LAST WORD


END-TO-END GAMES MOBILE WOR LD CONGR ESS REVIEW


This year’s Mobile World Congress saw operators going back to their network strengths to find a place in the new value chain among over-the-top providers. By Nick Wood


growth potential of new industry verti- cals and the opportunity to enable new and exciting services, but was the upbeat delivery of numerous keynote presenta- tions and press conferences simply putting a positive spin on adjusting to life further down the value chain? “One of the enduring issues for opera- is addressing the gap


O tors between


revenue and the costs related to the network,” said Capgemini’s global sector leader of telecoms, media and entertain- ment division, Greg Jacobsen, who spoke with Total Telecom on the sidelines of MWC. This year operators are “looking into any service that generates additional data traffic” to fill that gap. “Two years ago the solution seemed to


be content...Last year it was going to be apps,” he continued. “Content was not the silver bullet and now operators are realising that apps won’t be either.” Indeed, at MWC 2011 operators seemed


to acknowledge that no single area is going to be the answer to all their prayers. Instead they are spreading the risk by evangelising the potential revenues from connecting different industries to their networks, and participating as much as possible in the raft of existing and upcom- ing over-the-top (OTT) services. “I’ve seen plenty of talk around m2m,


m-health, automotive, industrial and smart energy services,” added Jacobsen. To embody their need to embrace


different sectors and services, operators fell back heavily on the word “openness” and all that the term encompasses. During Tuesday’s first keynote, the chief execu- tives of some of the world’s biggest mobile operators—including China Mobile, Vodafone, AT&T and Telecom Italia— talked of the need for open systems rather than so-called walled gardens. “Customers are going to do what they want,” suggested AT&T CEO Randall


March 2011 www.totaltele.com


perators attending Mobile World Congress 2011 may have talked with enthusiasm about the


Stephenson, who called on operators to facilitate “open environments”. Walled gardens “were not successful”,


added Franco Bernabe, CEO of Telecom Italia. “An open system is what is needed.” Even people with short-term memories


will remember that fewer than five years ago it was operators that came in for criti- cism for insisting on these walled gardens. But now that OTT players like Google and Apple are hogging the limelight—and in the case of content and application stores much of the revenue to be generated— they are falling back on their strengths. “The intelligence residing in the network needs to be leveraged,” said Ryuji Yamada, CEO of Japan’s NTT DoCoMo. A prime example of this drive towards


greater openness was the Wholesale Applications Community (WAC), which as well as unveiling its new WAC 2.0 app standard shared its plans for WAC 3.0, which among other things will make use of operators’ network APIs to enable in-app billing. DoCoMo’s Yamada warned that “oper-


ators are susceptible more than ever to being reduced to a dumb pipe by the


Unlike their OTT rivals, operators are capable of managing their network end- to-end, ensuring guaranteed quality of service, Suri said, which leaves the door open for potentially lucrative partner- ships with content providers. Meanwhile handset vendors, which rely


on operators for marketing their latest and greatest devices, but also drive sales by acting as a gateway to the most coveted OTT services, sat somewhere in the middle at the show. RIM co-CEO Jim Balsillie, and Nokia chief executive Stephen Elop, in particular were keen to distance themselves from Android and Apple, and talked up “constructive align- ment” with operators. “You get the sense with these over-the-top players like [Apple’s] iOS and Android that the profits and the points of control are going away from operators,” said Elop. Nokia hopes to tap into some of those profits by align- ing itself with Microsoft and its Windows Phone 7 operating system (see p.4) Yankee Group vice president Declan


Lonergan says it is a case of operators choosing how to align themselves with over-the-top services in a way that offers


‘Content was not the silver bullet and now operators are realising apps won’t be either’


global emergence of smartphones and over-the-top services”, but on the posi- tive side added that “operators are in the best position to know what the network is capable of.” His conclusion: “It is a race between these two different camps.” According to one European vendor,


that race is already over. “Competing head-to-head [with Google] is a fool’s errand,” said Rajeev Suri, CEO of Nokia Siemens Networks, during a press brief- ing. “No-one is going to out-Google Google.” He advised operators to re-engage with their customers by making greater use of their stored infor- mation and tailoring their offerings.


the most benefit. In his post-Barcelona report he insists that MNOs still main- tain a vital role in the mobile ecosystem, but


that they need to “identify which


OTT content and providers are comple- mentary to their own services and which ones will benefit from integration with the MNOs’ network or app stores”. This will open up new opportunities for oper- ators to add further value to the user experience, he says. However, he concludes with a word of


warning. Lonergan says at MWC 2011 there was “plenty of evidence of how other players in the mobile ecosystem can take a piece of the MNOs’ action”. n


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