Getting your out-of-contract or fully paid smartphone unlocked should be less of a hassle if the FCC has any say. And it does. It’s working with carriers to ease the process and actively telling consumers when their contract is up.
This month, Netflix began offering streaming 3D content for the first time, along with something it calls “Super HD” video, which is says is superior to “full 1080p” video. The catch is that Netflix claims it can only deliver the new services to subscribers’ whose ISPs have configured their network to interoperate with Netflix’s own CDN due to the high bandwidth requirements of 3D and Super HD.
U.S. carriers like working out exclusive handset deals with hardware makers – such as the Lumia 920 with AT&T — but who benefits? Consumers really don’t, hardware makers might, but it’s the network operators that benefit most. Here I thought competition in the U.S. was good!
A data plan to charge consumers extra for Skype, Google Talk or other VoIP calls has been squashed by TeliaSonera; sort of. Instead of the planned 6 Euro fee for 5 to 10 hours of VoIP calls, the operator is simply raising rates for all.
Today’s must-read comes from Fierce Wireless’s Lynette Luna, who examines how carriers are beginning to embrace Wi-Fi as a way to deliver data while minimizing traffic on their networks. Network operators are looking for Wi-Fi solutions that provide the kind of visibility and management functionality as their 3G and 4G networks, Luna writes, and vendors are scrambling to come up with those offerings. So while Wi-Fi is a simple way to offload traffic, it is still inferior to traditional cellular networks from the operators’ point of view.
The addition of Charlotte; Indianapolis; Kansas City; Las Vegas; Oklahoma City and San Juan, Puerto Rico bring AT&T’s LTE city count to 15 — meeting its 2011 target. But feeling pressure from Verizon’s ever-growing competing network, AT&T may opt to overshoot its goal.
Carriers who fear devolving into dumb pipes have pinned their hopes on becoming “smart enablers,” leveraging assets such as network data and billing systems to keep pace with other players in the value chain. But for that to happen, operators will need to attract the attention of the developers of apps that can capitalize on those assets. That’s the takeaway from a new report from the market research firm Ovum, which warns that the concept is inaccurately being hyped as a panacea for network operators.
The move from dumb pipe to smart enabler “involves profound change” in the way carriers do business, the UK-based outfit warned last week, suggesting some carriers — particularly those who don’t play well with others in the industry — probably won’t successfully transform from simple voice- and data-delivery providers to “network as a service” (NaaS) companies.
A mobile smart-enabler model comprises a dozen or so possible components, including:
- Customer analytics (such as mobile data traffic and usage patterns) that can be used to deliver targeted ads
- Payment mechanisms and customer billing relationships that are easily leveraged by third-party vendors
- Location information for developers and location-based marketers
- Network and device APIs (application programming interfaces)
- User interface, which allows carriers and their partners to present their brands to subscribers
- Directory services that can connect callers without divulging actual phone numbers
Operators have already begun to leverage – and monetize – some of these assets, of course. Carriers have long used their power as billing companies to claim a stake of content sales, for instance, and Sprint and Verizon, among others, have begun to share subscriber location information with a few select partners (via platforms built on web-service APIs) who then pass the anonymized data on to third-party app developers.
The concept of smart pipes isn’t a new idea: In 2007, Juniper Research predicted carriers around the world will generate $58 billion in non-messaging mobile content revenue by 2012 by employing “a smart pipe strategy,” up substantially from the $44.7 billion the research firm predicted in a “dumb pipe scenario.” But the industry has changed substantially in the last two years, and developers have taken their rightful place among the most important players in the industry. Their powerful position will only be further strengthened, I think, as the smart enabler movement grows legs.
Carriers can monetize their role as smart enablers by helping their partners build better apps and deliver more targeted ads. An operator could command higher revenue splits from developers, for instance, for apps that use location information in a compelling way, or that can be marketed virally by connecting subscribers on the same network. But the industry will need to build consistent business models for opening network APIs, as Ovum points out, finding the right combination of features to minimize costs (such as developer fees) and maximize revenues. And operators should lower the bar to entry and share the risk by eliminating API access charges until minimum revenue thresholds are met.
Carriers face plenty of other hurdles in the race to become smart enablers, too. They have yet to figure out how to fully share (and monetize) subscriber information with advertisers without drawing the ire of their customers; margins from messaging apps are sometimes woefully thin; and revenue leakage for third-party applications remains a problem. But solving all those problems won’t matter if carriers can’t draw the attention of creative, innovative app developers with better tools, thriving communities and more attractive business models for all links in the value chain.