Opinionated comments on mobile phone industry news
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Wednesday, January 24, 2007
The perfect mobile service
20070127: Now updated with more arguments. You might not agree, so I'd be interested in hearing from people in the business that have either succeeded or failed with different setups.
Here are some criteria I thought up for the ideal mobile service, provided you are an independent service provider. The criteria for an operator would be slightly different.
•Completely operator independent
–As a service provider you don't care what operator is involved; rather you want to reach all people that might be interested in your service; the mobile network is just a pipe between you and the user
–The critical thing is then of course that you need to build a brand that reaches the users; if that's not on your agenda, partnering with operators makes sense, but locks out users
•Not relying on operator and device dependent functionality
–Same as above: Maximum reach; for e.g. a photo-blogging service obviously the phone needs to have a camera, but don't rely on seldom-implemented features (like GPS or network-dependent location methods), unless you address business users and can charge an arm and a leg per user
–To be an innovator you might have to rely on seldom-implemented features, provided there's a chance most phones will get those features within a reasonable time (within your survival time); that way getting ahead of future competition
•Revenue from a business-to-business setup, even if it's a consumer offering in the end
–The customer companies take the risk
–You get revenue from many customer companies, acting a not easily replaceable aggregator of a service they have hard to provide themselves, whether it's a backend or complete service
–Consumers normally don’t want to pay anything anyway
•Very broad appeal (ideally worldwide)
–Capacity scaling (when revenue is already pouring in from regional use) is less risky than developing the service in the first place; of course time is of the essence here; as the first comment says: if you provide a me-too service, then you better stay regional
•Central handling
–All done centrally, equipment- and personnel-wise
–All customer access is via remote means (Web, e-mail, phone)
The criteria for revenue might not apply if you, by Web 2.0 tradition/hype/lore, intend to lift a lot of money from investors and then exit through acquisition. As the market matures, less and less companies can rely on being acquired and instead need to build their own capital through a service that people want to pay for. Of course you could rely on advertizing if your volume is large enough, but I sense service providers underestimate the amount of visitors required to survive through advertizing alone.
Most mobile service providers go consumer, but I sense there's also a good deal of business to be done to corporate. At least they are more willing to pay for the services provided.
Here are some criteria I thought up for the ideal mobile service, provided you are an independent service provider. The criteria for an operator would be slightly different.
•Completely operator independent
–As a service provider you don't care what operator is involved; rather you want to reach all people that might be interested in your service; the mobile network is just a pipe between you and the user
–The critical thing is then of course that you need to build a brand that reaches the users; if that's not on your agenda, partnering with operators makes sense, but locks out users
•Not relying on operator and device dependent functionality
–Same as above: Maximum reach; for e.g. a photo-blogging service obviously the phone needs to have a camera, but don't rely on seldom-implemented features (like GPS or network-dependent location methods), unless you address business users and can charge an arm and a leg per user
–To be an innovator you might have to rely on seldom-implemented features, provided there's a chance most phones will get those features within a reasonable time (within your survival time); that way getting ahead of future competition
•Revenue from a business-to-business setup, even if it's a consumer offering in the end
–The customer companies take the risk
–You get revenue from many customer companies, acting a not easily replaceable aggregator of a service they have hard to provide themselves, whether it's a backend or complete service
–Consumers normally don’t want to pay anything anyway
•Very broad appeal (ideally worldwide)
–Capacity scaling (when revenue is already pouring in from regional use) is less risky than developing the service in the first place; of course time is of the essence here; as the first comment says: if you provide a me-too service, then you better stay regional
•Central handling
–All done centrally, equipment- and personnel-wise
–All customer access is via remote means (Web, e-mail, phone)
The criteria for revenue might not apply if you, by Web 2.0 tradition/hype/lore, intend to lift a lot of money from investors and then exit through acquisition. As the market matures, less and less companies can rely on being acquired and instead need to build their own capital through a service that people want to pay for. Of course you could rely on advertizing if your volume is large enough, but I sense service providers underestimate the amount of visitors required to survive through advertizing alone.
Most mobile service providers go consumer, but I sense there's also a good deal of business to be done to corporate. At least they are more willing to pay for the services provided.
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IMSPs (Independent Mobile Service Provider) have two major issues to deal with: marketing and billing.
And successful marketed does not guarantee you smooth revenue stream.
As an IMSP our service (http://www.mobileshortcut.com) did see users from all corners of the world, yet we now have to fall back to domestic focus for partnership with yellowpage, newspaper, book/mag publisher, telecom operator, and etc. for more realisitc revenue.
Reaching directly to end users with the expectation of building up a noticeable traffic volume and then translating it to acquisition or advertising, requires truely unique and strong service features from the IMSP. Unfortunately many niche features require download and installation on handset, plus the advanced implementation can become one step too early and not for too many handsets.
Then if IMSP goes for "me too" services, e.g. picture upload, mobile blog, etc., it becomes a marketing thing, a "deep pocket" thing, and it's more for the big guys like Yahoo, Google, at the end of the day.
I agree with your "Revenue from a business-to-business setup". It's better and safer to operate a two-tier service with business partners inbetween IMSP and the end users.
As the service infrastructure cost comes down further and further (HW, networking, storage) more IMSPs are joining the action. With no obvious new killer service in view, most of these new IMSPs will have to rely on some local root for viability.
And if there should be a new killer service come into public, "me too" guys will appear overnight, and the competition again falls from technology back to marketing. The sweetspot will be on the local market instead of the global one, if you're not Yahoo or Google.
- Metha
And successful marketed does not guarantee you smooth revenue stream.
As an IMSP our service (http://www.mobileshortcut.com) did see users from all corners of the world, yet we now have to fall back to domestic focus for partnership with yellowpage, newspaper, book/mag publisher, telecom operator, and etc. for more realisitc revenue.
Reaching directly to end users with the expectation of building up a noticeable traffic volume and then translating it to acquisition or advertising, requires truely unique and strong service features from the IMSP. Unfortunately many niche features require download and installation on handset, plus the advanced implementation can become one step too early and not for too many handsets.
Then if IMSP goes for "me too" services, e.g. picture upload, mobile blog, etc., it becomes a marketing thing, a "deep pocket" thing, and it's more for the big guys like Yahoo, Google, at the end of the day.
I agree with your "Revenue from a business-to-business setup". It's better and safer to operate a two-tier service with business partners inbetween IMSP and the end users.
As the service infrastructure cost comes down further and further (HW, networking, storage) more IMSPs are joining the action. With no obvious new killer service in view, most of these new IMSPs will have to rely on some local root for viability.
And if there should be a new killer service come into public, "me too" guys will appear overnight, and the competition again falls from technology back to marketing. The sweetspot will be on the local market instead of the global one, if you're not Yahoo or Google.
- Metha
You make some very valid points.
I'm investigating a service concept that at least locally would be completely unique. That was why I wrote the guidelines in the first place, to have something to check against :). Unfortunately my service doesn't fully comply at a few very critical points, so it will probably bomb...
Yes, you might be completely right about a local focus. E.g. I've seen MySpace-like services be very successful locally despite MySpace (e.g. in Sweden it's Lunarstorm, that's got more than 10% of the population as members), because they are in the local language, have complementary services with a local touch, etc. Also, even advertizing might be more effective, as the advertizers want to reach an audience that's likely to buy (or at least likely to like) what they promote.
I'm investigating a service concept that at least locally would be completely unique. That was why I wrote the guidelines in the first place, to have something to check against :). Unfortunately my service doesn't fully comply at a few very critical points, so it will probably bomb...
Yes, you might be completely right about a local focus. E.g. I've seen MySpace-like services be very successful locally despite MySpace (e.g. in Sweden it's Lunarstorm, that's got more than 10% of the population as members), because they are in the local language, have complementary services with a local touch, etc. Also, even advertizing might be more effective, as the advertizers want to reach an audience that's likely to buy (or at least likely to like) what they promote.
Hi there Anders, you're on this week's carnival of the mobilists.
http://www.mobbu.com/Blog/31/carnival-of-the-mobilists
http://www.mobbu.com/Blog/31/carnival-of-the-mobilists
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