Thursday, July 09, 2009

Innovation for telecom operators (service store)

I was discussing with a friend about possibilities for mobile operators. (apart from being bit pipes do they really have a case for doing something else in future)

There were main points which we thought a mobile operator is different.

1. For users to experience a service through a mobile, operator can get a lot of first hand data and a better sense to customize and improve the service.

2. Paying for a flat Internet connection like 15 Euros per month in Finland and similar amount elsewhere. Is there still some latent demand which might be satisfied if the price to be paid was less.

As the discussion progressed I came to the conclusion that a new type of business model is possible for mobile operators. which is somewhere in middle of Flat rate and Pre-Paid (or pay as you use)

The proposal is to charge user per service. Say, you are an avid facebook user, the mobile operator will provide you a widget or some other access point in your mobile by which you can access facebook unlimited! (The price is definitely lower then flat rate and pre-paid)

So, as a user if you are not an explorer on Internet and consumer of 2-3 standard Internet services. You might go with this kind of an offer, where an operator can charge you something like: 2 Euros per month for facebook and 3 Euros per month for Youtube (maybe higher because of video content). So, if you are only doing facebook and youtube. You end up paying just 7 euros per month.

From the operator vision, they can create a service store from where people can buy such service pakage for 1-3 Euro each (price depends on the market, this is say as per scandinavia). Like the developer community on other platforms (iPhone, Facebook) , here we have the third parties (Google, Yahoo or a freelancer etc) who can provide there customized widgets on mobile operators service store. There can be a revenue sharing between third party and mobile operator.

Also, Operator can build a colloborative filtering support in the platform and provide standard API's to the service developers and provide users of the service a unique experience customized as per their local network.

This business model would be an equivalent of micro payments in other platforms. Where you (as a user) can buy less demanding services for unlimited use at a much cheaper price. (say even 10 cents, which might be just a weather update from Internet )

It is also combining the bandwidth cost and application cost in one package. (Like amazon kindle where you don't pay for the bandwidth , most customers don't even realize that)

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