Category Archives: mobile commerce

HTC Droid Incredible – The Rest of the Story (Spoiler Alert!)

What Droid Incredible Really Does – and Does Not (Unofficial Review)

After resisting Droid-Rage during the holiday season, I succumbed to the uber- hyped latest Android super phone – the HTC Incredible.  My venerable Blackberry Curve just was not as sleek or sexy and clearly did not have the cool robot graphics.

There are numerous blog reviews and YouTube videos that will espouse all the virtues of Verizon’s number 1 smartphone.  While they are largely correct, they do not tell the whole story.  Yes it is fast, works on a great network, has more features that a human can possibly comprehend, or use – and even makes phone calls.   I will provide another article with my fav Droid features – this article is about the other side.

To quote Paul Harvey  – “And now the rest of the story….”  Here are my top six issues with my Droid.

1. Speed comes at a cost – The Achilles Heal of the Incredible

All the blazing application response and connectivity comes at a cost in battery utilization.  The first day I had my Droid I had to charge it 2 times.  What good is all that capability if the phone is dead?  If you get a Droid you must stay close to a charging source and become an active energy manager.  You should turn-off the GPS when not needed, limit the number of running applications and even re-consider all of those really cool active widgets which use periodic connectivity to update themselves.   If you need an icon of the sun to let you know its sunny outside, perhaps you need more than a new phone.

2. The display rocks – unless you want to use it outside during the day

The AMOLED technology used in the HTC screen is the latest, but not quite the greatest.  The display is great when used inside.  I just got back from a round of golf and the phone was practically unusable in the sunlight.  The bigger issue is using the super Google driving directions app with a map view.  The map will not be viewable in a car during the day!

3. Its not the number of Apps that matters – its having the right ones and ones that actually work

I never got that impressed with the claims of absolute number of apps on device platforms.  If the iPhone has 300K and the Android 30K , what does that really mean?  It’s a little like counting the number of Nukes that the U.S. and Russia have in their arsenals. .  Quality, not quantity really matters. Android has the basic Facebook and Skype apps.  Its the other 30K that may need some help.  My impression is that the apps on the iPhone are not just more numerous, but are generally of higher quality.   Perhaps the Android platform chased absolute numbers to claim lots of apps without as much quality consideration.  Several apps just did not work at all and others just stopped working.  I tried to download the linkedIn app and had a failure.  This is an area that the Android platform will likely get right at some point.

I want quality apps for the handful I will actually use.  Android has to close the app quality gap with Apple.

4. iTunes Integration – Music and Video – ???

The iPhone clearly excels at music and video desktop integration.  The challenge for any other platform is to create seamless integration for their platforms with the defacto standard for online music. Given the critical nature of this feature, one might assume that HTC or Verizon would provide a solution that makes this happen.

And you would assume wrong.  There are a couple of solutions that purported to achieve this function.  I tried both SailingMedia and DoubleTwist.  Both of these third-party solutions did not work.  While I could probably play with them for another hour or so and figure out what the issue is – why should I have to do that?  I did load my music directly by dragging my music to the mp3 folder on my device.  The music plays fine and the external speaker is loud –if that matters to you.  There does not appear to be a pre-loaded video player and I have yet to get a video, other than YouTube to play successfully.  Again, I’m sure I will figure it out – but why should I have to?

5. Gmail Good – Gmail Bad

I use gmail for my personal email domain, I figured that the Android platform would be a good choice for my use.  For the record my Blackberry worked perfectly with my gmail account.  As expected my gmail account integrated easily with my Droid.  My issue with email is the rather poor gmail app on the device.  I tried to use the HTC mail app and for whatever reason it does not seem to work when my gmail application is active.  As with my other issues, I am sure with a little time I can get it to work.

6. Steve Jobs is right – One button is enough

The Incredible Droid has 7 physical buttons -Home, Menu, Back, Search, optical trackball with click, volume and power/wake-up.  In addition to these physical inputs the standard screen has four soft keys – an up arrow to access all programs, a phone button (yes it can make a phone call!), a “+” key for adding widgets, programs and folders to a screen, and lastly a hidden slide down at the top of the screen that gives a list of alerts and running programs.  Wow – that’s a lot of things to keep straight!.  The really annoying input is the totally useless optical track ball and click selector that just happens to occupy the same spot as the single “home” key on the iPhone.  Needless to say, I have been pushing that click selector by accident through pure muscle memory from my iPhone and iTouch.  An optical trackball on a touch screen device?  Why?

Despite these issues, I am sure I will get around the downsides of this device and make it into a very useful tool for business and personal use.  However, how many customers will take the time to become an I.T. manager for their phone?

For the past several years I carried my Blackberry for phone use and light Internet use and an iTouch for fun.  The true test will be if I go to one device.

The iPhone, like all Apple products – just works out of the box.  The Droid can work, and even do more, but you have to know what you are doing and be willing to investigate the necessary solutions.  The Droid is clearly still rough around the edges.

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Filed under Apple, Droid, HTC, Incredible, Incredible, iPad, iphone, Ipod, iTunes, mobile, Mobile Application Stores, mobile commerce, skype, smart phone, Smartphone, Social Media, Steve Jobs, Verizon, wireless

Appvertainment from Jobs-Apple and the iAd

The announcement of iPhone OS4 changes the Smartphone  world – yet again.  As Steve Jobs described the 7 tent poles of the new iPhone/iTouch/Ipad OS, it was clear that the tent was not quite large enough for everyone. The center pole of this tent is clearly– iAds.

The raison-d’etre  for the much heralded multi-tasking feature is Appvertainment.  (e.g. iAds).    Do not be distracted by the fact that he introduced multi-tasking first and iAds last.  They are intimately linked.

Apple is pursuing their app centric  vs. search (Apple vs. Google) strategy for smartphones  through the introduction of their own OS integrated  ad serving technology.  Multi-tasking is the key component in this ad strategy to permit a user to return to an app after an ADHD moment is fulfilled by playing with a cool appvertainment.  Without multitasking you lose your application state/status and have to start over again.  Jobs is trying to change user behavior and reward users for clicking on an ad with an engaging experience, instead of punishing them by having them have to re-start their app.

Appvertainment targeting was not discussed. The social  and geolocation information that the host apps maintain on users will most likely be used for targeting purposes.  The Apple social game network API will no doubt  be used for providing this targeting information for game hosted appvertainments .    Apple is betting that App hosted ads will be valuable than Internet style search ads.

Jobs boosted that the Apple platforms would be capable of serving 1 billion app-ads per day by the summer of 2010.  Even if we cut that number in half and apply a modest $10/CPM ad rate – that represents daily gross appvertainment revenue of  $5M.  Apple’s vig on the ad revenue is 40%.  This is easily approaching a $1B+ annual revenue opportunity for Apple.

Click for full commercial

Another interesting aspect of this strategy is that Apple is clearly focusing on large brands and advertising agencies – in other words, the folks with the largest budgets.   This clearly makes sense.  The cost of an appvertainment production can easily be in excess of $250K+.  The inclusion of integrated and compelling video with engaging interactivity is not the domain of amateurs, but rather professional digital agencies.  The examples that Jobs demonstrated during his presentation (Nike, Disney and Target) are all major national brands with large budgets and big Madison Avenue agencies.

As I watched the presentation another thought came to mind –  “Is this legal?”  What would happen if Microsoft integrated a proprietary ad serving system in their OS and demanded 40% of the revenue of every ad served on a Windows machine?  This topic will clearly be discussed in the blogosphere and perhaps courtrooms in the future.

Did anyone hear a mention of sharing ad revenue with Mobile Carriers?

Another  “pole” of significance is the enhanced suite of enterprise features. Corporate CIOs have had a set of killer issues that prohibited the iPhone from significant corporate sanctioned and supported utilization.  Apple is trying to remove these roadblocks with OS4.  In addition to the enhanced  security and email capabilities is device management.  Device management includes the feature of permitting corporations to load their own private apps on the iPhone.    The execs at RIM should be concerned about their Blackberry franchise.

Apple would not be investing in enterprise features while maintaining an exclusive relationship with AT&T.  OS4 changes Apple from the Trojan Horse of a sexy consumer device on AT&T to a machine poised for world domination.

The competition between Google and their Android platform and Apple will only get fiercer.  Nokia is the only other global player who can play at this level.   Palm, RIM and even Microsoft will fight for the leftover niches.  It is a battle of the controlled and planed eco-system of Apple vs. the Open-Source world of Android.

The Apple tent has room for enterprise applications, has a new revenue source for app developers, and embraces big brands, ad agencies and publishers.  Adobe (no Flash support) and Google are outside the tent of OS4.  Microsoft got the biggest slight in this announcement as their mobile efforts were ignored as though not relevant.  And what about the mobile carriers?  Do they exist in the Apple world? Continue reading

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Filed under advertising, android, Apple, AT&T, Beezag, blackberry, facebook, Google, iPad, iphone, Ipod, iTunes, location based services, management, microsoft, mobile, mobile advertising, Mobile Application Stores, mobile commerce, mobile games, netbooks, new media, Newspapers, Open Network, opensource, pirates, smart phone, Smartphone, Social Media, social networking, Steve Jobs, Twitter, Web2.0, widgets, wireless

Kudos to Verizon for taking on Leadership – Mobile without Phone Numbers

Approximately one year ago I wrote an article entitled “The Future of Mobile – without phone numbers.” In my discussion I put forth the proposition that social networks would take over the fundamental connectivity for individuals and that phone numbers would be a network “IP address”.   This article generated 100’s of emails and questions, some supportive, some not, but all thought provoking. It was clear that I had hit a nerve.

A major step towards my view of the future of mobile communications was taken by Verizon in the last week.  Verizon Announced at the Mobile World Congress in Barcelona, and later confirmed and launched at CTIA 2010, an integrated Skype calling service.  This service enables users to click any Skype username, make a call, and not be charged for mobile minutes.  This service even uses the mobile voice connectivity of Verizon for the wireless network of the call.

This is a major watershed event for the industry.  A major carrier embracing voice as a data service, with calls completed outside of the carrier’s equivalent phone number – DNS.

In fact, this capability had been  available by such applications as ISkoot.  What is big news is that Verizon is openly promoting this service and not charging for mobile minutes.   Another advantage of the Verizon version is that it is “always-on”.  I received my first Skype call on my mobile yesterday.  It just happened like any other mobile call.  It was an important business call and all I could think about at the conclusion was – that was cool.

The use of social networks and non-phone number connection services implies that that contact DNS aggregation services will become even more important.  My network contact list will be an amalgamation of my Facebook, Linkedin, Skype, Twitter,  existing phone books, AOL IM list and likely several others.  Aggregating my contact lists, storing them in the network cloud and presenting them to me on demand in a usable form is essential.

While at CTIA I was on a panel discussion with   Mike Mulica, CEO of FusionOne.  FusionOne is a leading example of such a network based contact/address book that spans social networks.  They are certainly a company worth watching in the future, as they appear to be “on the right side of the technology curve”.

A question that remains is how does Verizon generate revenue by connecting calls for free?  Simple answers include increased data subscriptions and greater subscriber growth via churn from other carriers.    In the U.S. market, with mobile penetration approaching 90%, carriers can only increase subscribers by churning their competitor’s customers.   Since the Skype app on iPhone is not as full featured and cannot be “always-on”, VZW has given leading edge users a reason to switch NOW.

In the future I would expect connections between Skype calling capability and other applications on Verizon, especially those provided through the Verizon’s own app store.  I also expect that full mobile video calling and even video conferencing via Skype is no doubt on the roadmap.

This feature is only available to VZW smartphone subscribers , and that means a $29.99/mo data charge.

Regardless of the long term revenue sources, VZW has taken a clear leadership position in its market and now has the their competitors determining a catch-up strategy.  Kudos to Verizon on this move.

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Filed under Acquisitions, advertising, android, Apple, AT&T, cloud computing, CTIA, facebook, FusionOne, iphone, location based services, MAc, mobile, mobile advertising, Mobile Application Stores, mobile commerce, portal, skype, smart phone, Smartphone, Twitter, Verizon, Web2.0, widgets, wireless

Marketing is about choices – or is it? You decide

Marketing is about choices – or is it?

I recently went through a mental exercise of trying to determine what makes great marketing companies…. well…. great.   There are the obvious, and historic , iconic brands of the last 100 years – Coke,  Ford, AT&T,  McDonalds, Bud,  Chevy.  These brands have become part of the American DNA.  They will not necessarily be the great marketing giants of the next 20 years, but like that old pair of jeans, somewhat comfortable,  but  not what you will brag to your friends about.


None of these companies excelled at consumer choice.  Coke gives you with/without caffeine and  with/without sugar .  Ford and Chevy have nearly gone out of business by trying to offer too many choices, or more correctly, dictating what the consumer should choose.  Bud gives you regular or lite.  McDonalds is about the burger.  These companies have used massive advertising to direct the consumer choice to their pre-determined, limited set of options.


The companies that are dominating consumer choices now are Google, Apple, Facebook, Your Cable/Internet Providers, and Amazon.com.   They all seemingly put choice back in the hands of the consumer.  Google presents you with literally whatever you want.   Apple provides endless apps on the first really open smartphone.  Facebook opens a world of new and past friends and lets you choose who you want to be friends with, or not.   Cable television began to break up the monopoly of the networks by providing consumers 100’s (and now 1000’s) of channels of choice, coupled with video on demand.   In this era of consumer empowerment, does brand matter?


The conclusion I came to is yes , and now more than ever.  Fundamentally, marketing is about directing a consumers choice to a specific product or service.  Google only makes money when you choose to click on a product search that was highlighted via advertising.  Apple needs you to choose their marketplace for apps.  With thousands upon thousands of apps, what will be the mechanism for consumer adoption?  The featured list of apps on the iphone is really what? It is a mechanism to show you that you have unlimited choice , but then direct your choice in a specific manner.     Facebook is a huge social marketing machine that tries to influence your choices by having your friends influence you.  Influence the Influencers, and you direct choices.

Your Cable providers can offer you 100’s of channels, and as has been seen in recent days, can take those channels away.  They do however; seem to come the closest to providing relatively influence free choices. (Their advertising for paid VOD movies aside).


Amazon provides a brilliant mix of peer reviews and product recommendations.  They are really the more direct version of Google.  Search on what you want to buy, get a couple of choices.  If you don’t like what you see, they suggest close alternatives. While their marketing value proposition is about unlimited choice, their technology is all about limiting your choice, so that you will make a choice.


So, the older model had a marketing organization pre-determining a consumer’s choice through some form of market research and then marketing the heck out of those choices.  Now, companies give the illusion of unlimited choices, monitor and track the actual choices that are made and then capitalize on those choices and utilize more subtle earns to influence those choices.


Marketing is marketing.  The techniques evolve, but the goals remain the same.  Buy my product or service and not the other guys.

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Filed under advertising, Apple, E-Commerce, economy, facebook, mobile advertising, Mobile Application Stores, mobile commerce, smart phone, Smartphone, Social Media, social networking

Google clicks in for Mobile

googleDuring the past week Google made two significant splashes in the mobile arena. Their much heralded, bombing of middle America with Stealth fighters announced the landing of the “Droid” mobile device. Secondly, their acquisition of the leading U.S. mobile advertising company, Admob for $750M announced the full legitimacy of mobile advertising. When Google speadmobaks, the rest of the industry should listen.

There was a time, not too long ago, when an entire industry seemed to get a simultaneous epiphany – that the Internet had created a legitimate “second” screen to television.  When this became “conventional wisdom”, the advertising Dollars, Euros and Yen started to shift from the “spray and pray” methods of television to the increasingly targeted methodologies of the web.

The same thought process can now be safely referred to as “conventional wisdom” for mobile.  The consumer is spending more time starring at their mobile screen, and less and less at their Web browsers, and even far less in front of the television.  With this reality, the web advertising giant is shifting more investment to the third screen  – which we should refer to as the consumers prime screen, the mobile screen.

We have transitioned from TV ad blindness (really a Pavlovian queue to go to the frig or bathroom), to web banner blindness.  We now, however, have the personal medium of the smartphone to reach consumers.

We have moved from the communal family device, the television, to a shared, yet personal device, the PC to the personal and un-shared device, the smartphone.

There will be some winners and losers in this new reality.  The winners will be companies that have invested ahead of the curve and have developed mobile and true multimodal next gen advertising vehicles.   Advertising and promotional technologies and processes that have broken with the “spray and pray” techniques of the past and capitalize on the true personal 1-1 advertising techniques, providing consumers ads that they want to view, will be the market winners.

The Android has positioned Google to be in your pocket, not figuratively, but literally.  The combined promotion with VZW and Moto, with stealth bombers creating a thinly veiled a sense of “Shock and Awe”, is a loud statement.

(Note to the Droid ad agency – Stealth bombers do not fly during the day, hence the word “stealth”)

See my other comments on the ad campaign at the end of this blog article.

VZW is a company with a great network and a lagging device lineup. Moto has raw engineering and production talent for mobile devices and has largely fallen off the radar screen in recent years.  Google, the dominant player in the present  generation of Internet advertising, is seeking to maintain and grow that position in the next generation.

So, Google is playing a pre-emptive attack strategy in mobile. VZW is playing catch-up to the iPhone.  Moto is, perhaps, playing their last “bet the company” card on Android technology.  Offense, defense and survival makes for three very motivated partners.

With the expected proliferation of Droids and other smartphones, Google’s purchase of ADMob is both stunning and obvious.   Another winner in this market shift will be, as I have written about in the past, the major social networks.

So who are the losers this past week?

On the Wireless Carrier side of the equation, Sprint and T-Mobile have to be concerned.  The gap between them and the leaders  (AT&T and VZW) is widening.   I  expect one less mobile service company in the U.S. in the next 12 months.

The emergence of Android platforms is likely the end of Palm as a mobile platform.  The Palm Pre never got the consumers attention and thus critical market share.

Too little, too late.

Palm will not be able to compete with Google and Apple in this round.  Their demise is written on the wall (in Graffiti).

500x_smartphonemarkshareRIM also has to be very concerned.  The launch of their touch screen device, the Storm was, well, stormy.   Blackberry has a strong market position and is well entrenched.  It has made significant growth in the consumer segment in recent years.  Will that growth reverse with maturing Android devices?  While Blackberry is in a much stronger position than Palm, the combined investment potential and application resources of Apple and Google will be a major challenge to RIM’s Blackberry.

All that said, RIM still commands over 20% global share in smartphones

Application developers will have to start to prioritize their porting and promotion of new applications between four major global platforms – Symbian,  Blackberry, Apple and Android.

It will be interesting to watch the global leader in the smartphone category – Nokia and their Symbian Operating System.  This platform is relatively unknown in the U.S. market, but is dominate in the rest of the world.

The next obvious question is how do these moves motivate other players in the industry to react?  Microsoft is desperately playing catch-up to Google in present generation search engines and advertising.  Their own version of a mobile operating system has made, at best, niche inroads.  Microsoft has suffered from execution issues and seems to be the biggest example of true  “innovators dilemma” in the last 20 years.

Yahoo has some mobile applications but seems to be a company unable to focus the attention necessary on any one initiative.  Perhaps some Corporate Ritalin is in order?

My conclusion is that both Microsoft and Yahoo will likely go shopping for a focused next gen advertising company.

Ad Agencies that have largely focused on managing creative production and bulk television ad buying are increasingly on the wrong side of the technology curve.  They are, however, in a good position with the depth of their industry relationships, to be a major force in the next wave of Internet/Mobile advertising,. The question is are they willing to move from their existing business models and develop the expertise in the methodologies, either in-house or through acquisition that can maintain their market positions in the value chain for the next generation.

The technology of smartphones, advertising and applications has now combined to make the next generation of consumer services and commerce a break from the past.  At least that’s what I hear from all of the “Conventional Wisdom”.

Notes on Droid Ad Campaign:

The more I thought about the Android “Stealth Fighter” ads the more I realized that that imagery was quite familiar.  I have added four additional videos for your viewing.  Theses video are the trailers for the 1953 and 2005 versions of “War of the Worlds” , the trailer for Armageddon and CNN footage of the bombing of Baghdad.

With these videos you can draw your own conclusions.  Please let me know what you think.

In my opinion, these images all have some resemblance to the Droid commercial.  In each of these cases the situation did not end well for the “entrenched” establishment.  Mass destruction was the result.  In one case a virus saved mankind.  This is hardly the message that a smartphone operating system might want to promote.    The droid-like figures eventually emerge to destroy everything in sight –they really do – you can Google it.  In the CNN footage a nation watched mesmerized by the imagery, only to learn that perhaps the wrong war was fought.

All interesting imagery for the first shot in a new generation of smartphones.

Subtle – this is not.

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Filed under Acquisitions, advertising, android, Apple, facebook, Google, mobile, mobile advertising, Mobile Application Stores, mobile commerce, smart phone, Smartphone, Social Media, Twitter, Web2.0, wireless, You Tube

Going Off (Portal) in Vegas

lasvegassignNext week I will be attending my 25th CTIA conference. This year’s Vegas show will occur with the twin backdrops of the overall economic mess coupled with the positive trends in mobile application use.

On Thursday April 21, I will be on a panel discussing the Off-Portal business models. The irony is that although I have made a living for the past several years in the Off-Portal marketplace, I believe that this model is not relevant to the future. Let me explain.

For those who are not familiar with the lingo for this segment of the mobile business, let me define a few terms. (If you know all of this you should skip down)

Mobile Carrier Portal – This is the homepage on a handset of a carrier’s wireless Internet service. The carrier determines what services are promoted and placed on the portal. verizontodayh4webThis is also referred to as “on-deck” or “on-portal”

Off Portal – This is any service that is available to the subscribers of a carrier that is not linked to the carrier owned homepage and direct links. This service is usually promoted through use of a shortcode.

Shortcode- a five or six digit number that is used to provide information or other services via SMS

Premium Shortcode – A five or six digit number that is connected to a service that the subscriber will pay a one time or monthly payment.

The mobile value added service market has been divided for the past 5 years between “on-deck” providers and “off-portal” service. The services were predominately information and news services, coupled with fee based ringtone, wallpaper and games services. The advantage of being an on-deck provider was free promotion for your service by being within the captive (or semi-captive) carrier internet web service.

Alternatively, off-portal services were promoted with a mix of traditional web advertising and search engine optimization, coupled with television, radio and print. The off-portal application and content providers also promoted their services via premium shortcodes. To use an off-portal service the subscriber sends a message such as “join” to the code, goes through an opt-in process and gets subscribed to a service such as monthly ringtones. The billing of these services is provided by the carrier.

It seems that regardless of a company’s portal status, they had envy for the other model. On-deck providers wanted the “freedom” to promote their services and drive even greater traffic to their site, while off-portal services desired the free promotion model of the on-deck players.

ovistoreThis game is largely over. Just as the original AOL closed portal gave way to the general Internet, the protected closed gardens of the carriers are done. If their portals are “done”, then off-portal, as a concept is done.

The explosion of smart phones with powerful standard browsers, large screens, pointing devices and keyboards renders a pre-installed carrier bookmark almost valueless.

If you have a fee based service that is on a carrier’s portal, you will have to promote that service with investment that will eventually approach the advertising investment of the off-portal services. This trend is further accelerated by the 3rd party application store trend.

The application stores are filling the promotion void created by the reduction of prominence of the carrier portals.

So on Thursday I will sit on a panel to discuss the challenges and opportunities of the off-portal business model. This business model has made 100’s of millions of dollars for application and content providers and, of course, the carriers.

My opening comment will be that this model is in its end days.

My next article will be on what a carriers and application providers should do to manage this transition.

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Filed under android, Apple, economy, mobile, Mobile Application Stores, mobile commerce, mobile games, Open Network, Ringtones, shorcode, Smartphone, subscription servcies, syndication, Verizon, wireless

Cheers and Jeers for Mobile without Numbers

My article “The Future of Mobile – without numbers” created a large reaction.  I received a full inbox worth of cheers and jeers.  For those who cheered, I say “thanks.”

comedy-tragedy-maskFor those who jeered, I say, “Thank you very much!”  I have always believed that when people challenge your thinking and your logic, you have the opportunity to learn and make your own arguments better.  With this in mind, I have created a couple of broad categories of challenges from my critics.   (If you have not read the original article you should first check it out with this link)

 These areas are:

1-The sociological, technological and economic feasibility of my hypothesis that social networking and VoIP will fundamentally change the mobile industry

2-What should the Wireless Service Providers do to counter this threat?

Item 1:

To explain and expand on my logic more fully it is useful to look at some history.

What was the key invention that made the Internet a global phenomenon?

It was not TCP/IP, or browsers or even Google.

barilan_internet-thumbThe key invention was the Domain Name Server (DNS).  DNS translates a domain name to an IP addresses.   It is much easier to remember www.nytimes.com, instead of its IP address (170.149.173.130).  DNS servers are continuously updated around the globe as Internet services switch IP addresses; add new destinations or new web services are created.

DNS is also what makes email possible.

Prior to global DNS services the translation of a name to an IP address took place (if at all) in the equivalent of a local address book on your computer.  You would update this local file with new IP address/Web name pairs as you discovered them, with the obvious problem that your local address book did not automatically update to track changes.

 Does this sound familiar?        

For nearly 100 years telephone services have been in the local address book mode.  As a telephone subscriber, the implied requirement was for you to carry your own version of a local DNS in your pocket. Antique telephoneYour phone contacts would only update if you physically made a change to your address book.

The phone company would issue all subscribers a regional, printed, version of DNS on a yearly basis, the big phone book.

This fundamental use case did not change until the introduction of phones with imbedded contact lists.  With embedded contact lists you could scroll through a list and click to call.  This feature eliminated the need to dial or punch all the digits yourself, but was still limited to your personal updates.

Prior to the ability to look up and retrieve phone numbers for people and businesses on the Internet, the only global DNS equivalent for telephone service was “411”, information service.

The use case for smartphones is the start of a fundamental change.  With their larger screens and easy keyboard entry, you just type the name of the person you want to call and press send.  The connection with the phone number is further eroded.  The contact list still, however, must be maintained personally, just like our Grandparents did with their paper versions.

I can still remember the phone numbers from my friends in high school, but have to look up my kids’ numbers.  The reason is that I never use my kids’ numbers; I just type their name.

The ability to take your phone number with you when you change providers (landline or wireless) was a big boost to the manual updating of address books.  This was made necessary because of the lack of Global DNS in telephone service.

The emergence of large, ubiquitous social networks is the final missing puzzle piece that will finally alter this 100-year pattern and make phone calling similar to typing “nytimes”, instead of its IP number.  These social networks provide several key elements.

They are a collection of your friends, family members and business associates.  Your network(s) contain the majority of people you need, or want, to communicate with on a regular basis.

fhw1uoifmega5hwmediumSecondly, your networked friends should give you permission to view and have access to their actual phone numbers.  This access will give you the equivalent of global DNS for your contact list!  The updating of the phone numbers will no longer be your responsibility, but the responsibility of your friends.  This is the same scenario as a Webmaster updating their web services IP address for DNS.  Even if Voice over IP (VOIP) services do not emerge as a dominant mobile trend (I believe they will), then the social network aspects will be a major force unto themselves.

So, at least to this point the logic is that Social Networks = Global DNS.

The last aspect of social networks is that they can easily provide an “always connected” status.  This is the way instant messaging services (AOL, MSN, Yahoo, Skype) work today.  This always-connected feature creates a direct IP path between any two (or more) members.  If you have a direct IP path, you can easily create voice and video communications services.

The combination of social networks providing DNS-like service and IP connectivity is the core of the technological argument.  The fact that the Internet has trained a large segment of the world to access sites and services by name, instead of by IP number is my proof point that there should not be a sociological issue with my scenario.

The economics of this scenario are more difficult to predict.  I agree with those who said that the social networks and VOIP providers such as Skype would not run a global communications network without significant revenue and profit.  The issue to consider is:  Have the economics of providing a significant portion of this service forever altered in a significant manner?

VOIP service for home or business is significantly less expensive for the consumer than a direct-wired solution using 100-year-old twisted pair telephone technology.  The ease of provisioning and maintenance, and the lower cost of transmission and billing, has changed the economics of landline services.   It is less expensive to transmit and manage a very high bandwidth data path using Internet technologies, than to maintain individual transmission paths.  

Why not the same for mobile?

Item 2:  What should the Wireless Carriers do?

If I were the CEO of a major service provider I would execute the following strategy:

vzw_logo_1024Recognizing the importance of the trends that I discussed, the game that is now being played puts this mobile carrier at a structural disadvantage.  If you think you are going to lose at the game that is being played, you change the game.

The Carriers should obtain their own DNS service for their subscribers that updates continuously and allows for one click friend calling.  This service should be a collection of the key social networks.  

The Carriers should Interface/partner with Facebook, LinkedIn, etc and create a superset DNS of their subscribers’ contacts.  Then they should build the social networking application(s) directly on the phones to permit IM, voice, and video communications. The existing mobile numbers can be used as the equivalent IP addressing scheme.  The integration with the social networks will also permit contextual communications as the subscriber has access to their friends profile and status.

The strategy of partnering with the social networks for calling DNS functionality and contextual communications would create tremendous value. 

The marketing possibilities for a Wireless Carrier with this strategy are huge.

If this strategy was implemented by just one carrier (Verizon for example) then they could market to your friends list to switch and get In-Calling rates (free) when they call each other.  If 98% of your calls were within your social networking contacts, then it would make sense for that group to be on a single carrier.

The Carriers have tried viral marketing in the past with In-Calling and T-mobiles Fav-5 program.  What I am suggesting would be many orders of magnitude more impactful.  The first carrier that figures this out and executes will steal many of their competitor’s subscribers and really change the game.

The last issue for the Carrier strategy section is to counter the VOIP threat.

My strategy would be to embrace and profit from it.   There are two obvious moves to capitalize on mobile VOIP.  First, follow the strategy of the landline providers by creating your own VOIP mobile service that utilizes your connections into the social networks.  You can have a flat monthly fee for VOIP calls.

Secondly, you can also provide a “bring your own VOIP” service plan.  The Carrier would charge a lower monthly fixed fee that would reflect their lower costs in servicing these 3rd party subscribers.

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Over the past five years the bulk of new mobile service investment has been on mobile data applications. Mobile  voice services have not evolved beyond the basic voice call, callerID, voicemail stage.  This is the opportunity to merge the data application investments directly with the core voice service.

The real issue for the Wireless Carriers will be in the recognition of this threat and the real opportunity that this fundamental disruption in the market it creates for a first mover to capitalize on the changes and redefine how people communicate.

I hope I have addressed many of the Jeers that I got last week.  I welcome your comments on these expanded explanations and logic!

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