Operators need to partner with developers to innovate faster. Mobile application revenue is growing rapidly and will reach $6 billion by 2013. Customers now expect constant innovation from their service providers similar to web-based companies. If operators do not act now to develop applications that utilize their networks, they risk becoming just a "dumb pipe" utility provider.

1. Why Operators Need Developers
Alan Quayle
Business and Service Development
www.alanquayle.com/blog
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© 2008 Alan Quayle

2. Mobile Application Revenue could reach $6B by
2013, 2008 is was $118M (US), $240M (Global)
Broader Mobile Data Revenue breakdown by
type of service, 2008-2014
Source: Pyramid Research Mobile Data Forecasts, Q1 2009
$6B Mobile application revenue is part of broader $46B mobile data
revenue opportunity by 2013
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© 2008 Alan Quayle

3. Re-engineering the Web
Era Date Characteristic Access Operator Implications
Development of the <100kbps Focus on infrastructure,
Web 1.0 ’90-’05 capacity expansion and mass
basic platform.
market connectivity.
Focus on user Partner with media
experience, open <10Mbps companies, social networking,
Web 2.0 ’00-’10 programmable systems, advertising based models, IP
connecting people. control and QoS.
Web becomes intelligent, Fundamental shift in business
understand / anticipates <100Mbps model, dumb or smart pipe?
Web 3.0 ’10-’20 users needs – rise of the Question mark of operators’
‘trusted agent.’ role as ‘trusted agent.’
Can Operators become the Trusted Agent?
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© 2008 Alan Quayle

4. Power of Devices drives Peer to Peer
Assumptions Shattered
Always Online Intelligently Connected
Faster CPUs, 3D graphics
Multiple PDP context Push as well as pull
Massive storage
Multiple access Pervasive P2P
High definition displays
Application driven Smart UIs
Media centric
Web-centric Context aware
Smartphone penetration >50%
Intelligence is now also at the edge
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© 2008 Alan Quayle

5. Customer’s Perceptions are Changing
User doesn’t care if Applications are no
message delivered longer ‘web’ or
Other
by SMS, MMS, IM Voice ‘telecom’ services –
or email. they’re just apps.
Utility
Messaging
Subscribers are no Productivity
longer ‘voice
Mobile broadband
subscribers,’ PIM starts to substitute
they’re Internet
fixed broadband
subscribers – voice
is just an app.
Games
Access to
Source: Nokia Browsing Multimedia
multimedia is no
Smartphone 360 Survey
Time allocated to
longer constrained
different applications by the network
Voice makes up an increasingly small percentage of a smartphone’s
usage, critical to embed such capabilities into other apps/processes
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© 2008 Alan Quayle

6. Web-based Service Providers are Innovating Faster
in Service Providers Core Business
And customers now expect this rate of innovation from their service
providers
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© 2008 Alan Quayle

7. Which means that…..
Fixed and mobile Services independent of Rapid usage growth and
Broadband is an enabler the network innovation
•Broadband is the •Broadband is an •Growth of Web 2.0
growth engine for enablers for all services community services
telecom. •Market boundaries •“Freemium” models
•Increasing access diminish as customers •‘Boiling Frog’
capacity increases expectations change. expansion into voice
web-service •Move from vertically to
capabilities horizontally integrated
•Web 2.0 start to cannibalize telco’s services
•Voice, messaging, IPTV
•Multi-play becomes multi-access
Operators must act now or become a dumb pipe
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© 2008 Alan Quayle

8. Why Operators are Deploying SDPs
Access & Intelligent Wholesale
Applications Content
Distribution Connectivity Brokering
Utility access where
Bit Pipe differentiation is price and
network quality.
Open access, controlled
and monetized QoS, Billing,
Smart Pipe Data Mining, Capability
Wholesale, Ad Broker
Content and Service Provider
There will be no clear cut between the different scenarios, multiple
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business models and revenue modules will co-exist.
© 2008 Alan Quayle

9. An Operator’s Product Development Process
Find Budget
Opportunity Market
Identified Research
18-30 month 12-18 month
s s
New product
Re-Launch Launch development process
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© 2008 Alan Quayle

10. What’s Changed?
Expectations
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© 2008 Alan Quayle

11. What customers expect
18-30 month 6-12 months
s
4 months Weekly
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© 2008 Alan Quayle

12. High Street Subsidized Network
Phones Control
S to r e s
Customer
Relationship
Ecosystem Billing
Control Relationship
Brand
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© 2008 Alan Quayle

13. Operators Service Innovation Process is Broken
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© 2008 Alan Quayle

14. We’ve been talking about it for over a decade,
but now its the customer that’s going to decide
Utility Service
Connectivity Provider
Operators need Applications…. using their
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© 2008 Alan Quayle