There’s a new free whitepaper, Mobile Internet 3.0 How Operators can Become Service Innovators and Drive Profitability at Jupiter Networks (pdf) written by Chetan Sharma. The focus of the whitepaper is that operators that choose to remain a utility will see margins pushed downwards by 30-50%. Instead, they need to compete and collaborate to bring added-value to data.
While the whitepaper is immensely useful, there’s one area on which I am less convinced. Chetan talks about the need for innovation, "starting with the mobile packet core" and building out new APIs that developers can use to create products and services that can create new value via collaboration. As Chetan says "opening up of the network for innovation necessitates re-architecting the network elements".
Having worked in a network operator (Vodafone) myself, I am not sure this is practical. There are huge technical and logistical problems. Most of the network elements are supplied by third parties and cannot be re-architected by the network operators themselves. They are very complex products in themselves, often contain lots of legacy code and aren’t amenable to re-construction to create new apis or provide new data for (network operator) customers.
Then there’s the network operators themselves. They move very slowly. They tend to be so huge that adding just one product requires cooperation between so many departments that it becomes an gargantuan task. Operators know a lot about service provision, billing and customer care but very few have the aptitude or skills to manage complex value added services.
Even when these APIs appear, they will find that unless they are the same across all network operators, it’s unlikely developers will use them due to the complexity of supporting too many interfaces.
So what should network operators do? What should mobile developers be doing?
It’s still possible to provide new APIs at the fringes of the network as BlueVia are ably doing. Network operators need to buy-in or acquire, largely self-running, services that can sit on top of the smartphone platforms and provide personalisation that not only provides added revenue but also dissuades consumers from moving to other network operators.
There’s a large opportunity for mobile developers to create these services. Only a few years ago, it was very difficult for a developer to get heard by network operators. When they were heard, negotiations took literally years. Today, the more forward-thinking network operators are more welcoming and want to get things done quicker. So who are these network operators? This is where the whitepaper becomes immensely useful. There’s a chart showing their relative use of mobile data…
Also look for operators such as Telephonica and their BlueVia who are already innovating at the fringes of the network and by implication are looking for complementary services to buy-in or acquire.
I also recommend you take a look at the whitepaper to discover the key mobile application and service areas that are ripe for network operator innovation.