Telco 2.0 Notes – Verbose

The world’s first Industry brainstorm on telco’s biggest challenge: How To make Money in an all IP-based world?

Part of the overview states that IP is changing the game. The lines between industries is blurring and everyone is after the same consumers.Vertically integrated business models are under attack from all sides, tougher regulation, new technology (most notably VoIP and open spectrum), disintermediatory new entrants and advancing customer expectations.

From the booklet handed out I noticed the ‘Why it’s different’ section (the event that is)

  • Industry Brainstorm stimulated by senior industry speakers
  • Group interactivity using collaborative technology integrated with panel discussions
  • Short, pre-screen presentations
  • Expert facilitation by senior consultants/analysts
  • Laser-targeted individual participant invitation process
  • Interactive breakout groups to get to the bottom of key issues
  • Original market research conducted before the event
  • Dedicated blog support

The quote on the same page interests me “this event seems like a breath of fresh air after all the traditional (and traditionally boring) conference I am used to attending” – Marketing Director, Major Operator

This is the worlds first time ever so I have to assume he is talking about what it will be like…

My own initial impressions of the event were marred by the fact that there was no free wifi, it’s too expensive from the hotel the organiser told me, first one I’ve ever been to that doesn’t provide it and even more ironic given the title of the event, I’m glad I got a free pass and didn’t pay £1500 for no wifi and no power provision either, on reflection I’m not sure how many more laptops would have been open if these things were in place though given that I was almost the only person not wearing a suit or at the very least a shirt and tie there. On top of this the BTOpenZone access doesn’t work either so that means no connectivity full stop. The event is co-hosted with the IMS services forum whom we share breaks and lunch.

After the usual opening logistics we were asked to introduce ourselves to the other people at our tables in a Name, what you do style, at my table are :
Annette – Logica CMG
David Wibbington – Alcatel – IMS
Berit Svendsen fixed – Telenor Nordic
Norman Lewis – Orange Home

Berit gave us what turned out to be some stats from her presentation but interesting all the same, Telenor is seeing 10-15K fixed subs moving to mobile or VoIP (15% households using VoIP now )

The event is designed to answer two primary questions Simon Torrance, CEO of STL and founder of the Telco2.0 Initiative informs us, namely:

  1. how do Telcos create long term growth
  2. how do new players make money

STL ran a survey of over 300 companies to assess this – 92% said strategic rethink of the role of the operator required. They have also created a manifesto that lays out the background to this issue and has an accompanying blog that claims to be teasing out the answers or at least providing new ways to think about the question. There are several reminders that we should be wise enough to buy the report they have created too. During the event we will be using the unique Mindshare technology developed by STL, which enables a genuine brainstorm’ for large groups of people, no death by powerpoint. The system consists of small devices on each table (using WiFi ironically) that allow anybody to anonymously enter data into four categories, Plus, Minus, Interesting, Questions. At the end of the (powerpoint) presentations for each session the crowd are encouraged to enter their thoughts, observations or questions into the system. Will see how well this concept works over the course of the event.

Simon goes on to lay out some of this over the next few slides introducing topics such as that we are in a new world where the user drives the selection of device. services/applications, connectivity and distribution, Investors believe it (Telco2.0) has a long term sustainable basis for growth in an all ip world but what are the new metrics for measuring success?

In STL they have chosen some early runners for who is doing well at Telco2.0 right now:

  • Verizon
  • Digium/Asterisk
  • AIM
  • DoCoMo
  • AQA
  • BT
  • Helio
  • Tesco
  • Iliad
  • Sony Mylo

Next we are asked if we need more Purple Cows (marketing term for something that is remarkable and stands out from the crowd) before Simon introduces the Resident Analyst who is going to help us make sense of our input from Mindshare, a pundit if you will.

The following is my verbose notes taken in real time and edited now for grammar, mistakes etc and with my own thoughts where relevant in []

Investing in the Telecoms sector in a time of massive disruption

James Enck, telecoms analyst for Daiwa Securities introduces himself as the comic relief for the day and provides some background, he writes a blog and has predicted several things accurately in the past such as the emergence of Skype, his presentation is entitled “Ten Things i hate about you” and is based on the film of the same same (because in the end it’s a love story) but is effectively a distillation of common investor concerns.

  1. Telcos have lost control of their core product
    • in Norway picture of voice product sold next to frozen peas
    • so many VoIP providers, maybe the value is in the context as opposed to the actual voice
  2. Voice becoming a feature, not a service
    • Google homepage showing Buster which gives PSTN voice out from the homepage
  3. Telcos can’t grasp that consumers may not want what they’re being sold
    • let the consumer decide what they want, KPN selling 45% raw ADSL connections now
  4. Telcos thrive on scarcity – the future will be built around abundance
    • pipes+skype+vonage-$=nuts (we get the murdoch story $600 buy but google pays $900 for example)
  5. Command and control culture is dead, open APIs rule
    • describes aimpages
  6. Telco DNA is fundamentally unsuited to the current dynamics of content
    • YouTube – most subscribed channel ever ‘lonely girl 15’ (done by professional film crew though and not some 15 year old girl which disproves the user content hype IMO)
  7. Telcos expand their footprints physically not virtually
  8. – why didnt a telco buy MySpace (or many others) SKT bought Cyworld (?didnt they create)

  9. Telcos can’t innovate
    • We know this isn’t true, there is a lot of innovation that goes on but in a risk averse culture not much if any of it makes it to market
  10. Telcos shouldn’t try to innovate
    • they should stick to their core strengths – be a pipe !
  11. Maybe the entire foundation is wrong
    • broadband should be an amenity or a utility like gas or water etc etc

Next up on stage is Abdul Guefor, Managing Director at Intel Capital EMEA with some insights on investing in Telecoms

VC investments up 23% on H1/06 vs H1/05 and within that communications and networking up 147%

Key Investment trends noted:

  • web2.0
  • content and delivery platforms
  • semiconductors – DVB-H, NFC, WiMAX, handheld wifi
  • telecom equipment: optical, antennae, fixed-mobile convergence

Key Focus Areas

Next Generation Telecom technology

  • silicon, soft services for 3G, HSxPA, WiMAX
  • ip network infra
  • fixed mobile convergence, in-building coverage

Content and applications for digital home/mobile

  • service delivery platforms
  • e2e content delivery – streaming and broadcast
  • telematics

Mobility Enhancing technology

  • man machine interface
  • high capacity batteries, fuel cells

Why is Intel investing in WiMAX?

Need: users demanding broadband data on the move and perhaps 3G data is not the primary long term solution

WiMAX may be disruptive because putting a 3G card in a laptop has a BOM $100 plus additional costs, but WiMAX is cheaper and due to the wifi overlap means BOM for WiMAX may only be $10.

In emerging markets fixed broadband is not a viable option (cost of building in ground networks)

timing is always an issue but its coming together:

  • spectrum becoming available
  • standards agreed – nomadic standards agreed, 80.11d(?)
  • more equipment makers entering and reducing costs
  • 2007/8 intercept for Intel client devices

Opportunities & Threats

Disintermediation: LLU, WiMAX etc could erase Telco1.0

Embrace controlled chaos: open up your platforms – let users decide – Telcos are svengalis [ I’ve been saying this forever, we treat our customers like children always deciding what’s best for them or what they should or shouldn’t like]

Consider all the devices that could connect [yes we are doing this, not releasing it but looking at it]

“Talk to the rest of the world” is Abduls closing line

[pretty much a sales pitch for WiMAX but then he represents a vendor who is sponsoring the event]

“How can major operators grow?”

Gordon Smillie, Director, Group portfolio strategy at BT opens the session

Value Mitigation – convergence is at industry level

Convergence is fleeting – a new disruptive device can change the playing field which requires a rethinking of where the real value lies

Telcos need to look at which market they are really in and therefore where the value might be

New communities and business models impact telco revenue, click through advertising [this is old news after the recent BCG project]

He raises some fundamental questions:

  • How de we handle customer service
  • do we focus on connectivity
  • to what extent do we diversify
  • do we embrace applications and services
  • do we buy, build or partner
  • which segments shall we focus on
  • how do we manage change and multi-culture
  • what will we be famous for

‘not important decisions, but survival decisions’

BT is taking a radical view

  • playing in multiple industries
  • radical portfolio development
  • common capabilities and re-use
  • platform scale investments vs nimble service offers
  • bold moves into applications and services
  • huge cultural challenges e.g. skills, pace ……

[They are more prepared than any other operator I know, they have the right thinking about how to go about addressing the new market we are entering, unlike FT, it’s new thinking at a fundamental level backed up by actual change being implemented]

Rainer Deutschmann, VP strategy development Deutsche Telecom

Lots of stats on organic growth vs inorganic, de-layering of network leading to commodisation vs rich services

They want to head to a rich access world, they want to provide service access over any network access, but they give you the best pipe you need regardless of what device you are using.

on top of this they will do fixed mobile products like Unik

they want to integrate all their back end system to know all their customers regardless of which part of the organisation they belong to [like FT with Wanadoo & Orange ]

DT rich access service components

3×3 matrix
flat rate access
voice, internet, tv being the 3 main access methods
other ip services are layered on top

Final slide is showing exclusive content and services key differentiators, football league stuff, exclusive movies etc [like NTL broadband plus? which I’ve never looked at since I got NTL]

[This is much more like FT than BT which leads me to ponder if there is some form of simple arithmetic here … FT-DT=BT (think letters as numbers) but then I realise that this gives the wrong impression as it’s probably more like FT+DT<BT]

Telco competitors are now GYMAA, we’ve known this for some time now but they presenter on stage disputes this for some reason.

Smillie makes the excellent point that telcos are moving into the GYMAA area too, in fact everyone is merging into the same area, re-iterates the point that you need to decide what market you are in or want to be in.

Resident Analyst makes the point that Google is buying people rather than companies (Android for a Google phone for example)

DT states 4 points:

  • set scenario planning, where’s the value and what scenario gets there
  • enable organisation to be able to follow the scenario (people, change of mindset)
  • customer service changes are key from sales to service
  • governance needs to be changed in order to implement change (more corporate reorganisation)

BT adds their quick 4 points:

  • challenge is implementing across a large organisation, dont try to change everything at once
    the top of the company needs to have a sense of crisis, they need to be instilled with the fear that bad things will happen
  • understand what market you are in (brand extension, portfolio expansion etc)
  • understand what your assets really are
  • you need an incubation organisation rather than try and do new products across the whole group

[Gordons points ring very true to me, with the help of the now ex Wanadoo TR team we built these ideas a year ago but were unable to execute them, to now see BT doing these things makes me believe more than ever that they are Orange’s biggest threat now]

Customers of the (fast approaching) Future?

Norman Lewis is up on stage next with his views on Digital Kids with Kennet Radne, head of products and services at Teliasonera and Mitch Lazar, business development, connected life at Yahoo!

Norman starts with the two paths slide followed by the Paris Meteor slide which gets the crowd going, and then moves to the basis of the talk which is all about looking at the development of childhood rather than the development of technology in order to see the customers of the future.

The evasion of the adult gaze, kids don’t want to be looked over all the time, they want to be able to be free in order to experiment

[I know this one, bedroom culture, even at 7 my daughter is doing this already, she disappears with any friend that comes round up to her room and we only see her if she wants some food]

He goes on to talk about how every parent of small kids is amazed by how they just get technology, I know I am, but Norman disagrees with this and cites being able to walk around a house or get around a parent as more amazing

[i think both are amazing myself]

YouTube et al allows kids to play around with identities in a way that they can’t do in the real world, self expression and development, largest active blogging group is teen girls, not about the content, it’s about comments and feedback, identity, reputation, social groups

[I’m not sure Normans swearing is going down so well with this crowd, I’ve seen a few frowns around me but as usual I find it refreshing and it’s mild ffs !]

‘collage culture’ is a good term for the way that kids are mashing up and using this stuff. MySpace is a channel per user, not sure all users are good channels, some are much better than others of course.

as the current generation grows up they will want every service that they use to have some form of social network, they will need this to show off the skills they have gained over the years from using this technology

Hollywood and other major content creators are simply not able to supply enough content for the customers

and now on to Kennet..

A brief intro to the Nordic market, for years now they have had 100% mobile penetration, this year they reached 50% broadband penetration, up to 90% by 2010 etc, it’s also where mobile was invented (Nokia, Ericsson) first ever phone was in a Taxi in 1957 [at least I think he said 57, seems early to me but can’t check while offline], drained the taxi battery in half an hour so things not got much better since then he quips

After two years of analysis they decided to focus the portfolio from around 1000 products to just 50 believing that this will help reduce costs and improve time to market

A quick run through the ‘old school’ telco days and a reminder that we are hitting the inflection point soon, now, very soon?

We have another slide of the new market and the new entrants, the usual suspects are there

[in all of these so far I haven’t seen FON or Wibiki or GardenState, Fring etc]

He mentions PirateBay and the day it was closed down, that day Teliasonera internet traffic dropped by 60% [the site was quickly started up again on servers in Holland in yet another defiant move and continues to run today]

Their view of Telco2.0 starts with understanding digital living for which you need:

  • understanding your customer (I’m sure he enjoyed Norman’s talk)
  • better knowledge of the earnings logic in this new market
  • value based – QoS for MP gaming IS important to ‘kids’
  • flat rate subscriptions – pay per service, per day …
  • revenue sharing – per service or transaction
  • ad based – per transaction, event etc
  • ‘For Free’

We shift to the ‘Focused Service Portfolio’ that they are focusing on now which is built on 4 pillars:

  • content
  • mobile
  • BB/Internet
  • managed services

At the core is system value combinations , he explains as like the old days when you bought wordperfect and other early separate products, but then along came Microsoft with office, so i think he is saying they will do a Microsoft move in not just bundling products together in a xPlay offer but having everything fundamentally integrated at a service level, like the address book, concepts that have been run around FT/Orange for several years now [without any concrete progress to date of course]

three things: always best connected : rich communication services : information & entertainment management
… his talk is cut short as time runs out …

Now Mitch is up on stage and while we wait a question from the crowd is when is Normans book out, and then another one for Norman, “to what extent is his thinking being adopted in the industry” to which Norman gives a good answer which can be summed up as “not much really”

Mitch begins his presentation which starts with a small pitch to the scale and size of Y! whilst agreeing with the previous speakers that they are very focused on the children as they are the future (a quip to Whitney Houston)

A picture of two kids stringing cups together to talk, his kid on screen playing with a screen at 6 months, presumably just because it’s bright and colourful, he is talking about kids version of Tivo that they want to control, slightly at odds to what Norman talked about.

The assertive generation, watch what they want when they want, pull not push

The media industry has been static for 40 years, in the last year more change than at any other time, multitasking (IM while TV etc)

All Y! users are only a click away from leaving, rich slide up with lots of services but with the customer at the centre of course (content, access, right time, right place etc)

they want to move from web only to client based perhaps or TV even

we are at an amazing inflection point –

900 million PCs 2 billion mobiles [reminds me of the Android/Google story]

50% of people accessing the internet outside the US do not do so from a PC now with the trend set to increase

we get a slide on web1.0 vs 2.0 – old vs new again, key point is to mine data better to make pipes smarter [so true, there is so much data that gets ‘wasted’ as in it only gets used to make bills]

nice slide of a walled garden and why they were so good, you can have a key and you can get out, but people fear the charges that may happen if they step outside?

mobile is too fragmented he states, which of course is very very true, something that really needs to be fixed very soon

there are too many barriers put in front of customers, Y! have the connected life platform slide up, one identity to all services (all Y! of course) gives example of phone pictures and being able to sync seamlessly to Flickr or Y! Photos

in order to build new compelling services we must look much harder at what is working now, he puts search as the key service to everything at the epicenter of all other services, can also be extended with the Answers services by getting human answers [kind of like Amazon Mechanical Turk perhaps?]

We break for lunch….

Post lunch questions/feedback:
Is Y! building a virtual walled garden by providing a one stop shop in service terms for their customers, Mitch believes not unsurprisingly, on interop he believes strongly that you can’t just keep your own customers within your own services, the Y! – MSN is a huge leap forward in that direction.

who decides whether services work or are useful – Telco or customer? Kennet makes the obvious statement that it’s the customer, after all who else could it be!?

will mobile advertising work considering the mobile barriers? Kennet thinks it will [evidence from Mobhappy and Skweezer shows that it works already and will only get bigger]

Norman answers a question about how to make money with the kids, to which Norman answers that it is a Telco 1.0 question, then goes on to talk about how we need to look again at how we make money, brings up Scratch and programming on mobile devices and how the customers wont just decide on what is good or bad, they will create it themselves.

Content – Eldorado or Fool’s Gold?

Ole Obermann from Sony BMG

Global music sales show digital growing, already they have 30% from digital in certain markets, most of it on mobile

now we get a slide on the changes in distribution model from physical to digital, new actors and some old ones like mobile but still a growing channel

also the change from 1 or 2 physical items to the multitude of formats for mobile etc

they see their role in the mobile content channel, they get the talent, they exploit the music through the telco to the consumer, they see the telco main strengths as billing, device knowledge and a well established connection to the customer

just launched in the USA Video MusicBox, a player with widgets that any user or fan can embed into their own website, they don’t want the MySpace experience of poor quality non centralised video streaming as they want to provide a better experience [would need to see the actual product to see how this really works]

Alessandro Petazzi, Dir IPTV marketing and content, Fast Web
High ARPU ¢300, high penetration, lots of other stats shown that basically show that those that do use the service use it a lot, i.e. 15 VOD views per video customer per day

They don’t want to be a media company but to offer a superior distribution channel for those that already have that experience, a telling tale for Telcos looking to offer or create their own services I’d say.

PVR and VOD is not killing normal linear TV

Giving away premium content to subsidise broadband adoption is not necessarily a smart move
Their experience is to increase NPV through value extraction and not through giving things away

Unified STB, includes Sky or DTT, theirs is not better than others but simply does it all plus more, they add VOD for example but when they do they choose branded and known offerings like Cartoon Channel

New services like videogames, gambling, PC content on TV for example, they want to move on to offer services like audience data through a test platform which offers a test channel

Just because you have the best Nike shoes doesn’t mean you can beat the 100m world record…. [FT needs to learn from this]

we rush through some upcoming things like Sky HD channels, giving away premium content leads to increased churn at the end of the promotion

VOD is more like DVD rental model (and potential sale) than the traditional TV business
pure revenue sharing is better suited to align the interests of the content providers and distributors
‘best practice: music major’ – not sure I get this line

we close with the statement that there should be no artificial protection of less efficient distribution channels (i.e. windows)

Jose Luis Alonso, dir of content, Telefonica
is on stage to talk about m-channel: ‘a new communication tool and a door to future business’
launched on Motorola phones only 3 months ago, integrated to the handset, 1st in Europe

It’s the homescreen for the device (idle screen) dynamic homepage, portal etc, they liken the level of detail with the analogy of ‘bite’ – ‘snack’ – ‘meal’

it’s a slow death by powerpoint product pitch so far, admittedly not in his native language which is always problematic, something I appreciate fully when trying to talk in French.. however it’s not a new idea, what may be interesting is to see the stats if we get some

Based on a standard called Screen3 running in OMA

Stats show 23% active users with 1.2% premium users

clicks from basic channel 0.75 clicks/active user
clicks to content channel 0.45 clicks/active users
number of channels 5
(active user counted as those that don’t turn the service off)

How to cooperate effectively with Internet players

Gordon Graylish, VP Europe Intel.

Moore’s law – bore
4 major computing cycles over the past 50 years
mainframe -> minicomputer -> PC -> PC internet

the next 2 are the most profound cycles ever..

PC Broadband -> Mobile Internet

It’s a product pitch so far for Centrino, ViiV and vPro, designed to simplify user experience apparently

the next slide is on the Nomadic Platform, all forms of connectivity, stay connected anytime anywhere [except if you are here of course…]

He is claiming that they have solved the problem of the connected home network issues (wep keys, codecs etc) with the ViiV platform

[I haven’t used these products yet so not sure this is true, nothing I’ve read lead me to believe it yet]

He claims we have a revolution on our hands:
service friendly client
access is happening
services universe is expanding exponentially

We move on to Jim Holden, Dir of Global Wireless partnerships at Google with a case study in mobile innovation

3 types of stakeholders:
– users
– advertisers
– partnerships

users at the core is repeated every other sentence, we get a slide on some google mobile products, image search and web search, they want to hook up the PC experience to the mobile experience, something I’ve been pushing for well over a year when asked what Orange can do in a converged search offering..

a slide on partners, Vodafone, Sony Ericsson, T-Mobile, KDDI, Opera etc

next up GMM – an excellent application for which I don’t have a good enough phone to run right now but have used before to great effect

they support KML overlays to show POI relevant to their entry point and show the real time traffic data

next up the Blogger tie in with Sony Ericsson phones, direct upload from camera function

mobile advertising with click to call, early on it looked bad but now claiming ‘nice’ revenue

Gordon is answering a question from the screen and is telling us that it is just too damn hard to do ‘these things’ presently, he is a geek (cough) but his mum is not

The Future’s Bright or ‘Telepocalypse’?

Berit Svendsen, VP and head of Fixed Telenor Nordic

Fixed line industry is in transition, every incumbent has the same plans to handle this transistion, the winners will be the ones that execute it

Scandinavia has almost 50% BB penetration
46% of all calls in Norway are mobile originated (Finland 59%)
25% of all DSL connections in the market are ‘naked DSL’ leading to rapid growth in VoIP market
70% increase traffic per customer
lost 230K fixed customers and only got 73,000 VoIP customers back

3 parts to the plan

  1. acquisition – building an all IP network in Nordics to handle increased traffic
  2. Bought exclusive rights to National Soccer League over mobile, TV and Internet
  3. radically cut costs – cut staff, outsource, phasing out old products, as an incumbent you have legacy to cut, unlike the new players

estimates over the next 10 years they will need 10x current traffic levels so they are building from the ground up a totally new network for all future services (IPTV, VoIP, P2P etc)

the new network is ‘future proof’ with the ability to hook in mobile when it goes all ip,

[not so sure about that but not an access network expert but sounds too good to be true to me..]

Next Up Bill Gajda, chief marketing officer, GSMA

The opening slide claims:
worlds largest ecosystem
mobile at the centre of srive convergence
mobile is the 4th platform
mobile is the bridge for the digital divide

2.5 billion GSM users over the last 13 years and more GSM stats

[I’m finding it hard to be with this guy, he tells us how he has kicked BT out of his flat and replaced with a Vodafone card supplying 800KB/s to three laptops, I assume he doesn’t pay the bill himself for a start and I can’t see how that speed is really any better than DSL to the home for less cost….]

We go through a sales pitch for how great GSMA is, as an operator I’m required to say I agree of course….

Personal Instant Messaging is up on screen, it’s not like current IM, it opens up a global IM community of 2.5BN users, bigger than Yahoo/MSN, sadly I think not again, but may be required to say yes..

Next up mobile advertising, claiming a transformation from Interruption to engagement, I can’t agree again however the analysts are saying there will be $11.35BN revenue in 2011, so it must be big right?

Emerging market opportunity
– 10% inc in mobile penetration creates a 0.6% increase in GDP
– 3G4ALL to drive handset costs down

Next up Ken Ducatel, Cabinet member from the EC has the tough job of delivering the last presentation of the day, the twist is that he has no slides!

He wants to talk about some European regulation rules for communication, he wants to talk about establishing a new set of rules for governing IP based communications, if they get a proposal in next year it may make it through the EC by 2009 and maybe laws being introduced in 2012-2015


  1. spectrum – feels there is a good case for streamlining spectrum allocation, spectrum trading on select bands, pan european allocation, decision making is too slow so create a European level agency to do things quicker, a market worth ¢200BN a year
  2. how well are we doing on the internal market (or the 26 national markets as it is really) – more consistency proposed, commission Veto as it’s inappropriately termed, trying to ensure a level playing field when it comes to regulation
  3. competition and investment – structural separation? they are interested in looking at it [whatever it is] driven by three disruptive things

As we move to an all IP network is there a logical split between the network and the services provided on them? it seems that this guy thinks that in the interests of European citizens that there is a requirement to split them. Could it go so far as seperate stock value items for network and service provision.

Although a very dry and no ppt style presentation the topic is a very alarming one for Orange, and indeed for any other Telco ?!

We close with a vote on your level of confidence in the future being bright for a telco in an all IP world, the results are:

Very confident 1
Confident 11
Not sure 14
Not confident 24
Very unconfident 15

[although a simple experiment at our table showed that the vote could be rigged, I submitted at least 10 votes at our table…..make that another 15 and the chart changes on screen…the problem now is that the panel is being asked to comment on very skewed result set]

Svendsen sees that the mobile operators can have a bright future as opposed to the fixed line business
GSMA keeps a 10,00 foot view and they are pretty confident in the future of mobile at least
EC its obvously a sector in transition, until business models start to emerge then the feeling of uncertainty will remain
Resident Analyst – not surprised by the (skewed) result set as seen it before

[was someone messing with the results there too? to be fair the most voted for would be not confident or possibly not sure without tampering]

EC – in a heavily competitive area tell the regulator to back off and let them sort it out themselves, out in rural areas there is more call for regulation to protect the customers, they would like to move away from retail regulation to purely wholesale

GSMA answers a roaming question that boils down to ‘the market is working well within the community we represent’

That’s the end of Day 1….well except for the networking cocktail drinks about to take place

Day Two

Voice & Messaging : Threats and Opportunities

Martin Geddes – Two Questions
What’s the unmet use need?
Where’s the money?

Claims a better product should allow you to take a picture during a call and the other party sees it

We move on to how SMS lacks emotion and is difficult to learn etc etc, [makes no mention of the billions of SMS we already deliver though], claims we should create voice messaging, [I remember that we had Voice SMS in Boston well over a year ago but never launched it]

We are shown a web graph of mobile vs Skype vs PSTN and a run through of how great Skype is as it shows who is talking in a conference call for example, from his blog I know he is a big fan and their company uses it heavily

We move on to the Money part, Martin believes the growth areas are in B2C, C2B and also a point I totally agree with in that CDRs are digital exhaust and just lost, [this is the basis for Personomii of course so I would agree]. He supports this view with the fact that the money stops when the call is completed which is when more money can be made if only this was recognised.

The screen shows the telco comparative advantages such as strong identity management, cash collection & revenue management, billing and tax management, inventory management, retail presense.

Don’t compete with the internet players – build things that leverage the strength, now we have a large skull and crossbones on the screen whose eye sockets are the Skype logo and the news that disintermediation is happening and will get worse, like QQ for example, Habbo, Cyworld, WoW etc, in these services there is a very strong community that simply wont break up to go to a telco offering

Operators are losing control and now they see that the users are in control, hmm, this is a clear trend, SIM free handset sales for example

we close with a slide telling us that we should be selling stuff on the phone screen, dedicated buttons, animate calls with socail features, enable communities in the contact book etc etc

the final thought is that the fuel for the industry is termination fees, why can’t I use my mobile number as my Skype in number for example.

Tomi Ahonen introduces himself, 3G book author service concept expert etc, I met him some time ago at Nokia when I gave a talk. We run through the session feedback.

Telco makes money with the network and not because of the network, BA makes money because they run flights (retail opportunities for example)

the effort of producing communication should be as low as possible and the effort of understanding the context of communication should be as low as possible.

Tomi says that the mobile phone is replacing cigarette smoking from the last 20 years, the device is self expression etc and how they need to be validated within a peer group, he also cites the Cyworld phenomena as you might expect.

How to develop effective strategies for voice and messaging revenue growth

Matteo Gatta, group strategy director for Belgacom.

He runs through a series of slides highlighting the 1.0 vs 2.0 strengths and where the foucs should be, keep it simple, bundle it’s all stuff we’ve heard and talked about before, however one key statement he makes rings very true “embed voice as an application into web services”

We close with some burning questions:
In an increasingly crowded market with little differentiation on basic products:
how can you raise above?
how can you make you’re voice heard?

It’s very interesting to see a PTT re-invent itself as a go to market platform for their own and other peoples services (rather than waste money trying to create their own)

We move on to David King, CTO of Logica CMG who opens with a quick recap on 2006 convergence news forecast which covers things like voice becoming free, BB becoming free as advertising takes hold (not sure that’s why myself), 3G flat rate plans emerge (very bad news) cameraphones aren’t saving the day

then we move to a point about how the companies that talk to and embrace ip service companies may well be the one that wins, [well he didn’t state this but it’s my view and I think its his view]

we get some slides on the opportunity with pie graphs etc and how the pie gets bigger as ip and data grow in mobile music sales for example, the worry, the danger is that GYMAA are going to come and take much of the pie

Advertising comes up again, how it accounts for 45% of TV revenue and it will happen on the mobile, they just don’t get it, he is telling us how ads are not intrusive in a newspaper so it will happen on the mobile, I simply don’t agree. There has been so much talk about listening to what the user wants and I really don’t believe the users want ads on their mobile, no matter how unobstrusive they are.

Now we’re told that what the telco need to do is:
– launch new services rapidly and often
– increase awareness and use of new services
– increase ARPU
– reduce churn

Another new service is not enough – a new approach is needed

The coffee experience can be likened to the consumer centric view, as the experience gets better then you can charge more for a decent coffee…. overlaid now with three things to do again:
maximise quality
enhance their understanding of their customers
improve their customer experience and their brand

LogicaCMG intuitive messaging? for example you can’t set an out of office for SMS, they want to add external services to SMS, I think in many cases this would simply be an intrusion again.

The panel session is pretty uninspiring, at one point Tomi tells us the Crazy Frog story and how ‘crazy’ it is that someone will pay more for a ringtone than a full quality version of the song, this has been covered ad nauseam for a long time now.

The next question is whether MMS is a flop, again uninspiring, complexity, cost etc etc Tomi tells us all (several times and each time with a bigger smile) to blame him as he was responsible, they did a huge study which assumed that since people attached files to email then they would do the same for SMS and therefore make MMS relevant.

Most SMS traffic is not relevant to MMS usage so a lot of it will not transfer, however new services are making use of it, Flickr and Cyworld etc

[Once again in the questions “why can’t operators just offer fixed price plan including data…..”]

The last session before lunch is from three disruptors to the telco environment.

First up is Telio, founded 2003, leading European access independant ITSP, biggest VoIP provider in Norway serving over 100,000 subs carrying 1.2Bn minutes this year.

what did they do different to get where they are now?

started with access independant platform, internet telephony regardless of access method, similar to Vonage in the USA

create unique attractive offerings, plug and play devices with no setup.

offer more for less

1st Myth is that you can’t do access independant VoIP due to QoS and NAT traversal, they believe to have proved this worng, according to a survey of quality the access providers own VoIP scored lower than Telio, of course since Telio is independant they can address 100% of the BB market

2nd Myth is that you can’t make money, however Telio have been cash positive since 2004 and growing year on year still

of course they can keep costs down as they don’t have to build or maintain the access network..

in the future looking to ad wireless, GSM and ultimately as a full MVNO with their own switch

flat rate is put up on screen again, operators are warned that ‘shift happens’

over the next few years revenue will be mainly from arbitrage of voice and past that we will start to see converged real time communications services

Next Up is David Beckemeyer from PhoneGnome, the tagline is ‘unbundling at the edge’

the very interesting part of the offer is that it offers a platform to 3rd parties so that they can be insinuated into a traditional telco line

It can do most of what IMS promises – today – at orders of magnitude less cost

they want B2B business too as the tech can be made into anything you want, I’m wondering if it would be useful in a Livebox?

Next Up is Maggie Warbrick CEO of PacketMobile with a session called (by Martin Geddes) Mobile VoIP – dream or nightmare?

a recap of MySpace……

we’re building up to LTP (lightweight telephony protocol) which allows then to do things like:
– IM
– Rich presence

LTP will be open sourced at the end of the year when trademark comes through, works on any phone with mobile data, not reliant on WiFi as works with any existing access protocol


windows mobile
symbian OS
java midlet (IM & Presence) but no talk

they also offer an HTML widget to allow click to call from any web page

the client is only 90kB, built on LAMP, inbuilt NAT traversal, low power requirements

Benefits to the operator
– revenue
– churn buster ‘sticky’
– java midlet as a tantalizer
– low / no capex
– growth strategy
– satisfy customer demand
– doesn’t require IMS or even SIP

the close out session focus’s on whether the three companies are aiming for niche or mass market and whether they have plans for MVNO?

PacketMobile and PhoneGnome = B2B and No
Telio = mass market and yes they have plans to be an MVNO

Afternoon session starts off with the results of the pre-lunch survey prepared by Logica read out by Martin Geddes with comments from Tomi.

The results all stack up with the answers Norman and I picked (IM needs to be interoperable between mobile and internet effectively)

Tomi wants us all to join a free group to discuss the future of mobile communications enrolment key is forumoxford, he also wants to get us to his blog

Apparently the quality of our questions have scared off the guy from BT who has failed to show.

Fredrik Backner, Director of messaging at TeliaSonera, we open with a summary of his company, the same slide pretty much as Kennet Radne gave in his speech, same company after all..

Fredrik runs through the reasons why an operator needs mobile IM, all of which is pretty clear and then runs through the options
– 3rd party with MSN, AIM, Y!
– operator centric (personal IM)
– combination
– do nothing

We’re told not to allow anything other than text based IM to GYMAA providers otherwise we sidestep our entire business and become a bit pipe again.

TS are doing personal IM with another operator in Nordic countries and studies on user behaviour, we close with some suggestions to operators:
– seriously consider GSMA Personal IM (make sure the PC can access people on Personal IM)
– understand opportunities & threats of fixed IM providers

The day ends early for me due to being very ill all day to this is the end of my verbose notes, I’ll write up a more concise report later as this has reached several pages now, Ian Pringle and I were asked by Jason, one of the organisers, what we thought of it overall, 7 out of 10 we thought, the Voice and Messaging session was the weakest part, made more so by the fact the main reason for going (BT) failed to materialise.


1 comment so far

  1. […] The problem is that we might, in part, be wrong. There are contrary opinions from both business and social perspectives. Networking has always been an important aspect of business and Alain Lefebvre’s book les réseaux sociaux makes a strong case for professional social networks. As the founder of 6nergies, his knowledge is based on substantial practical experience. Alain has a clear style of writing, so his book is accessible to anyone with a moderate grasp of French. The Financial Times Magazine (October 27th) had an article by Graham Bowley titled “The high priestess of internet friendship”. It reported an interview with Danah Boyd. Much of what was said about kids and networking wasn’t entirely new to me – Calico Jack has been working with Ian Pringle, a member of Norman Lewis’s group at Orange. Norman would certainly eschew the title of high priest (I’ve no idea how Danah views the corresponding epithet). Apart from anything else the role rather rules out meaningful debate. Norman is nevertheless an acknowledged expert on the subject – Ikasai’s notes from the same event provide a slightly different perspective. What did strike me though from the interview with Danah Boyd was the observation that many people are using social networking software to reinforce existing relations rather than to make new ones. Perhaps we’re innately clubby after all. Marshall Kirkpatrick’s TechCrunch interview with SixApart’s Andrew Anker highlighted the twin issues of privacy and control. The title of Marshall’s piece “There is still room for more and better social networking” probably sums up the message here too. I’m convinced that the next generation of social networking applications will find ways of straddling the open and closed views. But to do this they will need new technical approaches capable of rapid adaption to both changing social trends and individual concerns. Chris’s recent post on mass customization gives some idea on how Calico Jack is approaching the problem (look towards the end). In the meantime I’m remaining in the open network camp. I can’t quite bring myself to rescue my orphaned LinkedIn profile – though 6nergies might be more fun. […]

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