In some cases, operators have sought to re-word the meaning of unlimited. AT&T has — according to the post — decided to start limiting the unlimited usage of it’s top 5% of problem customers (that is, folk who have the temerity to actually use their phone’s data connection). AT&T has apparently throttled offending connections to the point that once folk have used up their “unlimited” 2.3 gigs of data, their connection becomes virtually unusable. Or really, REALLY slow.

Did you see what they did there? Aye. It’s still an unlimited connection. Just, the speed is rubbish. So you can’t sue! You are still getting unlimited access. It’s your own fault if you can’t be bothered to wait 2 minutes for a page to load. How is this possible?

Well, nobody ever signed up for a specific speed, did they? Most customers were simply sold an “unlimited data” connection because the operator didn’t have a flying fracking clue what is was doing in the first place — despite the fact they’re selling a resource that is, by its very nature, limited.

It’s the equivalent to me selling you unlimited access to my swimming pool. You assume that this buys you access to the whole pool. You might be a little bit annoyed if I rope off a swimming lane and assign that to you. But you’d probably put up with it. If I let you use the whole pool for the first twenty minutes of your swim and then restricted you to 3 square metres of water space, you’d probably go nuts. I’d happily point out that you still have unlimited access to the pool. You can use that 3 square metres ANY time you want.

Yeah. Ridiculous.

What would be even more crazy is if I started encouraging you to use my pool for twenty minutes then get out and go to the gym opposite. You’d be responsible for paying for the joining fee and the monthly maintenance.

Does that illustration sound a little bit off-the-wall? Well, it’s more or less what AT&T is doing…

Here’s one example from the AP piece. A consumer was sent this message:

ATT Free Msg: Your data use this month places you in the top 5% of users. Use Wi-Fi to help avoid reduced speeds. Visit www.att.com/dataplans or call 8663447584.

I’m really surprised to see this kind of ‘warning-marketing’. How rubbish does your infrastructure need to be when you start telling your customers to STOP using your facilities and to start using an alternative?

I really do have to breath deeply when I see this kind of behaviour in the mobile industry.

However — and it’s a big however — it’s distorted the market completely and made the business of competition a little bit more challenging. When most operators have at least 50% of their customers locked away on multi-year contracts, the incentive to do anything resembling innovation is limited. Yes, when there’s a bit of pain at the end of the contract when you have to give a few hundred extra minutes to a bleeting customer to avoid them churning, but that’s nothing when compared to actually having to get off your arse and run a successful change programme.

So should the UK do ‘a Chile’? They’ve mandated that every handset sold must now be unlocked so it can be used on any carrier.

This removes one of the primary retention strategies for contract customers. That could only be good for the market, surely?

What do you think?

The Republic of Chile has announced that all cellphones sold within the country starting last Monday, January 2nd, must be unlocked for use on any carrier.

via All cellphones in Chile must be sold unlocked from January 2nd | The Verge.

It’s the first new year’s eve since the launch of iMessage. Will Apple’s servers hold up? Can they teach the MNOs a thing or two about scaling? History suggests not but I guess we’ll find out!

Jay responded:

That would be a no! It’s midnight here in Hong Kong, and trying to send *any text* with iMessage enabled results in “Message send failure” – turning off iMessage, and the mobile operator handles it just fine.

So I guess even just the lookup of “is this an iMessage person” was failing… ouch!

My son was due out of bed at about 530am (teething at the moment) so I didn’t bother doing the whole New Year thing. I was in bed by 10pm I think. Life as a father with a toddler, eh? So I didn’t get to see if iMessage performed nicely during the midnight rush. How did you find things? It raises interesting questions about Apple’s ability to truly scale to significant volume. One imagines that Hong Kong wasn’t doing THAT many iMessages, surely?

I’ve procrastinated enough. Now I need to actually do something about it. It’s time I owned an iPhone 4S instead of playing with test devices.

I have accounts on all the UK networks: Everything Everywhere, Three, Vodafone and o2. All of them are either eligible for upgrade or I can add a second line. I’ve got the budget to blow on a new device. I am ready to contract.

So I thought I’d use this opportunity to do a test of the UK mobile operator social selling apparatus.

I tweeted the following message and prepared for the deluge of responses:

Operators, I’m about to buy an iPhone 4S today. The custom could be yours. Just tweet me!

I was expecting to get a qualifying tweet within 5 minutes from one of the operators — you know, something to check that I’m not joking and to determine that I do wish to be engaged with a view to fulfilling a transaction.

I was then expecting for the conversation to a direct message and for the operator to explain that “Sarah” (i.e. some named individual) would like to give me a call to discuss.

Do remember that if I had initiated a phone call with any of the above operator sales lines, I’d have been able to do the deal within about 5 minutes or less. Remember I’m also an existing customer of each network so there’s no crazy extensive credit check — indeed, most of the operators (Vodafone for example) would be able to put any upfront costs on to next month’s bill, making the transaction very simple. I also knew precisely what I wanted to buy.

I’m also aware that as a mobile choppy, known to most operator PR teams, the chances are I’d get a skewed result. I wondered if some eagle-eyed observers would have spotted by tweet and have called their social teams to make sure my tweet got actioned.

I followed up my first Tweet with this one:

Meanwhile I’m writing a post about my intent to buy an iPhone today with o2 — at their store, as I’m assuming no operators will reach out

(You can find that post here)

So here are the results in no particular order:

T-Mobile: I heard absolutely nothing from them
Orange: Absolutely nothing
Vodafone: Nothing! [Come on Vodafone! What happened?? I have *FOUR* lines eligible for upgrade with you!]
Three: There was some interaction with their social team
o2: They did reach out!

Deary me.

I really did expect an overwhelming deluge.

I thought operators were really hot on social CRM! I really did. Of course, I expect if I’d actually engaged an account like @vodafoneukdeals (their Twitter profile for their online shop) I might have got somewhere.

I assumed that all the operators would have some kind of special monitoring in place, ready to pluck out messages like mine and stick them through the sales funnel.

Theoretically all I needed was for one of the social media teams to get someone from the sales team to phone me. The @ThreeUK social media team did volunteer to arrange a call. That’s probably the best response I had. They used the phrase “can we arrange a call?” which I interpreted as, “Can we have a chap from India call you.”

I replied back saying it was ok — and that I’d call 333 myself. I probably will. I just am not in the mood for the highly functional Indian call centres at the moment. I didn’t really want to give my life story to them either. If, however, ThreeUK had said “Sarah” or “Paul” or “Jeff” was going to call me, then I’d have probably reacted differently. Just, you see, I’ll probably be doing an upgrade with my Three account — and it’ll be an early upgrade, so there’s usually a bit of cash involved. I don’t mind that. However the last time I tried to do this, the Indian chap I spoke with was horrified at the £200 I’d need to pay. “Yeah, that’s fine,” I said. He tried to convince me to wait 6 months so he wouldn’t have to charge me that. He was well meaning. Very well meaning. But all I wanted was the handset and I was happy to pay. So I didn’t want another re-run of this.

But at least there was some interaction from Three.

o2 were pretty good too. I had a good dialogue with them across the afternoon. They didn’t offer to sell me a device (i.e. just get it done by phone/tweet/email or whatever). Instead they supported the process with me — because I had already indicated I intended buying a lease iPhone. I think that’s totally acceptable.

You’d think though, wouldn’t you, that operators would by now have some kind of system in place that tracks what *I* say in the context of spending money on telecommunications stuff. It’s all very well being able to interact with consumers by social media, but how about actually selling them stuff?

On the basis of around £250/month spend, I’m worth £3,000 a year to Vodafone. If you assume Vodafone UK company does about £5 billion-ish a year, I contribute 0.00006% of their revenues.

Not that much, I suppose. But a few of those start to add up.

Is there no “quick, Ewan wants to buy something” register that pops up and alerts the sales people sitting on their hands at the call centre? Or is the market on the social media channels that small that it’s really not worth bothering about? That could certainly be the case.

I’m sure I saw a rather nifty system from Amdocs at this year’s InTouch event that helped track and manage this kind of social customer interaction. I must ask them about it.

Meanwhile, what’s your reaction?

Was I expecting just a little bit too much? I’m sure the operator sales teams reading this would have rather they’d made the sale than ignored it. Did I do it the wrong way? Or perhaps I should have been more blatant? Maybe I should have addressed each operator directly with my sales intent, rather than have them come back to me?

Anyway, do let me know what you think. My next post will discuss my o2 in shop experience.

I still don’t have an iPhone 4S.

Well, reader Dmitri decided to take up the offer. I think it’s pretty accurate to say that his expectations were set to rock bottom when he phoned up initially as the Orange person didn’t seem to know much about the service. However all was not lost:

Today (a day-and-a-bit-later) I get a call from a knowledgeable person who asked me what prefix I want. Five minutes later she calls back and confirms the line is working – I am pleased with the number they picked for me. I promptly received an SMS and an e-mail with the summary of everything and later on I’m going to set up the service and see how it really works!

This is good news.

One point that Dmitri makes is that, unfortunately, he can’t call out from that number:

I just discovered a slight disadvantage to this feature. If, say, I want to call somebody, they’ll be seeing my mobile caller ID and not the pocket landline caller ID.

Still.. it’s good to see positive feedback about an operator service!

There’s a whole community of stakeholders. Thankfully, someone’s put a steak in the ground and said, let’s fix it. Or, at least, let’s discuss it, let’s look at some ways ahead and see what can be done to make things better for everyone.

This story at Exhibition News outlines what’s going on. If you’re a vendor or operator, I strongly recommend getting in touch with the organisers. If you need an introduction, drop me a note — I’ve been doing a bit of work with the team at Reed Exhibitions.

The meeting of 28 delegates at Reed Exhibitions’ offices in Richmond follows discussions on LinkedIn that led to a meeting at the Event and Exhibiting Show in July and now a working group exploring how to improve Wi-Fi connectivity on the show floor.

“This began as a discussion on Reeds Ops LinkedIn Group and seems to have struck a chord with all parties within theindustry,” Reed Exhibitions operations director Piers Kelly said. “Technology will become an increasingly important part of exhibitions and we need to have reliable, available and cost-effective solutions to providing Wi-Fi irrespective of size of event or location.”

Just in case you think it’s a non-issue, consider this rather delicious fact from a related Exhibition News post:

According to Max Wi-Fi, the wireless provider for the recent London Art Frieze Fair, attendees transferred nearly 1TB of data during the four-day event.

(85% of devices connected during the event were iPhones and iPads!)

Just to let you know, you’ve used over 3MB of data which has cost you £3 per MB so far. Once you use more than 5MB in a day, the charge becomes £15 inc VAT for each 5MB.

I’ve written about this before. I don’t know why Vodafone make these messages so cryptic.

Shouldn’t the message read, “You’ve used £9?”

No. Of course not. That’s quite expensive. Much better to ease the customer into a false sense of security — to try and avoid too much bill shock. Indeed, the more confusion and the lower the perception of costs, the better.

It’s ridiculous. It’s not just an issue confined to Vodafone — Three, for example, is a lot more direct about the costs in their text updates. The fundamental issue is that the rates are still far too high — Vodafone’s team are obviously aware of this or they wouldn’t have felt the need to disguise and divert attention from them.

It’s a sad state of affairs, it really is. I decided to record a video — for posterity’s sake — of how I was feeling about it. I’m intending to be able to look back at this in years (5? 10?) to come when this is no longer an issue. I wonder what the marketplace will look like at that point. What will the phrase ‘carrier’ or ‘operator’ or ‘roaming’ mean in 5 years time? Or 10 years? It is realistically going to need a decade before I can stride between geographies without having to care too much about the resulting data costs?

If you’ve got 10 minutes and you’re in the mood for an outpouring of emotional geekish disbelief, click on and tell me what you think.

What’s your view: Will the roaming issues we know today have gone away by 2020?

[Note: Nigel on Google+ points out that Vodafone do offer a 'rest of the world' roaming deal -- £5 for 25mb a day and that is valid in the United States. Although this is certainly a lot better than this £3 per megabyte nonsense, my key point is the fact it's still crazy pricing. For instance £5 per day for my 2-week trip equates to £70.]

It’s nice to see an operator doing something a little bit outside the standard comfort zone of messing around with text bundles and trying to figure out how to boost revenue on out of bundle minutes.

Here’s the first para from the GigaOm post:

Canadian mobile carrier Rogers has filed to become a bank under Canada’s federal Bank Act, which will allow it to pursue more mobile payment services and a “niche credit card opportunity” for consumers, a Rogers spokesman told CBC. While it may look odd at first, perhaps banking could be the next stop for carriers. They already handle a lot of payments from consumers and have long-term billing relationships with users.

via Dreams of mobile payments lead telco to try banking — Tech News and Analysis.

During discussions about Nokia’s future, many a time I’ve indicated that executives privately point out they are hearing good noises from carriers in the context of their upcoming Windows Phone launch.

This isn’t just good news — it’s brilliant news. When you want to get as many devices out the door as possible, carriers are your friend.

Carriers — or operators, as I usually refer to them — are still very much the kingmakers in the Western marketplace.

As a manufacturer, your primary challenge is being ‘ranged’ — that is, accepted for distribution. It’s most certainly not guaranteed. Many a time, I remember being utterly despondent upon learning that (for example) the Nokia N93 wasn’t going to be ranged by a particular carrier.

If all the carriers line up with their arms crossed, the chances are you’re going to sell next to nothing in that particular territory. So ranging is important.

Once you’ve got agreement for the carrier to take your handset, the next issue is the subsidy. Although this is generally fixed, according to the cost of the device, there are frequent exceptions, especially when a carrier wants to exert influence. In some cases, this can be very influential. In other cases, as we’ve seen with the iPhone, it often doesn’t matter what the price is, the consumer’s going to buy it anyway.

Most manufacturers can, for example, estimate at what point the device becomes ‘free’ on UK carriers. e.g. If a Nokia handset costs £200, it’s most likely going to be free on 18-month contracts. If the device costs £400, it’s likely to be free on £40-ish a month contracts, usually 18/24-months. So manufacturers have an idea.

If you’re Nokia, heading out to market with an entirely new phone range, the best thing you can hear is carriers making excited noises. Aggressive pricing from carriers could well make or break the success of the launch. Indeed, there’s lots of whispering going around the market indicating that Nokia/Microsoft will get a lot of help from certain carrier groups, anxious for the perceived Apple/Google duopoly to be broken — or at least tamed. (RIM has a very healthy and highly integrated arrangement with carriers so I’m not counting them).

In terms of consumer perception, getting a free handset is something we in the UK have come to accept. In recent years we’re beginning to understand that ‘free’ and ’12-month contract’ isn’t quite compatible, unless you’re talking about a really, really cheap device.

But just how important is subsidy in the consumer mindset? Very.

Let’s have a look at how the Americans get on with it. In the States there seems to be some kind of wilful desire to avoid recognising the full cost of a device. As an example, let me quote the first paragraph from this GigaOM post published yesterday. Have a read:

Huawei, the Chinese company I soon expect to be a household name in the U.S. has a new handset targeted at first-time smartphone buyers. AT&T introduced Huawei’s Impulse 4G on Wednesday, with a Sept. 18 launch date. The Impulse 4G offers all the basics — and then some — of an Android-powered smartphone and will cost just $29.99 with contract.

via Huawei’s $29 Android aims at AT&T feature phone users — Mobile Technology News.

Look at the title!

A $29 handset? Wow!

No. It’s probably more like $150. Or $200. But when you’ve got media such as GigaOm breezily commenting on the purchase price as being rather impressive and then pointing out that it’s “with a contract”, you can see how influential subsidy really is.

AT&T who’re ranging the product could very well have made the up-front price $5. Or $7.99. Or $200.

Kevin, the author of the piece, continues his post with this sentence:

So what kind of smartphone does $30 get you?

Quite amazing.

But then again, this is how the States does it. There, the carrier usually chooses a price and sticks to it, no matter what your service plan cost (there are some exceptions).

In the UK, the up-front cost of the handset usually depends on how much you contract for. £15 a month and you’ll probably pay near full price for the phone. £45-50 a month and it’s nearly always free.

With this in mind, watch the carrier pricing of the Nokia Windows Phones. I think they will be competitively priced and enthusiastically marketed by the world’s carriers. (After that, it’s down to the consumer for the ultimate test)

How important is subsidy to you?

Sometimes I love it. I like the convenience. I like the ‘yeah, do it’ feeling — of being able to buy a phone without even having to get your credit card out. I do feel it 9 months later when I’m stuck with a £45/month price plan I don’t need — but with another year to go on contract.

I know quite a few Mobile Industry Review readers who have simply become subsidy independent. It’s a bit of an arse when it comes to buying new phones (all that cash up front…ouch), but you can get by on £10-20 a month on service fees.

What’s your poison?

I asked the team at WeDo to answer my questions to give us an overview of the fraud issue — my intent is then to explore the themes in more detail over the coming months.

So here we go — my questions are in bold. Over to Sergio Silvestre, Vice President and Chief Marketing Officer at WeDo Technologies:

- – - – -

1. Give us a background to the company, what are the products/services and what type of customer(s) do you serve?

WeDo Technologies was founded in 2001 and is owned by the Portuguese conglomerate the Sonae Group. WeDo is a Lisbon-based vendor that supplies Business and Revenue Assurance solutions and services, sometimes also called Profit or Revenue Protection, to the telecom, retail, energy and insurance and banking sectors. Simply put, this means using systems to improve operational effectiveness and manage risk – countering issues associated with fraud, credit control and data retention and management for example.

As trading conditions become ever more competitive and the technologies that support success continue to increase in complexity, system and business process monitoring and control activities have become vital to every company’s future. It is only by applying these intelligently and appropriately in both tactical and strategic ways that enterprises can deliver strong, direct and easy-to-track returns on their investment that directly impact on the bottom line.

It is only in recent years however that the software industry has finally been able to deliver the right tools at the right price and turn this concept into everyday practice. At the forefront of this development, WeDO offers both professional services and business consulting. Our business assurance platform, RAID, allows us to design and configure solutions to meet the specific needs of our more than 100 customers’ requirements and business processes. Currently, 7 out of 10 of the largest mobile CSPs in the world are WeDo’s customers.

2. Most of us reading will have a basic awareness of telephone fraud – i.e. tricking a call box into giving out coins or letting me call America for free. But nowadays, what constitutes ‘fraud’ in the context of the mobile industry?

It’s true that consumers might understand telephone fraud as simply jacking a call box, or tricking it to make long distance calls. However, fraud in the telecoms sector is a lot more sophisticated and varied than that – and is often conducted by highly organised groups of professional fraudsters who operate their own businesses and need to “service” their own customers.

Their business model for committing fraud spans all types of technology and crosses international boundaries, and has traditionally relied heavily on the CSPs’ inability to respond and recover in a timely manner.

Frauds can be launched using a variety of different methods – through the SIM card for example, stealing the identity of a mobile phone or hacking into the network, via the mobile subscription, through SMS and MMS schemes, voicemail, roaming, m-commerce and other new technological advances such as M2M and NFC.

3. Just how big a problem is fraud? Is it really an issue?

Fraud is a huge issue, not just for fixed or mobile operators but for all types of businesses. Fraud and revenue loss costs billions of dollars every year having steadily climbed over the years with no signs of abating – in fact all signs point to it being on the increase. Fraudsters were previously considered to be ‟opportunists‟, but experience shows they are now “business men” seeking out their prey by targeting specific CSPs or services that provide the greatest revenue return but at a substantial cost to the CSP.

Unfortunately for operators, the odds of being successful heavily favour the fraudsters as they know and determine exactly when the fraud hit will take place, and as the number of products and services in the telecoms and mobile worlds increase, offering new revenue streams, they are also opening up new ways for criminals to exploit them for ill gotten gain.

Fraud loss is not something that is recoverable – it is not like a revenue leakage issue that can be corrected or easily recovered from once detected. Fraud is a continuous battle with ever changing rules of engagement, and therefore effective fraud management requires a specific mindset, approach and strategy. Companies have to be savvy to this, employing fraud management and revenue assurance considerations to all their planning, ensuring they have best-of-breed fraud and RA (“revenue assurance”) solutions to detect frauds and irregularities in their network and curtail the damage. Those who don’t will pay the price in their margins.

4. Who is behind the fraud? Are they typically organised gangs or enterprising individuals?

Who is behind fraud varies between the industry and the market in which they operate. It’s very varied. In retail it can be an individual heading into the store and tampering with clothing tags and trying to move goods out of the store for example.

In telecoms however, fraudsters are typically well organised groups that are very knowledgeable about technology and networks. They need this level of understanding to launch attacks, as it is quite a sophisticated thing to do. They are very professional in what they do – so operators need to be at the top of their game to defeat them.

5. What sorts of fraud problems do new technologies like NFC and M2M throw into the mix?

Newer technologies like NFC and M2M can throw up a number of challenges for operators in terms of fraud and RA. A new range of M2M devices and the resulting end-to-end services will span consumer electronics, business enterprise, automotive, industrial/utilities and medical industries. The demand and requirements for this progression will ultimately result in more third party deals with strategic partners, and that in itself is a security risk. Are they trusted third party providers? Remote and unguarded locations, and a lack of M2M device control once deployed, could also pose fraud and revenue loss problems for operators.

When the billing model approach is different from a traditional SIM contract and M2M usage is not controlled or monitored until something actually goes wrong, then the threat of fraud going undetected and unstopped rises.

The problem with NFC is that it makes the interaction as simple as possible, without recourse to security measures such as PIN codes etc. Users just touch or pass very closely by an object to get or transfer the information.

This means the concept is open to a number of social and technical frauds and risks. Today the distance that the signal can be transferred is measured in centimetres, but it will increase. This is already being seen with chip based passports, where groups are attacking the technology to steal identity with a lot of success. Software is available on the Web to do this now and this uses the same RFID technology.

If you can steal an identity from a passport, you can also steal an identity from a mobile phone, and you can use that identity to purchase goods for resale.

Other threats exist in the form of malware and viruses, or even radio frequency interference, all causing RFID to malfunction resulting in revenue loss.

6. How do you fix the problem for your customers?

The battle against fraudsters will never be entirely won due to the fast moving telecoms environment and the drive to launch more complex products and services quickly to attract market share and maintain a competitive advantage.

This will always lead to procedural weaknesses and technical risks being introduced which fraudsters will seize upon at the earliest opportunity to keep their fraudulent “business” activities operational and profits high.

However, CSPs can deploy various defence mechanisms to mitigate against losses and ensure fast detection by ensuring processes are continually reviewed, staff are educated in new fraud trends, new products and services are assessed for fraud and security weaknesses and state of the art technology is used to quickly raise alerts for suspect activity. What is needed is a balanced approach that takes into consideration technology, people and processes working together and supported by executive level management to create an effective fraud strategy. This will enable effective defence mechanisms to be deployed in the right places at the right time.

7. Where do we find out more?  Whitepaper? More information on the site?

If you visit our own site — or the site of our business consultancy division — you can find out more information about what we do and the areas of fraud management and revenue assurance. We have published a number of whitepapers on topics from increasing profits operations and management and telecoms fraud management to more specific looks at smart metering and embedded mobile (M2M).

- WeDo Technologies Publishes Best Practice for M2M Fraud Protection and Security
- How Mature is Fraud and Revenue Assurance industry now?

8. What are the biggest telecom frauds?

International revenue share fraud cost the global telecoms industry a few billion last year. It’s a very sensitive area that must be approached in a sensible way. Fraudsters racked up this sum by generating high volumes of calls to premium rate numbers, or countries with high termination rates. A premium rate number fraud typically involves web-based resellers of high-value international numbers.

Fraudsters acquire the numbers and then generate high volumes of calls to the numbers in order to ramp up their share of the revenues created. We predict that the issue could get worse as operators transition to all-IP networks. The pending risk makes it all the more important that operators’ fraud management systems are closely integrated with revenue assurance setups and can adapt to rapidly changing attack scenarios.

9. Which regions are specifically suffering from these frauds?

All regions of the world suffer from fraud. It’s a global problem and very difficult to pick out areas where it’s particularly bad. A common trend is that frauds are perpetrated from countries that don’t have so many formal extradition deals, from smaller island jurisdictions or from countries that are not internationally recognised. Many frauds are perpetrated from the developing world countries against networks in more developed countries. But that isn’t gospel – it’s a hard question to answer. If you have the knowhow you can perpetrate frauds.

- – - – -

Thank you for taking the time Sergio!

I’m aiming to meet with WeDo Technologies soon to see if I can capture them on camera.

Last week I looked at the issue of SMS and how operators still have time to leverage one of their strongest assets — messaging and the phone number identity that underpins it.

This week I’m looking at added value — or semi-intangibles. I’ve often remarked before that operators need to get into the lifestyle business more. For large sections of the population, call minutes and text messaging bundles are a known quantity. Yup. Next. Move on. Is that really all you can offer me? More minutes? Double minutes? 3.5 extra minutes if I call between the hours of blah and blah? Double texts on a Tuesday if I top up with a fiver?

What if I’m a contract customer?

This is where it gets increasingly frustrating for certain segments of the operator market.

There’s a lot of people out there who define themselves as sovereign individuals. They might be contractors or perhaps self-employed. They are, fundamentally, business people. They’re either total entrepreneurs or they have a wild entrepreneurial streak that surfaces regularly. And they ‘speak’ brand. They have the best watch, the nicest suit — they research the best case for their iPad 2, they buy the highest quality accessories for their top-of-the-range Sony ultralight laptop or their Mac Air. They eat out regularly in nice restaurants. In the absence of religion or traditional class structure, they define themselves by brand consumption and allegiance.

And their operator is ignoring them. Chances are, the operator is busy trying to flog SIMs to the fabled 16p-annual-ARPU mass market, whilst totally ignoring the segment of discerning customers with large amounts of disposable income to spend.

I suspect that if you’re reading Mobile Industry Review, you probably fit into this sovereign individual category. You may well be an employee but I’m sure, at minimum, you have some level of entrepreneurial streak. Otherwise you’d be sitting watching Jeremy Kyle instead of reading this.

So please do run with me for the moment.

Ben Smith was describing to me his abject joy at discovering T-Mobile have apparently introduced a price plan ‘booster’ that, for £15 a month, offers unlimited BlackBerry data worldwide. He explains the full offering here.

“Really?” I asked, my excitement rising.

“Yes, really,” he confirms. He actually had to do a heck of a lot of confirming. He didn’t believe it. Neither did I.

But yes, it’s valid. Obviously there are some efficiencies to be gained from BlackBerries due to the way they manage and route their data traffic. RIM are ultra efficient with data consumption on their devices.

This price plan ‘bolt on’ had me reaching for the phone. I am nigh-on almost ready to swap to T-Mobile as my primary operator for this, given how much I use my (BlackBerry) abroad.

But I haven’t swapped.

Not yet.

It’s not quite enough. It’s certainly almost there, but not enough to get me to switch. I’m ‘ok’ paying £2/day for 25mb in Europe to Vodafone at the moment.

This got me thinking. What would make me switch? What would it take?

I think I need more.

Sell me the lifestyle. Sell me the benefits. Let me feel good. Give me something that makes MY spend with T-Mobile look better than my friend’s spend. The fact I can’t easily differentiate operator choice between my peers is bad news.

I’d like the best. This segment really does £59 on a super-quality leather case for their iPad/iPhone/MacBook Air.

So what would get me excited?

Well, I traveled to Ireland last night. I popped into Heathrow Terminal 1 to take the Aer Lingus flight to Cork as I’m attending a wedding this weekend. I had some food at the ultra shit but very nicely appointed “The Goose” pub and waited for my colleague Rafe Blandford to arrive.

It’s at this point that I thought I should have ‘lounge access’.

Why doesn’t my operator offer me this? If I’m thinking about buying a global data roaming package, chances are I might also want to get airport lounge access too, so I can do some work. Or get a free mini can of coke along with a biscuit.

I’d like to explain to Rafe that my T-Mobile GlobalPlus+ price plan gets me and one friend into any airport lounge on the planet.

I’d feel good. Rafe would feel good too. And probably make a mental note to investigate that price plan for himself later on.

It does actually make sense — if you’re buying an international data roaming package, chances are you’d like that too.

But there’s more.

Why not sell me a Boingo Wireless account too? So that, thanks to being a customer with T-Mobile, I can get access to every possible hotspot on the planet as well.

Airport lounge access? That’s valuable.

WiFi anywhere? That’s valuable.

So when I’m looking down the price plan option list, why not add these on? These kind of semi-intangible options really do start making folk feel good. They represent (at minimum) a perception of value, even if you actually only go abroad twice a year.

I could definitely imagine paying a fiver or a tenner extra to T-Mobile each month so that I got access to their suite of GlobalPlus+ fancy sounding offerings.

All of a sudden, T-Mobile can start extracting additional cash for more than just minutes, texts and data.

I’d really like to see a lot more experiments in this regard. What about, for example, adding in Regus office support? Pay £100 per month and you get ‘planet-wide WiFi access’, priority airport lounge access and the ability to ‘touchdown’ at 1,100 offices worldwide?

Now it’s a real business tool for me, not just a commodity..

What do you think?

- – - – -

Check out the other posts in the Operator Innovation series:

- Let me access my SMS everywhere
- One number for all my voice calls
- Fancy a MacBook Air, iPhone, iPad for £100/month?
- Why can’t my operator talk to my bank when my card declines abroad
- Taxis, baby, Taxis!

(See: “Three UK: Fascinating example of a missed sales opportunity“)

Well, it was the same again this afternoon. This time it was a lady, Samantha, calling from India.

“Is there anyone there on PAYG that you’d like to add as a new line?”

“No, I don’t need a new line,” I said, “But I would like to discuss upgrading my existing lines.”

I have 3 different contracts with them.

This is exactly the same as I told the guy who phoned a few months ago.

The lady was very polite.

“I’m afraid I can’t help you there,” she said, “You will need to speak to the Upgrades department.”

Well that’s hardly helpful is it, I thought, if you’re calling to get more business from me?

Anyway. This one surprised me:

“Would you like a new laptop or an iPad?” she asked.

Now then, if she’d been offering a MacBook Air? Yes. But she wasn’t. She was, I suspect (although I didn’t ask) offering one of those laptops the company sells.

“As for an iPad,” I answered, “I’ve just bought one from Vodafone two weeks ago, sorry.”

(Read also: “Vodafone: A fascinating example of a super sales approach“)

“Do you want another one?” She asked.

“Alas no,” I said.

I was being good.

I thanked her. She thanked me and I hung up.

Dear me.

What a shame.

So once again, an outbound sales call seems to mean “add a new line” as far as 3 are concerned.

This time, though, at least the lady was talking about iPads. Alas my situation has changed, because 3 was stupid-slow.

Surely .. SURELY the chap last time should have sent my details over to some bod in the Upgrades team and said, “Look, this chap is ready to spend some cash?”

As it happens, 3′s social media team did their best to connect me, however I was all-over-the-place work wise in the proceeding weeks so didn’t manage to speak to them.

Then Vodafone called out of the blue, offered me an iPad, bang, done.

That money should have gone to 3. If they’d been fast enough. If they hadn’t hamstrung their sales people with these stupid policies.

How STUPID is the 3 sales management team? How STUPID? When your sales people are phoning and I’m saying the equivalent of, “I’d like to give you more money, only not in the configuration in which you expect?”, don’t you think they should be given the opportunity to do business with me?

Isn’t this ridiculous?

At some point I need to re-organise my lines with 3 and that probably means spending more money. Especially when you dangle new stuff in front of me.

So that was a second call from 3 where, due to their own stupid, STUPID service configuration, they can’t help me.

Why didn’t the lady just transfer me to upgrades?

I had no specific intention of dealing with my 3 account this afternoon. It’s been lumbering on. The direct debits come and go. My iPhone 4 is performing fine. I’m still using my 2 broadband accounts with them. I’m reasonably content. Just, I could be up-sold rather dramatically. Since they phoned though, I moved my mindset — I was ready to do business.

Deary me.

Now then, what happens if operators were to deploy these rather innovative plans such as the one mentioned above? It’s a topic I’ve been exploring whilst I’ve been on-site at MACH Insights 2011.

I explored this question in another video thus:

I could imagine many consumers simply loving the flexibility of being able to upload photos, reply to messages, add status messages and so on, whilst on holiday. There must be millions of people who simply do not bother because they are afraid to bill shock — or they’ve already learnt an expensive lesson about roaming abroad.

If operators charged for the service fairly and transparently, I think consumers may well respond positively to it. One of the key points about service-based charging (i.e. Youtube, Facebook, Google Maps Navigation) is that consumers understand it. They get it. They know what it means. Nobody knows what 1mb means.

However, let’s just assume one particular operator was really, really successful with a Facebook-style roaming offer. Remember it’s stupidly-easy to target consumers. You just need to modify your introductory welcome text message accordingly. You could even prioritise customers on higher price plans or who have a history of using Facebook domestically but who suddenly stop using it whilst abroad.

Assume that, I dunno, 2 million customers go on holiday in a given month.

1 million of them opt in for the service and actually end up spending a tenner each (say 5 days x €2) for Facebook. That’s a cool €10,000,000. Factor that up across an operator group with, say, 10 similar geographies. We’re now at €100m additional revenue.

Still with me? Suspend your disbelief whilst I continue the example, I know there’s plenty of holes. Let’s assume that the operator can achieve these revenues fully during one quarter (the summer months) and then only 25% during the rest of the year.

3 summer months = €300m.

9 months at 25% of €100m (9 x €25m) = €225m.

Stick it all together and we’re over half a billion Euro at €525m revenues.

Now as I said, there are plenty of holes. Plenty of holes. I’ve made a ton of assumptions.

But I think the point is still valid.

At what point does Facebook think it deserves a bit of that revenue?

For all the talk about 4G and LTE and genius amazing whiz-bang gizmos, the basic reality is that when I hit ‘dial’, I expect my call to be connected. I am intolerant of any exception.

In Michael’s example, he explains how the utterly brilliant black-cab taxi service Uber, highly popular in San Francisco and New York, failed to meet his needs — because AT&T couldn’t connect a call:

Yesterday I requested a car and even though the app showed the car as arrived and on top of me on the map, it was nowhere to be found. I called the driver (a handy feature in the app), but our connection was so bad that we couldn’t communicate. So I hit “cancel” (a $10 charge to me) and walked to my destination instead.

via Uber To Dump Hundreds of AT&T iPhones, Switch To Verizon.

The CEO of Uber, Travis Kalanik reckons that they may well make a total switch from iPhones running AT&T to iPhones running on Verizon. Just to get proper connectivity when their drivers need it.

Ridiculous.

I understand Kalanik’s perspective, but goodness me, when things get that bad with AT&T, it really does demonstrate that no amount of 4G marketing magic can hide the continued failure to deliver basic connectivity in these geographies. Whenever I’m in NY or San Francisco, I definitely, definitely do not even think of using AT&T. It’s Verizon or Sprint all the way for data (through a MiFi or dongle) and T-Mobile to enable my GSM calls for my European devices.

However this morning I’d like to raise a very basic problem I still have with my phone. And I’d like to propose an ultra basic solution for your review and comment.

Here’s the issue:

Reduced down to the basic consumer layer, my primary phone (BlackBerry Bold, as it happens) functions as a device to make and receive calls.

That’s all good.

Anyone can phone me.

This is also good, generally — with quite a few exceptions, but — fundamentally — my device can make and receive calls to any number.

I’ve got an address book on the phone that is synchronised wirelessly with Google. The address book has two functions:

1. When I want to call someone, I don’t have to remember their ‘digits’, instead I just find their entry and choose a number (home, work, mobile, mobile 2).

2. When someone I know calls me, instead of displaying a telephone number, the address book enables my phone to say ‘Ed calling’.

It’s this second point I want to discuss.

‘Ed calling’ is a billion times more useful to me than seeing, ’07277 271883′ on the display.

That’s where the innovation stopped, though.

Or, more accurately, the ability to see who’s calling (“Caller Display”) was where it all stopped.

At their inception mobile operators copied their fixed-lined big brothers and dutifully implemented the feature into their service.

This was fantastically useful at first.

In today’s hyper-connected environment, the limitations of the feature are an embarrassment.

Here’s why:

This morning at 3:55am, my phone rang. I reasoned that it was probably the taxi driver calling to announce his arrival.

I looked at the display.

And for the first time, I actually thought to myself, ‘What the fck is this?’

I suppose it’s the strange lucidity you sometimes get at odd times in the morning.

‘Why,’ I thought to myself as I stared at the BlackBerry’s screen, ‘am I putting up with this rubbish?’

I was pretty sure it was the taxi driver calling.

But why couldn’t my mobile operator tell me this?

I don’t need to know the phone number. Oh, it’s useful if I want to phone back. But really, I need to know the context of what’s happening.

‘Taxi Driver for Heathrow’ would make a ton more sense to me.

And surely there’s a way of easily plugging this stuff all together? The fact that I approved the call? The fact that the taxi firm HAVE my mobile details — couldn’t they be ‘approved’ to be able to display status and context to my phone, rather than the default number?

Is a call even necessary? Couldn’t the phone just turn green? Or flash red? Especially if the device knows I’m awake and operational, I certainly don’t need an interruption beyond ‘your taxi is here’. Like a growl update.

And if you do need to interrupt, do it with some kind of contextual information rather than a phone number.

Alas, I don’t think we’ll ever see anything like this from the mobile operator — despite the operator playing the role as the ultimate trusted party in the value chain.

Unfortunately, the operator continues to surrender almost everything beyond the mobile nuts and bolts. The job of fixing this kind of issue is strictly limited — for an array of silly reasons — to the likes of Google, Facebook and Apple.

Imagine the possibilities. The operators could implement this, jointly. Given the amount of handsets they retail, it would be relatively easy for them to require every new handset to be ‘mobile operator context aware’.

And for £0.59 per month, I’d pay for the privilege. So would millions and millions of others.

Now then, how would you plug it into the taxi driver? Well, whenever he’s calling an approved number (i.e. me, as a customer), his device should be enabled and approved to be able to send more than just 11 digits to me during a call.

I like the idea and application of trust in this stuation.

The rather shocking reality is that, given I was expecting the possibility of a call this morning, if ANYONE had phoned me around 4am and said, ‘Your taxi is outside, Sir’, I’d have — I’m rather embarrassed to admit — assumed it was the taxi firm calling. The telephonic equivalent of being socially engineered?

What do you think? Totally ridiculous or something you’d like to see?

I had to knock out a brief comment on this Financial Times post. Here’s the first few paras:

Leading European telecoms companies want to levy significant charges on Google and other online content providers through an overhaul of the regime governing how data travel over the internet.

Operators in Europe complain that they are contending with an explosion of data on their networks, much of which comes from US sites such as Google’s YouTube video service.

It’s just shocking.

Shocking.

Tons of Youtube and Facebook traffic? You don’t like it? Think that demanding a load of cash from Google is a quick and easy fix? Oh dear. Oh dear me no, no, no.

First of all, what the hell am I paying you for, Mr Operator? That’s right — I pay you for this already. Now it’s your problem if you’ve got the model wrong and can’t afford it. Change your terms and conditions accordingly. That’s my first problem.

But as for charging Google or seeking to make it Apple’s fault and demanding they pay? Oooooooffff. OOOOFFFF!  Oh no.

You don’t want to have that conversation. You really don’t. Not with the Silicon Valley super-egos. Oh no. Not when — for example — Apple has $60 billion in free cash sitting there waiting for a problem to fix.

Would you, Mr Operator, like to be that problem?

Step into my office. Take a seat.

Here’s what we’ll do. You think carrying Google, Apple and Facebook traffic is a bit of a ball ache? Too much hassle? And you can’t be bothered to innovate your way out of the challenge? Fair enough. As of 1st of June, we’ll deny all traffic to your piddly little operator.

Well, no, actually. What we’ll do is this. Anyone requesting Facebook.com from your piddly little operator IP range will get a 500 byte HTML file in return, explaining that the content is unavailable from your bollocks network.

That’ll solve your data crunch nightmare overnight, won’t it?

Right.

And then we’ll do a deal with the number two in the market — or, better still, we’ll buy them. Or, actually, it’ll be quicker to do a deal with those LightSquared folk to move you into irrelevance in the next few years.

Actually yes — are you still comfortable? Good. Here’s what we’ll do. You can have some cash. Yes — you heard us right, we’ll pay you as you demand — we’ll pay you to sit there and play dumb, Mr Operator. You can have a few hundred million from us. You’ll think that’s a real result. It’s pocket change in the context of what we’re planning. It suits us to pay you to keep quiet whilst we sort out a better solution. We know you’ll take our cash contributions and spunk it up the wall anyway. You’ll take the cash and you’ll start thinking of it as a ‘revenue stream’ when actually, it’s a set of handcuffs.

Ah dear.

I think it’s reasonably fair to say that your average billion dollar mobile operator couldn’t innovate its way out of a wet paper bag.

Where’s all the smart thinking?

For the avoidance of doubt and for all the people sitting in the propositions and strategy teams trying to coax some kind of strategic-whitepaper into life for the utterly confused telephone men running your operator, here’s a few suggestions:

- Assign all standard mobile internet connections on your network a consumer grade 25k/second throughput. This means I can still do stuff with my internet connection, but that I’ll have to think twice about watching the T-Mobile Royal Wedding Spoof video in high quality, on the bus, for the 18th time today

- Tier your price plans according to speed (e.g. Everyone gets 25k/sec for free, £5/month gets you 50k/sec, £10/month gets you 100k/sec and so on — and these speeds will all be adjusted uniformly according to the available bandwidth on the cell)

- Tier your price plans according to application (“Do you want HQ video with that? Really? That’s £15 extra a month”) — give consumers the choice

- Charge me for the video, not Youtube. Pop-up a little note at peak times asking me to agree to a £0.50 charge to stream the video in HQ. Otherwise make me wait 30 minutes for it to finally arrive on my phone.

Here are some other related ideas I wrote back in December.

Some of those points above are contentious, yes. It’ll certainly stimulate debate. But that’s what we need. The consumer needs to be educated that cell access is a finite resource. Give everyone a basic service to avoid the net neutrality wonks choking on their beards. But since it’s a finite resource, price it as such.

Orrrr… refer everyone to Hutchison’s 3UK who currently offer proper unlimited everything on their data plans.

New research from Ofcom-accredited mobile bill analysis firm billmonitor has revealed that more than three-quarters of UK mobile subscribers are on the wrong mobile contract, wasting £4.899 billion every year (an average of £194.71 per person). The findings revealed that over half of subscribers (52%) are on too large a tariff, using on average just one quarter of their monthly calling allowance; 29% are on too small a tariff, wasting a total of £1.53 billion; finally, a further 19% have the right level of inclusive minutes but are wasting £0.74 billion by not choosing the right contract length or optimising other costs.

What’s does Acision’s top mobile billing chap Steven van Zanen think?

“The explosion in mobile data usage in the wake of the proliferation of smartphones and tablets has transformed the ways in which we use our mobile devices. Mobile social networking, gaming and video streaming are now all common activities and these in turn are affecting the costs which users are incurring. This new research is a further illustration of how existing mobile tariffs are out of step with consumers’ usage habits.”

Agreed. It is ridiculous. I know why the operators are doing it, but I think the time is fast approaching when the price plan as we know it (in terms of minutes and texts) will be obsoleted.

“As both devices and subscribers’ usage habits have become more sophisticated, the standard ‘one-size fits all approach’ to mobile charging is ineffective. Central to providing a greater level of consumer confidence in billing is giving them the power to control and manage their spend in real-time. Recent research from Acision highlighted that over 40% of consumers  would be willing to pay for notifications which would prevent out of package cost, reinforcing the consumer demand for greater control over spend. In this way, offering a charging facility which allows consumers to track their mobile spend in real-time provides operators with a unique opportunity to derive genuine competitive advantage in a fiercely contested market.”

I’m with you there Steven. But again, I can see why the operators are quite happy to just sit in silence — no news is good news, because the consumer is either over-using (in which case, they’re paying a premium) or under-using (in which case, you’re making a nice profit). Give the consumer too much clarity and you could see your profits drop quite substantially.

The other way to look at it is by giving control, as Steven asserts, you enable the consumer to choose where they spend their money. It’s then over to the operator to demonstrate value, rather than hiding everything away with obtuse billing plans. If I got a note from Vodafone to let me know when I’d hit my text message limit, or my minute bundle limit, the chances are I’d probably phone up and upgrade to the next plan. Even better, if the alert service could do it for me.

Still… dangerous talk, all this ‘innovation’.

Son said that as SoftBank’s leader, it makes him feel uncomfortable to hear that disaster victims and their friends and relatives have trouble in connecting and obtaining information. And while he was at it, he also promised that the orphans won’t be charged any communication fees until they reach the age of 18.

via Japan’s SoftBank To Offer Free Phones, Waive All Communication Fees For Quake Orphans.

Nice to read about mobile operators doing good.

T-Mobile is refusing to offer any compensation citing ‘Force Majeure’.

Now then — should customers get a refund? Or some free text messages? Or, if you’re on a €40 per month contract, should you get €1.30 (i.e. one day’s fee) credited?

Or since these kinds of interruptions are few and far between, should users just suck it up?

I think some type of response is useful, especially if it’s a catastrophic outage that prevents people from doing business. You could even credit everyone 100 free text messages that must be used by the end of the month (knowing full well that most people won’t even bother using them). It’s the thought that counts.

What do you think?

- – - – -

Facebook is shaping up to be a strong competitor to mobile operators that are in danger of underestimating the threat it poses, according to Ovum.

In a new report* the independent telecoms analyst states that Facebook is much more than a social network – this is just a starting point and its domain spreads much wider. However operators are being slow to wake up to the extent of Facebook’s ambitions and tend to view it as benign, non-competitive presence that they are keen to form partnerships.

Eden Zoller, author of the report and Ovum principal analyst, said: “Facebook is encroaching directly on mobile operator territory and should not be underestimated.

“It has come a very long way since it first launched Facebook Mobile in 2006. It is now a force to be reckoned with in mobile with over 200 million users interacting with the service via mobile phone. It is much more than a social network and is better viewed as an increasingly rich platform for communications and content. Facebook wants to integrate with everything and be the main way that people consume and share information, anywhere and on any device.”

Facebook has made several moves that have placed it in competition with mobile operators. It has an integration deal with Skype for voice communications and in November 2010 unveiled an email offering. Meanwhile, it is turning increasing attention to location-based services with its Places platform and is pushing into mobile advertising in the shape of the Facebook Deals ‘check-in’ service. Facebook apps dominate app stores across most smartphone operating systems.

Zoller continued: “There is also intense ongoing speculation that Facebook will come out with its own phone, which in some respects would be the final piece of the puzzle. However, we don’t think that Facebook is any rush to launch its own hardware just yet, although it could be interested in working with partners on a customised device platform. This would in effect make Facebook a social operating system.”

Despite this competition from Facebook, mobile operators are keen to partner with it, for example by offering easy access to its services and address book integration.

Zoller added: “While there are good reasons why operators should wish to partner with Facebook, they should be more alert to the fact that it is shaping up to be a strong competitor. It is only by understanding Facebook fully that operators can engage with it effectively, be that on a collaborative or competitive basis.”

- – - – -

I do wonder as to whether an official Facebook phone is necessary, given all the effort it would require — and given that the market is doing a pretty good job of this (witness, for example, the new INQ Android devices or the HTC ‘Facebook Button’ phones).

A much more exciting point would be Facebook deciding that the mobile operators are getting in the way and lease or buy it’s own mobile operator capacity to deliver next generation services to its users that operators are either unwilling or incapable of doing themselves.

One company I met on Sunday morning prior to MWC was apoplectic with rage about Facebook, Google and Apple. I won’t go into detail about the company’s identity except to say they’re a highly influential service provider to the mobile industry.

This company’s perspective was very similar to that of the France Telecom and Telecom Italia Chief Executives (detailed in this post). The collective view amongst many in the mobile operator space is that these ‘b@starding companies‘ (direct quote) ‘are screwing up the network for everyone and not paying a cent toward the network upkeep‘.

It was a fascinating discussion. I listened for a little while before asking this series of questions (I admit to teeing the guy up for the final one):

Q: Do you think it’s unfair that Facebook, Google, Apple and so on are not paying for the use of the mobile network infrastructure?

A: It’s insufferable. It’s ridiculous. It’s outrageous. (I’m paraphrasing his exact words. He used a few F-bombs too — highly entertaining.)

My next question:

Q: But the consumers themselves accessing Google, Facebook and whatnot, they’ve paid their mobile operators for the privilege, right?

A: Yes, but it’s highly irresponsible of these companies to keep on introducing new services that are causing [the industry] to have to spend more and more money maintaining quality of service. (Paraphrasing again)

My final question:

Q: Ok, so how would the industry react if, for example, Facebook simply switched off mobile access for every one of it’s 650 million users and charged the mobile operator £3 per month for the privilege of delivering Facebook content to the consumer?

A: [Silence for a few seconds, followed by a look of horror]

Heh. What happens when Facebook decides to tell the market that it can no longer afford to maintain it’s hugely expensive bandwidth and server infrastructure without the mobile operators coughing up. That could become a rather sticky conversation. Unlikely. But at least the example made this chap — previously apoplectic with rage — sit back and take stock.

I don’t think many people in the marketplace have thought things through when they argue that mobile operators are victims in the ‘data crunch’. It’s laughable that these giants are demanding the biggies like Google and Youtube cough-up when the consumers accessing these services have already paid to do so.

If the model is broken, fix it. Simply doing a T-Mobile and deciding that ‘unlimited’ means 500mb of data per month is silly. And offering ‘unlimited’ 250mb plans is ridiculous. It’s a guaranteed way to ensure consumers think twice about doing anything on their handsets in fear of bill shock.

It’s not about the race to zero. For some reason, the mobile marketplace is consumed with this race to zero. To be the cheapest. To offer the cheapest rubbish because that’s the only thing people will pay for.

Nonsense.

Innovate. Truly innovate. And we’ll see some excitement and delight spreading across the market from consumer to operator.

You can see some of the ideas I’d like to see from operators in terms of innovation here.

Meanwhile, it’s not just me speculating about Facebook. The industry analysts Ovum have been doing so too. I’ll be publishing a post from them on that subject in just a moment.

This is excellent news.

It means that shortly, if you’re an App World user, you’ll be able to pay for your downloads via one-click carrier billing, rather than having to type in your PayPal details.

Although PayPal is highly useful, it’s a total arse for me because the service insisted I use a crazily complicated password to prevent hacking. Which means that actually using PayPal is a Cecil B DeMille production involving copious copying and pasting. Just bill me. Hit me. Just get it done. This is what I want from App World. I just want to get the app or the content. Ergo, I think RIM will shortly find a heck of a lot more downloads completing when it introduces the service across these new operators.

I’m also looking forward to hearing from application developers who should really, really benefit from this news.

It’s not just payments for downloads — you’ll also be able to charge in-app payments to your bill as well. Absolutely fantastic. Whenever I’ve looked at any conversion statistics in the context of carrier billing, the numbers are always off the charts compared to credit card, PayPal and so on.

If you’re a Vodafone customer, expect App World carrier billing to be available for the following countries: United Kingdom, Germany, Italy, Spain, Portugal, the Netherlands, Greece and Ireland. More countries to follow suit.

No word yet on which Telefonica and Deutsche countries will get carrier billing on App World but I think it’s a fair bet to assume the UK and Germany will be enabled as a priority.

Good news, RIM.

I’ll be popping by their stand later today to have a wander around. More shortly!

- o2
- Orange
- Three
- Vodafone

Only one of those networks, o2, has actually installed the gubbings on their network  to enable Apple’s visual voicemail service.

The rest of the operators couldn’t be bothered.

I mean that, quite literally.

Voicemail — as I highlighted in the Future of Voicemail video series last year — hasn’t changed for about 15 years. Indeed, some of the equipment and services running on some networks is almost that old.

Apple prompted a small revolution in the voicemail marketplace with the introduction of their visual voicemail service. Similar concepts had been around before, but none had been so beautifully conceived or so well presented into the consumer consciousness. The ability to browse your voicemail messages and choose the ones you’d like to hear first contributed significantly to the ‘oh my god that’s amazing moment’ that many in the mobile world experienced at the introduction of the first generation iPhone.

Magic.

Every o2 customer got the brilliance of visual voicemail when they signed up for the service.

Then when Apple permitted the other operators here in the UK to supply the iPhone, they didn’t require visual voicemail compatibility. They obviously left this to the operators themselves to deal with, assuming that, well… of course these operators would want to offer customers the best possible experience. And, of course, they’d probably see what had been done on the iPhone and want to extend those services to other devices used by their customers. Of course. This wasn’t Apple’s concern.

Apple got on with marketing and developing new products.

The ‘non-exclusive’ operators (Orange/Voda/Three/TMO)  carried on doing nothing.

You won’t be surprised to hear that product managers and senior executives at each of these operators have been busy doing nothing. You know, having lunch meetings, off-site days, strategic reviews, product development seminars and lots and lots of meetings to discuss visual voicemail.

First and foremost, should they bother blowing the cash to give their iPhone customers visual voicemail?

Well.

No.

Why not?

Well — when they launched the iPhone, nobody actually noticed visual voicemail wasn’t supported.

I did.

I was entirely disappointed to see that the voicemail feature on my Three, Orange and Vodafone iPhones is simply a button. You tap ‘voicemail’ on the Phone menu and instead of seeing the visual voicemail layout, you… well, your iPhone calls your voicemail. Like how your feature phone from 1998 used to work.

Is it a big problem?

No.

And this is why the operators haven’t bothered. This is why those product development discussion forums with sandwiches and biscuits yielded nothing.

Because the operators were thinking cash.

Why bother spending the cash implementing visual voicemail for just one (albeit reasonably popular) smartphone on their network? Nobody’s really complaining — and if they do complain on Twitter, just recommend they download HulloMail. Everyone’s a winner, right?

No.

It’s about innovation. This is one of the fundamental problems with the sodding UK marketplace. It’s filled with complacent couldn’t-give-a-toss operators shovelling the same mildly shit services to their consumers each year.

Show me the innovation in the UK marketplace?

There was a study done recently — I cannot for the life of me find it — but it was about mobile data. I think it was an operator in Asia that did the study, although I also seem to remember it being a British operator. Forgive me, I can’t remember.  Anyway, there’s a point I’d like to make with it. The research went along this lines:

“Would you spend more money on better quality data services?”

The majority of people interviewed said yes.

This shocked the operator in question to their core.

They really didn’t expect people to actually say yes, such was their assumption that all the consumer cares about is price. Which means there’s no point investing in anything new because you assume nobody wants to pay for. With few exceptions, this is precisely what goes on in the UK marketplace, right? If anything, it’s the other way around — with operators panicking about mobile data and trying to reduce their expenditure and network expansion exposure costs [Witness T-Mobile UK deciding to make 'fair use unlimited data' mean 500mb].

Whatever country the study was from it doesn’t matter. I firmly believe that much of the UK’s mobile consumers will be delighted to pay more for better stuff.

It’s only about price when you can’t, don’t or won’t make it about anything else.

Back to voicemail.

I’m surprised at Three. You’d have expected a challenger brand like them to have sorted out visual voicemail for every sodding smartphone in their ranks. Goodness me it’s not difficult. 5 minutes on the phone to Shawn Barber at Acision will sort it. Or a quick chat with Andy and the team at HulloMail. It’ll be sorted in a jiffy. Yes there’s going to be some budget required, but come on — innovation, anybody? Three clearly still can’t decide whether it’s chasing the triple-A £50-100/month customers who want brilliant data services or the market’s Vicky Pollards delivering 2p per month ARPU.

If we can’t get visual voicemail working for the UK’s smartphones, how the hell are we meant to finally see 4G arrive? Or multi-sim service with the same phone number? Or distributed SMS services that arrive on every one of your phones? Or international roaming that doesn’t require you to spunk a month’s wages uploading a photo to Flickr in Spain?

It’s a sad, sad state of affairs, it really is.

What would it take to deploy visual voicemail to every… BlackBerry, Nokia (smartphone), WP7, Android and iPhone in the UK? I can think of a bucketload of suppliers who’d be delighted to assist. You either put a client on the device (or encourage consumers to do so themselves) or you make the device’s existing API capabilities tie straight into the network.

This is not rocket science.

And frankly, if we’re talking about ‘visual voicemail’ within a mile of the word ‘innovation’, we’ve already got a big, big problem.

Only this evening I was sitting on the train naively assuming that I’d be able to phone my wife without incident. The train travels at about 30mph generally. It plods through stations and the journey takes about 35 minutes. I rarely actually talk on the phone during the regular journey just because I’ve typically got other stuff going on with email and so on.

But today I thought I’d try a phone conversation with my wife. Little baby Archie’s got some teeth on the way so he’s not been keeping too well — I thought I’d enquire as to his status.

And — like the geek I am — I did some real time processing of my mobile situation. I recognised that at 30mph the hand-over between the DECREPIT piece-of-shit UK phone networks should be able to cope with me swapping from cell to cell no problem. I understand that at 110mph or similar, it’s sometimes a weee bit difficult to keep a call open when you’re having to contend with multiple blackspots, tunnels and when you’re traveling through multiple cells every minute.

But at a leisurely 30mph, I thought I’d be fine.

I was cut off three times.

Three flipping times.

And I had all that sodding audio bollocks to deal with. You know, where my wife suddenly starts sounding like a Dalek. Or when I have to keep on saying ‘are you there’ because you can’t hear properly.

After the third time I just sent her a text. “Rubbish signal.”

She replied “OK.”

How sad is it that in 2011, we still accept this?

The lack of innovation, they lack of measurable improvement, the total (unintentional) disregard for the betterment of the marketplace… it’s simply breathtaking.

Surely it’s not all about money?

What the hell are all these product managers doing out there? Standing, staring at the wall, going home at 430pm and not bothering to face up to the ‘tough’ innovation questions like visual voicemail?

It’s not just visual voicemail. It’s the whole raft of things that you and I would love to see.

A little while ago, I was appalled to see a bollocks T-Mobile advertisement in the newspaper where the company tried to differentiate it’s iPhone offering by explaining that if you buy an iPhone on their network, they’ll let you change your ‘Flexible Boosters’ each month.

Total flipping bollocks.

“That’s it?” I wrote, “That’s all your product teams can come up with?” Buy an iPhone from us and we’ll… we’ll let you change your ‘unlimited landline calls’ to ‘unlimited texts’ or ‘same network calls’ each month. Rubbish. Absolute rubbish.

So uninspiring that I thought it was about time I explained what I’d like to see in terms of innovation. So I wrote a post off the top of my head: “Here’s what I’d like from T-Mobile (or any UK operator!)“

I was so incensed that I actually wrote the whole post on the train using the BlackBerry. (The very same one that I can’t make calls on).

To all the product managers, market segmentation geniuses and business analysts, could you please put the following in your pipe and smoke it:

I’m in dream mode now. Here are some advertising messages I’d really like to see [in place of the uninspired shit they'd published]:

- At T-Mobile, we’ve prioritised our iPhone traffic so Facebook will load 28% faster than Vodafone, Orange or o2 customers with the same phone.

- At T-Mobile, we’ve peered directly with top sites like Google, Facebook and Yahoo. So your smartphone accesses those sites roughly 2-seconds faster than anyone else.

- At T-Mobile, we’ve upgraded our network with Nokia Siemens Networks cellular technology that, on average, will keep your iPhone’s battery working 19% longer every day.

- At T-Mobile, if you put more than four devices on our network and spend over 100 pounds per month, all your UK calls are free. Everything. 0800, 0845, everything. For as long as you like.

- At T-Mobile, we’ve implemented data traffic shaping. That’s a complex way of saying your Youtube clips load faster and in guaranteed higher quality than any other UK network.

- At T-Mobile, we’ve implemented a special priority data access plan for our most enthusiastic data customers: £29 per month gets you priority access on every one of our cell sites. So you’ll always be first.

- At T-Mobile, we’ve worked heavily to protect your privacy whilst online. Use our network and we’ll guarantee you’ll never be a victim of domain spoofing. Further more, if you buy or £2.99 option, we’ll also automatically firewall every mobile data connection you initiate. Which means you’ll be safer online.

- At T-Mobile, we worry about the fundamentals: We have 28 people working 24/7 to make sure you will consistently get a better quality mobile phone signal, every time. No other network offers [some technology] to ensure your phone calls stay live. Which is why we’ll refund your basic service plan fee if you experience a dropped call in any given month that was caused by our own equipment (and not the sub-standard technology of our competitors — tunnels permitting)

- At T-Mobile, we’ve partnered with every leading venue, railway station and shopping mall to ensure you experience 100% connectivity when you need it most. Want more? Just £3 per month will ensure your calls are prioritised above our standard traffic. So you’ll never, ever see ‘network busy’ again.

- At T-Mobile, we’ve done a deal to put a satellite-connected transmitter/Femtocell on every train in the UK. You’ll always be connected.

- At T-Mobile, if you lose/damage your iPhone, we’ll replace it within 8 hours anywhere in the UK, completely free of charge. Provided you commit to a four year on-going service fee. And the next iPhone (5) will be free too. In fact if you commit to an on-going 5-year deal, every phone you’d like will be free of charge and you’ll qualify for a new one every year.

- At T-Mobile, we’ve configured our network so that if you have 3+ phones with us, you’ll be able to use the same number on each one. For calls and texts. Absolutely transparently. No one else in the UK can do this.

- At T-Mobile, we guarantee we have the fastest possible data connection to the internet. We have 12x 1 gigabyte connections into our four UK data centres. That’s five more than our leading competitor. Click here to see our live traffic register. We’re the UK’s biggest purchaser of bandwidth. No one, absolutely no one, is faster. (This would have me reaching for my wallet in milliseconds).

- At T-Mobile, we’ve integrated everything into one single point-and-click interface online. Everything. Geek? Good: You can do your own service provisioning right from our online control panel.

- At T-Mobile, we are always open. No questions. 24/7. Call us anytime and get us online via chat whenever you want. Period. We’re here to help.

I didn’t include visual voicemail in the list because, frankly… in my dream world we’d already got past that.

So what do you think? Is it time for a mobile operator that actually does some operating beyond the same boring, predictable services we’ve seen for the last 5 years?

Am I off my rocker? Or are you with me?

I’d very much welcome your perspective.

You’d have thought that as we are almost entering the year 2011, the UK mobile industry would have collectively got it’s act together regarding text donations.

Alas no.

This ad is currently running on Southwest Trains and is aiming to raise money for ‘Our Heroes’ — that is, the British Forces Foundation serving wounded troops.

The ad’s headline reads ‘Buy our heroes a drink’ and encourages people to text ‘heroes’ to the 70099 shortcode which will cost £3 plus a standard network message. A good headline. Start with the average cost of a pint (or at least the cost most of us would like a pint to be) and then the £3 donation sounds eminently reasonable.

The ad’s footnote points out that at least £2.67 of your £3.00 will go to the Foundation. The rest of the £0.33 goes to the networks and the service providers. Shame on them. It’s downright ridiculous that text donations aren’t subject to some kind of fixed nominal fee — 5p or something like that. 33p is simply crazy. It’s worse from Virgin Mobile though, as the ad points out: Virgin customers will see a full 75p of their £3.00 spunked up against the wall by their operator. I wonder if that’s because Virgin want their share along with whatever network they’re currently piggybacking on top of?

If you ever find yourself wondering why the industry is actually rather backward, text donations are a perfect example. Obviously if you’re donating to the Tsunami Appeal or anything high profile, the operators and the value chain will selflessly waive all fees. But in the cold light of day, anything that’s unlikely to attract mainstream media attention is whacked for it’s pound of flesh by each player — from the operator to the various service providers involved.

There are excuses galore. It’s quite costly to manage the whole billing and collections. We have to pay for the equipment. We have to fund our connection costs. All that jazz. It doesn’t wash. It never has.

Another year goes by. Nothing changes. Highly disappointing.

If you do get the oppportunity to donate a few quid to Our Boys (and Girls) in the Services and, er, of course, the mobile industry, text ‘Heroes’ to 70099. I’ve just done so. (Spend it wisely, Vodafone.)

Update: See the comments below from Chris that points out Vodafone takes zero cut (good man, Vodafone), o2 takes a flat 3.1p per message, whilst the rest of the operators still demand a huge chunk.

Good morning from the Costa Coffee at London Heathrow’s Terminal 5. That’s me back in London now. I spent most of my time in Hong Kong this week doing interviews so I hardly had any time to look at anything else.

I did manage to briefly laugh-out-loud at the suggestions by some serious people in the mobile operator sphere that service providers such as Google, Apple, Yahoo and Facebook should help contribute toward the costs of maintaining their networks.

If you missed the reports, The Telegraph has a nice write-up.

In the piece, the top chaps at Telecom Italia and France Telecom — seriously, I kid you not — went on record. Here’s one of the quotes:

And now telecoms operators want the companies behind these devices to contribute towards the upkeep and improvement of the mobile network.

“Service providers are flooding networks with no incentive [to limit bandwidth],” Stephane Richard, chief executive of France Telecom, told Bloomberg. “It’s necessary to put in place a system of payments by service providers as a function of their use.

Utterly preposterous.

The reason there’s demand for the data in the first place is, in large part, due to these service providers. Facebook has done more to sell mobile data plans than almost anything else in recent years.

It gets worse, though. Are you ready for a statement about just how misguided these old beans in the mobile operator space are?

Here’s another quote, this time from Telefonica.

And Cesar Alierta, chief executive of Telefonica, complained that companies such as Google and Yahoo! used his company’s networks for free, “which is good news for them and a tragedy for us”.

Cesar, you should be ashamed of yourselves.

“Use our networks for free” — you what?

What do you mean *they* use them for free? What about the consumer who’s actually typing in ‘google.com’ into their handset and accessing the service using a data plan for which they’ve paid you good money?

It’s this kind of backward, looney, highly misguided thinking that I simply cannot stand.

How about this for a solution? Why don’t we take Facebook, Google, Yahoo, MSN and every Apple service, and let’s stick it into it’s own private MNO. Right? Those services for which these geniuses are moaning about, let’s put them behind a firewall and make them only available to the subscribers of this new mobile operator.

What do you think the consumer will do?

It’s pant-wettingly stupidly obvious.

Indeed, if you’d like to see just how bad the mobile operator dynamic really is, all we need to do is announce the iPhone 5′s general availability and make it clear that it’s only available on Network X, Apple’s new Mobile Network Operator.

The consumer would migrate in a flash.

The consumer isn’t using Telefonica.com to search. No. They’re using Google, because the company has invested billions to make sure the service is pretty sweet. Likewise, they’re not using TelefonicaBook are they? No, they’re using Facebook. Because of the value Facebook offers them.

Bleating about the network demand is highly traditional, though.

It’s not solving a problem, is it? No. It’s not looking at the underling issues and innovating the problems away is it? No. It’s lazy — and I find it downright offensive.

Of course all-you-can-eat data doesn’t necessarily work for all consumers, especially when you find that 80:20 rule (i.e. 20% of users are consuming 80% of available networking resources). I can’t stand it when I see a teenager sitting on a bus with his iPhone streaming — or attempting to stream — a 600mb file from BBC iPlayer or YouTube. Despite the phenomenally bad service, he’ll just keep on waiting for the buffering message to disappear, he’ll watch 10 seconds. Then wait for another 30 seconds while the buffering continues. And, of course, my simple web browsing speed is nailed because the local cell tower is having to deal with him, me and a few hundred others.

I don’t think limiting people to 500mb or 1,000mb is the answer at all. Nobody knows what this means. It’s a stupid yardstick introduced by a silly, silly marketplace as this post by Ben Smith outlines. Instead — as Ben points out — allocating people at network speed limitation would be far more useful.

Give the teenager 20k/second included in their standard network subscription fee.

Give me and Ben 500k/second if we stump up £15/month, more if we choose to pay you more. As Ben puts it, sell speed, not volume.

Then start getting smart.

I obviously use Google services on my mobile devices a lot. Tons of times every day. Likewise a host of other similar services.

Why not charge me for priority access to them?

Go and talk to Google, Telefonica. Ask them for a super-direct connection to one of their local geographic data centres. I’m sure Google would be delighted to peer directly with you, so that there’s no ‘internet’ cost. Put some fibre between the Telefonica hub and the Google data centre. Same for Facebook.  And then, charge for it.

Anyone who’s paying the standard fee, route them via the normal slow internet connection.

Anyone who’s paid for priority mobile internet access, route them via your super-dooper priority mobile data system. That will allow you to do some really funky data styling and management across your network, on a predictable and certain basis.

And now you’re really adding value to me as an end user. So sell me tiered access based on speed and then give me the option of a priority booster so that whenever I access google.com, I know it’s being delivered to me super-super fast.

Too complicated? To difficult? I saw some twitter discussion recently whereby some industry geniuses were pointing out that it’s “rather difficult” for mobile operators to manage their network delivery and that it’s “quite complicated” to deliver services such as dynamic tiering and so on.

Well that’s not a valid answer.

The mobile operator game has changed. Data is becoming increasingly relevant to the consumer, prompted by the explosion in services. So get with the programme, Mr Mobile Operator. Wake up. It’s not just about telephone calls and SMS. The value added service providers like Amdocs, Bridgewater and Nokia Siemens Networks are waiting for you. It’s time to invest heavily. But it’s also time to charge properly.

Consumers will pay for this. They’ll happily do so, provided they feel like they’re getting value. I can see a time where a consumer who’s paying a fiver a month for ‘slow’ data would choose to upgrade to medium or fast speed because it means (amongst other things) that they get Facebook quicker, faster, better. There’s a lot of education going to be required.

Blaming someone else because your customers are ‘using too much’ is crazy. Look closely at the underlying trends, recognise the world has changed and construct your billing plans and your network infrastructure accordingly.