SNCF teaches OTT lessons

All aboard! France’s SNCF wants your cheeks on a seat – but not necessarily on a train.
With Olympics trade in mind, the French rail giant just launched a Paris-to-London coach service. Branded idBus, the service claims a four-star experience at a two-star price.
An odd move for a global leader in rail transport?
It’s actually an important object lesson in fighting OTT that telecom operators can learn from.
  • LESSON 1 – If you can’t beat them, join them
This is OTT realpolitik: SNCF is fighting disruptive competition on many fronts. Low-cost airlines like Easyjet and Ryanair, [and coach firms including] Megabus and Eurolines offer cut-price travel to students and other budget-conscious travelers. Sweeping changes in EU transport rules mean that various passenger and freight routes are now up for competition.
  • LESSON 2 – Make it simple
No confusion marketing here: SNCF’s idBus prices are fixed with no hidden extras. Paris to London costs between €49 and €65. Until the end of 2012, a third of seats on all idBus European routes will cost €5. SNCF thinks this will attract up to a quarter of a million passengers and 75% occupancy in 2012.
  • LESSON 3 – Focus on customer experience
It’s not cattle herding: The idBus fleet offers luxury coaches with generous legroom, wheelchair access and customers can choose their seats. Technology is a critical differentiator: Each bus offers totally free Wi-Fi with in-seat power sockets for connected devices (Eurostar won’t limp into the Wi-Fi era until 2013*). Customers get real-time information on their route since each coach is tracked via GPS.
  • LESSON 4 – Think outside of your box
Driving this initiative is a new recruit: Barbara Dalibard. Now boss of SNCF Voyages, she helmed Orange’s €7.1 billion enterprise division Orange Business Services until 2010. She’s injected fresh ideas into the incumbent of a mature industry.
Sound familiar? This kind of lateral thinking is exactly what the telecom industry needs to embrace.  As SNCF’s example underscores, telecom innovation can bring dynamism into adjacent industries – but telecom can also learn by interacting beyond its traditional borders. Understanding this is the real fast-track to success in OTT and Connected Verticals.
*Working with Bouygues Telecom, Orange and SFR, Alcatel-Lucent has just implemented technology for Eurotunnel to support mobile connectivity– but only in the Channel Tunnel.
For further discussion of these issues, the white paper: Connected Verticals: Opportunities in Transport and Energy is freely downloadable from Slideshare, along with other content from Informa’s Enterprise Verticals research and consultancy practice.
Camille Mendler is a principal analyst for enterprise verticals at Informa Telecoms and Media. For more information, visit