Editor’s Note: Welcome to our weekly Reality Check column. We’ve gathered a group of visionaries and veterans in the mobile industry to give their insights into the marketplace.
We never thought we’d see a parallel between wireless operators and team sports, but today that parallel seems highly appropriate.
Whether it is football, basketball or any other team sport you care to mention, successful teams are based on large talented teams. All the individuals in the teams work together, train together and play together with the goal of beating the other teams. But there’s a difference between being on the roster, and being in the starting line up. Your teammate in all the practice sessions and in the match is also one of your rivals for the starting spot.
In today’s highly competitive, app-centric wireless world, the wireless operator community is under threat from a host of over-the-top players who are taking advantage of the smartphone generation to sell products and services directly to customers who – when it came to mobile services – previously only had one financial arrangement, with their operator.
Enter the common enemy!
Operators today therefore are realizing that they need to act as a team. They need to use the power of a common approach to combat the threat of the OTT brigade. But just like in team sports, beating the common enemy alone is not enough – you’ve also got to have an edge over your teammate.
The worldwide trade body for the wireless operator community, the GSMA, has been making some good progress developing and promoting its rich communication suite, which aims precisely to give operators some common tools to compete against the OTT players.
With RCS in place, operators can easily and quickly launch new, value-added services directly to their customers – opening up new revenue streams with advanced messaging services, location-based promotions and improved voice services over mobile broadband connections. If an operator is able to offer international calls using a voice over mobile broadband client at a similar price to offerings like Skype but with a higher call quality, for example, then it would seem natural for customers to stick with their trusted operator for the service.
In fact, operators could do a lot worse than introduce Skype-style services quickly. Our own analysis and research shows that Skype is actually far more bandwidth hungry in mobile broadband terms than operator provided voice over HSPA. That means an operator competing against Skype with a voice over HSPA client could carry more of its customer’s voice traffic and yet use less of its precious broadband capacity. Freeing up the data capacity on high-demand mobile broadband networks while improving customer service is surely an opportunity that is not to be missed.
Just like in teams, besides working together to level the playing field and create a basis to compete against the common foe, operators also need to compete against each other (for that starting position) on a service-led battleground, not a pricing-led one.
Of course one way to steal a march on your teammate is to be the first one off the bus or the first one with all the playing kit. The ability, therefore, to launch RCS-like services in a pre-RCS world is much prized. Those operators able to cleverly make use of cloud-based developments to introduce valuable new voice or messaging services that can seamlessly migrate to an RCS platform will undoubtedly get first mover market advantage.
While RCS will eventually level the playing field for all those in the operator community, being first still counts for something – not least in terms of learning about the services. When the service portfolio across the operator RCS community begins to look the same, the operator with the most elegant implementation is most likely to be the one who is best able to maintain a price advantage – and that is when the lessons of early service experience might become most valuable.
What’s also certain is that the OTT players are not hanging around waiting for the operators to catch up – they are forging ahead designing and introducing services for fun, usually based on the freemium model that gets the customers hooked and then extracts the value.
But there are close to 800 wireless operators in the GSMA community and they cover more than 200 countries – so that’s a very powerful squad indeed. If they all pull in the same direction, and the signs are good with the RCS initiative, then that becomes a very powerful force with a potentially winning strategy.
So the question is – who wants to get a head-start and earn a place a starting line-up? Watch this space for those operators making some early RCS-like moves.
Pardeep Kohli, President and CEO, Mavenir Systems, is a wireless industry Veteran with 18 years of experience. Pardeep, as co-founder, President and CEO, led Spatial Wireless, the mobile next generation networking market leader, to broad success across the US market. Following the acquisition by Alcatel, as SVP of the Mobile NGN business, Pardeep led the continued expansion and success of the Spatial Wireless product across the global market place. Pardeep has worked in multiple roles at NEC America, DSC, Alcatel and PacBell. While at PacBell, Pardeep participated in the technology selection and network implementation of the first large U.S. GSM network.