Those expecting major announcements from operators on new approaches they’ve devised to react to the fast-changing landscape of the telecoms industry would have been disappointed at Mobile World Congress 2013.
But despite the absence of a major announcement from any of the big operating groups, something that has come to be a hallmark of MWC, some of the major players did provide some detailed insight into their broad strategic near-term goals. Telefonica, Vodafone and DoCoMo this week each communicated how they see their businesses evolving to meet the new challenges they face in identifying new capabilities and opportunities, and how they are reviewing their core businesses. But how much of it was new thinking?
Operators revisit old concepts at MWC ‘13 to sketch out new objectives
Cesar Alierta, CEO of Telefonica, kicked the MWC week off by saying that the mobile industry needs to re-position in the mobile services value chain. On the face of it, these comments would no doubt have been met with another roll of the eyes by companies that have created the services people want to use on their smartphones, using what Alierta referred to as an unlevel playing field. Alierta’s comments could have been made any time in the past five years, and his suggestions that operators should now focus on offering enhanced connectivity embodies a strategy that has been emerging among telcos during this time.
Looking more closely, that Alierta suggested operators should focus on offering simplified tariffs built around an “enhanced customer experience”, which actually shows how far operators have already gone in losing the battle to provide services consumers want to use. The fact is that mobile operators have already sunk significant resources into building applications and environments for mobile consumers, who have overwhelmingly chosen not to use them. Twitter, Facebook, Google’s suite of services, the Android and Apple app stores are probably some of the main reasons people actually buy smartphones – not for any service developed by telecoms operators.
So what’s operators’ latest thinking on how to meet these challenges? Operators, Alierta says, now need to compete by offering the best quality experience of services. So the question that arises is: when will the mobile industry listen to Alierta’s often-sounded battle cry? The answer is, it’s already happening. Some operators, including Telefonica with its Telefonica Digital unit, are well advanced into looking at how they can use their networks in new ways to differentiate and add value to end users, a strategy based around new organizational structures that is gradually finding favor with other major telcos.
Indeed, Vodafone and DoCoMo made announcements that heeded Alierta’s call for operators to focus on core assets at least as much as trying to beat Internet companies at their own game in services. In comments similar to Alierta’s, Vodafone CEO Vittorio Colao and NTT DoCoMo CEO Kaoru Kato each said this week that they plan to focus on core telecoms services as a platform for new services to grow revenues. In the case of Vodafone, this is offering unified services – fixed and mobile services – in core European markets, making acquisitions where necessary. And for DoCoMo, it is opening up its networks to allow partners to develop services within eight core vertical markets, and again, making acquisitions where necessary to fill the gaps.
Whether these strategic goals, none of which are new, actually bear fruit depends, as always, on how companies execute on them. New core telecom services, opening up the network to partners to leverage core network assets, and making acquisitions to plug gaps in capability have all been around for several years. Whether operators can actually now make good on these goals will require them first to change their corporate mentalities – before anything else, becoming organizationally more aligned and nimble to realising these new opportunities. In the absence of this top-level strategic thinking, we can expect more strategic announcements with a strong echo of what we heard this year, rather than evidence of success of initiatives underway, in subsequent MWCs.
Joyn RCS services start to gain traction
MetroPCS announced this week that it will use mobile cloud communications provider Jibe Mobile’s Global Communications Cloud platform to enable its Joyn users to invite non-MetroPCS subscribers to download a Joyn-compliant client for their mobile device and to use MetroPCS’ Joyn service.
The move is intended to increase the addressable user base of Joyn services outside
of its own subscriber base, which is important since MetroPCS is a Tier 2 carrier in the US, with an estimated 8.7 million subscribers according to Informa Telecoms & Media. The operator states that the Jibe platform should allow it to offer its Joyn services in areas covering a population of about 280 million people.
So far only Vodafone Spain and Telefonica Spain have received full accreditation; the other networks with provisional accreditation are Vodafone Germany, Vodacom South Africa, Orange Spain and Deutsche Telekom Germany.
MetroPCS’ move is the latest evidence that Joyn services are gradually gaining commitment from operators worldwide. Almost 12 months after Vodafone Spain became the first mobile operator to officially launch Joyn, South Korea’s SK Telecom recently announced a fairly impressive 1 million downloads for its Joyn.T service, just 50 days after it was launched in December 2012.
The SKT numbers, along with MetroPCS’s move to expand its Joyn reach, give Joyn a much-needed boost, coming as it does within weeks of Deutsche Telekom being forced to issue a clarification about its delayed launch of Joyn services in Germany. DT said that an error in translation resulted in the reporting of an “indefinite delay” in the launch of Joyn in Germany, which was originally scheduled for December 2012, when in fact the operator had simply declined to state a new launch date. Informa understands that DT is currently conducting a sizeable user trial of the live service on its network, and that a launch is imminent.
For Joyn to take off operators need to work together to ensure interoperable services are launched by as many operators in a given market as possible. If operators approach Joyn on a piecemeal basis, offering only islands of usage, then Joyn will struggle to realize the potential it has to lure mobile users away from Internet-based enhanced communications services. In 2013, operators will need to work together in ways they have often found difficult in the past to give Joyn the best chance of success.
GSMA research reveals 30m active mobile money users in 2012
The GSM Association’s second annual Global Mobile Money Adoption Survey has found that there were 30 million active users of mobile money services in June 2012, who between them made 224.2 million transactions valued at $4.6 billion. By comparison, Paypal customers generated an average of 196.3 million transactions each month during 3Q12, the GSMA said. These figures show the potential for new mobile-based payment services to gain further traction, and the GSMA will be closely examining data from its MWC ’13 NFC trial to gauge attendees’ willingness to use mobile as an alternative to traditional payment and security systems.
The majority of registered customers, 56.9 million, are in sub-Saharan Africa, where 34 out of 47 countries have live deployments, and where 37% of the 166 mobile operator networks have launched services. In addition, there are more mobile money accounts than bank accounts in Kenya, Madagascar, Tanzania and Uganda, and more mobile money agent outlets, 520,000, than bank branches in at least 28 countries. Also, the number of mobile money agent outlets equals the number of Western Union points of sale. In Kenya, Tanzania and Uganda, the value of mobile money transactions was equivalent to about 60%, about 30% and about 20% of total GDP, respectively.
Paul Lambert is a senior analyst for operator strategies at Informa Telecoms and Media. For more information, visit www.informatandm.com/