Mobile operators missing a trick with customer data

Mobile operators need to integrate themselves into the content delivery value chain

Mobile operators need to make effective use of the close relationship they have with customers if they are to integrate into the value chain created by the growing adoption of mobile content and services, according to Juniper Networks.

The introduction of flat-rate mobile data plans, and the propagation of 3G networks, has spurred the rapid uptake of mobile internet access and a host of new services. However, while the operators are having to upgrade and overhaul their networks to deal with the growing deluge of traffic, they are not seeing much additional income from the changing trend in mobile usage.

"The existing business model is broken, people are consuming more and more content while the operators are sitting in the middle and are currently being bypassed," said Gert-Jan Schenk, senior vice president of operations in EMEA for Juniper Networks. "They can play a valuable role in the delivery and not just be dumb pipes."

Schenk pointed out that, as connectivity becomes increasingly ubiquitous, there is a growing expectation, both personally and professionally, for instant information and answers.

"If you look at the type of things that need to be approved in an organisation - it could be hiring contracts, special pricing or whatever - in the past people were willing to wait a couple of days because something needed to be sent by post," he said. "But nowadays people sign off an email and they almost expect an answer within a minute. It's because you know it's possible, so the former becomes unacceptable."

It is this paradigm that the service providers are battling to get their heads around. Whatever people are doing with their connections, whether in the office or at home, operators have to meet that demand, and must work with content providers to meet the expectations.

Schenk identified two distinct sides to this issue. One is the content providers that have a standard model of cost per bit, selling their services or content for a fee, and the other side is the operators that need to realise the value per bit on the network and what kind of services businesses can introduce that customers are willing to pay for.

"This harks back to the days of early broadband access, where the connection fee was seen as a premium on top of the existing subscription, but the world has changed," said Schenk.

"This is where the network providers have to develop the value per bit, i.e. having quality of service. The network provider can then promise a quality experience that is worth money to some users."

Operators have the option of starting to offer their own services and content, already done by some in varying degrees through portals. But Schenk warned that this could quickly start falling into the net-neutrality trap, whereby they may start giving preferential network treatment to their own products and throttling access to others.

Schenk believes the key lies in the close relationship people have with their mobile phones and, by extension, with the operators. These include real-time location and presence information, as well as long-term trending details based on personal information, call patterns, surfing habits and so on.

He concluded that it is important to make sure that the correct balance is maintained between privacy, and the ability to offer ever more customised and relevant information to users.

By maintaining transparency, and possibly offering rewards for opting into these schemes, Schenk reckons that users can see the benefits of relevant and timely information, while operators can start to integrate themselves into the content delivery value chain.