wrong path of not allowing OTT services to run on their networks.
My perspective is its all about discovery, knowing how your customers experience and interact with these OTT applications then designing services that addresses high free data usage. Discovery requires robust solution capable of extracting customer usage down to applications installed on devices and actual network usage, of course also ensuring that traditional usage like browsing and email are taken into account. Discovery is one thing, taking action on what ever is discovered is another, I think its called by a jargon named "Actionable KPIs). Question is what actions can be done? Should operators disallow OTT? Should they bill for such usage? What about advertising which uses the most data, just imagine all the angry birds applications that are receiving advertising on the background right at this moment? Perhaps the key is to stop advertising from reaching the applications, however if we do that Google and the whole industry of mobile and device advertising will never be happy…. As an operator are you ready to pick your battles?
Ericsson pointed out that the differentiators is in Customer Experience, also pointed out during their Key Note speech that in a few years the average usage of data will be 20MB per day. I tend to disagree with the statement of being a few years, the 20MB of data on smart phone users is already here, not even on billable data but more importantly non-billable data in form of advertisement to various smart phone applications. With advertising Google wins, and so does app developers, however Mobile operators loses, either they can't bill the data used by advertising going to devices or if they of customers complain about too much usage being billed. Most customers are not aware that their devices used so much data traffic and are only aware of the known data traffic coming from browsing and email… Social media is even considered by customers as free data, their right to use it without cost.
For operators what is the solution? Is there a holy grail of ensuring Customers are Happy and at the same time their network is not used as a free pipe for advertiser? Today most operators will give unlimited or high data plans to combat this, however this are expensive and only a small potion of the customer base can afford it. Some provide specific services for use of OTT and others go on the wrong path of not allowing OTT services to run on their networks.
My perspective is its all about discovery, knowing how your customers experience and interact with these OTT applications then designing services that addresses high free data usage. Discovery requires robust solution capable of extracting customer usage down to applications installed on devices and actual network usage, of course also ensuring that traditional usage like browsing and email are taken into account. Discovery is one thing, taking action on what ever is discovered is another, I think its called by a jargon named "Actionable KPIs). Question is what actions can be done? Should operators disallow OTT? Should they bill for such usage? What about advertising which uses the most data, just imagine all the angry birds applications that are receiving advertising on the background right at this moment? Perhaps the key is to stop advertising from reaching the applications, however if we do that Google and the whole industry of mobile and device advertising will never be happy…. As an operator are you ready to pick your battles?
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