Thursday, December 23, 2004

The end of 2004, the emergence of a mobile future, operators need to collaborate?

Over the last year there have been some really exciting developments in the mobile industry - each and every day I have seen more and more evidence of the foundations of what the future of mobile is going to look like. The buzz words are location, blogging, podcasting, presence, video, pictures and context. Start-ups have begun exploring these niche areas and are developing services to connect mobile users together according to their interests, tastes, location, music. Few however, appear to have connected the different media together in to a comprehensive mobile experience. Its early days though, and perhaps plans for 2005 and beyond address this. It comes as no surprise that these developments are happening outside of the operators’ product development teams. They're happening in small start-up companies based in Calfornia and Israel.
Operator collaboration:
A key success factor for these kinds of mobile experiences is that they function across operators that they interconnect with multiple networks. You can’t leverage the "network effect" unless you have access to all customers on all networks. This may prove hard for some operators to swallow, and a mind-shift may need to take place before these kinds of mobile data services take off. The operators have traditionally developed, launched or endorsed data products which are exclusive and wihtin the "walled gardens" of their own networks. For example, many operators spent millions developing proprietary IM services. It took a while before they realised that a proprietary IM network goes against the whole principles of a networked application. For IM to fly, you need interconnection with existing IM services such as MSN, ICQ etc. Other examples are Chat, Email and Calendars. The mind-set is still unfortunately commonplace.
Operator bypass?
Mobile operators need to collaborate more to drive data usage and increase revenues. The success of the Internet was mainly down to the fact that it was a network of hardware and software that talked a common language - this fosters an innovative environment where external parties can develop new products and services which are accessible by all.
Clearly, there are a different set of considerations for the mobile operator, however, they must start to at least investigate and understand the new possibilities of cross-operator collaboration. They have been doing it for years with roaming; SMS, MMS etc - and these are the services that account for the lion’s share of revenues.
Some start-ups have sensibly decided to bypass the operators. I've seen beta ready messaging clients that incorporate IM, PTT, Email, Content and Address books, in to a single application. You download it via the web, and you effectively have messaging capabilities for the price of a few Mbs of GPRS traffic each month. This should be giving operators the heebie-jeebies but most are still focused on defending margin and protecting market share. I suspect that the MVNO's will be the first to embrace new business models and these emerging data services. A few years from now we will see a very different landscape. This is why it is such an exciting time to be in the mobile industry - the boundaries, business models and value-chains are changing. I’m fortunate enough to be in a position where I can witness this change and participate in it. Bring on 2005!

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