TMCnet - World's Largest Communications and Technology Community



IMS Magazine logo
Aug/Sept 2008 | Volume 3/Number 4
Publisher's Outlook

Show Me the Opportunities!

By Rich Tehrani 
This past week had me thinking about telecom and how it’s evolving. I’ve come to some conclusions worth sharing. The first is that customers could care less about walled gardens. Sure, we hear complaints from some about how walled gardens are bad – but consumers don’t care. What they do care about are much more simple things that we often forget.

Ease of Use

Skype (News - Alert). Microsoft, the world’s most powerful software company, launched NetMeeting, one of the world’s first VoIP software packages. Its problems: a terrible interface and difficulty in connecting to other users. Skype subsequently appeared. With its easy -to-use interface and a feeling of “fun”, it took over the market. Ironically, Microsoft (News - Alert) had an open H.323-based solution, and Skype chose to be proprietary. Still, Skype became the success NetMeeting should have been.

Apple (News - Alert). Many people in the technology space left Apple for dead and the company amazed us all when they launched the iPod phenomenon. They changed the way the world consumed digital music by making them actually start to pay for it and, moreover, owning an iPod became a status symbol. A fashion accessory, if you will.

Having tried to acquire an iPhone (News - Alert) for over a week, I can tell you firsthand that Apple is doing something we’ve never seen in the communications market. Amazingly, even people who were “anti-Apple” are now buying these devices or at least trying to.

Apple has done many “IMS-like” things such as allowing applications from disparate developers, and in exchange for customer access; they pay Apple a fee per sale. As Apple grows its iPhone business, it’s poised to change the face of telecom. RIM could be immune for a while because Blackberries have keyboards and Apple’s don’t at the moment, but other device makers are probably in big trouble. Nokia (News - Alert) , interestingly, has done a better job of innovating in the device space than Apple but the market – especially in the U.S. – seems apathetic. Apple can do no wrong and they have produced a single device that’s becoming the envy of the world while Nokia has laundry lists of devices about which consumers aren’t passionate.

Could my analysis be wrong? Consider that Sony Ericsson (News - Alert) posted a 97% drop in Q2 profits and cut 2,000 jobs. Even so, Apple isn’t immune to competitive threats. One hot download for the new iPhone is Pandora (News - Alert), which enables users to design their own streaming radio station. Pandora could potentially reduce iTune sales. And media seems to be where much of the money is in this business.

These opportunities face financial challenges as devices gain WiFi access, and then there’s the challenge of TiVo (News - Alert) – the company enabling the recording of television and its viewing on mobile devices. How does a service provider add value to this relationship? Landmines lurk everywhere for service providers, but so do tremendous opportunities. After all, one million people signed two-year contracts for iPhones in a few days. Because of devices like iPhone, consumers realize they can indeed surf on-the-go, thanks to touch-screen technology.

The good news: mobile data consumption will continue to grow rapidly. But to make money in this new environment, providers must focus on entertainment, among other things. They also need to start getting good at something they haven’t excelled at in the past – the user interface. SPs have often told me they don’t just want to be dumb pipe providers, and yet they simultaneously ship products on their mobile networks which stink.

That Apple could enter the mobile phone market and do so well – 20 years behind competitors – demonstrates our need to rethink everything. The world is changing rapidly – social networks, Web 2.0, mashups, obsessive-compulsive media consumption and many other trends are changing how we use broadband connections – both wired and wireless. The opportunity for service providers is to find ways to help customers get the most out of their disparate connections– DVR, music services, p2p networks, social networks,IM, SMS, email, web surfing, etc. The complexity involved in integrating all of these technologies is bewildering but in the end, customers want things that work and are easy…This is the lesson Skype and Apple have taught us.

When formulating new business plans, keep in mind simplicity, ease-of-use, and the “cool factor” to appeal to consumers. Walled gardens services are great if they are easy to use and have the sex appeal needed to capture the audience’s attention. The telecom world has changed and if you haven’t paid attention these past few years and months, you better start soon.

IMS Magazine Table of Contents

Technology Marketing Corporation

2 Trap Falls Road Suite 106, Shelton, CT 06484 USA
Ph: +1-203-852-6800, 800-243-6002

General comments:
Comments about this site:


© 2020 Technology Marketing Corporation. All rights reserved | Privacy Policy