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.
In today’s world of instant Internet gratification, speed is undeniably a critical component of the customer experience with a mobile operator’s service. How quickly one can upload or download things, especially video, has become an important brand differentiator among service providers that are moving to 4G networks to keep pace with consumer demand for faster network response times.
But operators that rely on network speed as their primary differentiator may find it a short-term gain. As more service providers build out their LTE infrastructures, speed will becomes more commoditized. Also, if network congestion occurs, operators risk brand erosion that can lead to subsequent churn.
The primary asset that operators possess is their networks. How do operators turn that asset into something meaningful for subscribers beyond speed? The answer lies in a personalized experience with a predicable quality of experience required for video and content services.
Personalization can build the relationship between an operator and its subscribers, and can involve offering customers a wide range of services and applications from which to personalize their service plans. Those personalized services and apps need to be supported by the operator’s OSS/BSS.
For years, much industry discussion has been devoted to how mobile operators insert themselves into the mobile value chain. One clear option has always been to work cooperatively with over-the-top service and content providers to leverage the power of their network to deliver a personalized experience when users interact with a third-party app or service.
To foster that cooperation, operators can expose their network APIs to OTT players to achieve three primary objectives related to monetizing LTE:
–Subscriber plan information: Adhering to strict industry privacy standards, operators can provide anonymous information on subscribers’ plans to help OTT providers to ascertain how to deliver their service. For example, does a subscriber have a low- or high-bandwidth LTE plan? If a subscriber has a lower-bandwidth plan and is attempting to stream a high-definition movie, the service delivery will suffer. In this case, the personalized experience will be negatively impacted for the end user, OTT provider and ultimately the operator as end users complain about the service delivery. With subscriber plan information, along with an OTT provider agreement and integration, operators can dynamically provide the customer with more bandwidth and monetize that personalized service offering through its online charging platforms.
–Bandwidth controls: Operators can enable OTT players to access “bandwidth on demand” to deliver the personalized experience that matches the service they have sold to the customer. Following the example, if a low-allocation subscriber wants to stream that high-def movie, a third-party provider can bundle a “bandwidth boost” feature with its service to aid in the download.
This flexibility represents a significant upsell opportunity for operators and OTT players when subscribers choose to access additional bandwidth.
–Real-time charging capabilities: Operators can charge on a “per-service” or “per-app” basis in real time, leveraging its trusted relationship with their customers. In this case, operators can offer their real-time charging capabilities to third parties to deliver highly scalable, trusted charging as well as provide usage notifications to prevent potential “bill shock.”
With real-time charging, users can be notified before they burn through their usage limits or worse: see dramatic overages on their monthly bills. This practice to curtail bill shock is already instituted in most European countries, where operators are required by government regulation to contact subscribers who approach or exceed their plan limits.
While real-time charging is in regular use for prepaid customers, LTE services will require that all post-paid customers are charged in real time initially for all of their data services, and ultimately for all of their services usage, voice, data and partner OTT services.
Operators need a “service aware” OSS/BSS that opens up their charging and policy APIs to OTT players, tailors bandwidth requirements to specific apps and delivers the service quality that ensures a predicable QoE. Using an extreme example, offering 40 gigabits per second of bandwidth for e-mail downloads is not required. It is not properly monetizing the network. However, being service aware enables operators to use their network assets more efficiently and only allocate the bandwidth needed.
An efficient deployment of network assets helps with traditional operational goals, such as lowering capital expenditure and operating expenditure demands. But the greater goal is moving toward rapid service creation and delivery, both of which contribute to the ultimate endgame of offering personalized services that better monetize LTE.
Key to offering personalized services are three key elements: Providing a diverse range of services from which customers can tailor their plan; giving subscribers control over how those services are delivered; and providing real-time authorization and control over payments, allowing customers to pay for services in a way that matches their lifestyle.
For the range of services, personalized charging and policy control enable the type of rapid service rollouts that operators must perform in a competitive marketplace. For example, a tier-one service provider in Latin America gained the No. 1 market-share position through regularly launching innovative services for its customers (ahead of its competition) with more than 60-plus new offerings in a single year. In this case, where average revenue per user typically is low, increased time-to-market becomes the operator’s profit driver and key competitive advantage in the launch of new and innovative service offers.
Regarding customer control, most subscribers want up-to-the-minute visibility into their mobile broadband service usage with the ability to manage how and when service is delivered, notifications are given, etc. Subscribers need (and want) to control what they are consuming over that service. Providing usage reporting that is one day old or even one hour old can be an issue if a mobile device is consuming bandwidth for services without the subscriber’s knowledge and driving charges as usage allowances.
If an operator offers a special promotion to a subscriber who accepts it, that customer will want to immediately see if the appropriate charge was made. The customer also may want to charge the service to a personal mobile prepaid account or mobile wallet and not to their post-paid personal or employer bill.
Subscribers basically want the same level of control and transaction awareness that they have with online purchases, where notifications are instant. This issue becomes very relevant in households where families share mobile plans or there are multiple mobile devices per user.
To accomplish more mobile personalization and control for subscribers, operators must create flexible, compelling service offerings and charge for them in real time. They can leverage OTT promotions and services to give subscribers additional value. Lastly, they need to scale their offerings for their entire customer base, regardless of size.
By focusing on personalization and the customer experience versus speed (which can become commoditized over time); operators can achieve greater profitability by creating brand loyalty and delivering innovative services that improve the customer experience and command premium prices while differentiating themselves from the competition.
Robert Beaumont is Americas Marketing Director, Service Delivery Solutions, Telcordia, now part of Ericsson. Beaumont is responsible for the solutions marketing of service delivery and charging solutions along with regional marketing responsibilities for the Americas. Beaumont has 25 years’ experience in telecom and IT with a broad set of leadership roles spanning across marketing, product management, business development, program management, development, support and operations in market leading organizations such as Ericsson, Telcordia, Cisco, CompuCom, jNetX, Nortel and Bell Aliant. He has had the privilege of engaging and working with the world’s most valuable mobile and fixed brands in defining innovative solutions to meet their business needs and business challenges.
