Mobile Broadband In Search of a Better Bundle

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Mobile Broadband In Search of a Better Bundle

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Blog from Cisco's Mobility Community, https://www.myciscocommunity.com/community/sp/mobility

Blog from Cisco's Mobility Community, https://www.myciscocommunity.com/community/sp/mobility

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  • 1. Service Provider Mobility: Mobile Broadband: In Search of a Better Bundle Posted by Brian Walsh Aug 14, 2009 In a previous blog, I discussed ways in which mobile operators can offer win-win subscriber services that let users access the abundance of mobile internet applications while addressing the operator threat from services substitution and revenue-less traffic growth. One approach in mobile broadband is “the bundle” – mobile data service plans that provide a combination of on-deck and internet-based services. Fixed broadband providers have long offered “Triple Play” bundles of voice, video, and data. Some have added in mobile services for the so-called “Quad Play” (thus turning the original baseball analogy into a mixed metaphor!). But how effective has the bundle been for mobile operators? The Basics: Many operators are offering “flat rate” mobile broadband plans, typically in tiered levels of maximum monthly fair usage policy (FUP) quotas. Plans from operators such as AT&T, T-Mobile, 3 Sweden, Network Norway, and others offer “Light/Medium/ Heavy” usage packages at different price points based on the size of FUP allowances. Pricing further varies by the length of the contract and whether the subscriber connects to the 3G network with a smartphone or a dongle-connected laptop or netbook. These bundles give subscribers a “pay for what you need” option at the data usage level.  Once monthly quotas are reached, operators are employing a range of ways to notify subscribers and/or restrict services while maintaining subscriber satisfaction (and retention!). The risk of a billing surprise can still be great, especially for 3G dongle users who consume bandwidth with “fixed line behavior”. Often users do not even have an understanding of their monthly GB limits or the extent of the financial risks they incur! The Wi-Fi Extra: Several operators are giving users something “extra” on top of mobile broadband by bundling Wi-Fi access. Operators are partnering with hotspot providers and/or leveraging their own Wi-Fi networks to gain competitive differentiation and provide additional value for their customers. For example, AT&T offers iPhone and BlackBerry users free Wi-Fi at certain public venues. According to AT&T, nearly 15 million users connected to their public wireless hotspots in Q2 2009, a 41% increase from the Generated by Jive SBS on 2009-12-07-07:00 1
  • 2. Service Provider Mobility: Mobile Broadband: In Search of a Better Bundle previous quarter. [Note: Trend continued in Q3 2009 when AT&T reported that more than one-half of all Wi-Fi connections were made by smartphones and other integrated devices vs. laptops.] T-Mobile smartphone users can use Wi-Fi at T-Mobile hotspots as part of the company's HotSpot@Home service. This type of bundle gives users greater connectivity options while also offloading traffic (and costs) from operators’ 3G networks, benefiting all network subscribers.  The Fixed-Mobile Bonus: Not surprisingly, operators with both mobile and fixed broadband networks are offering this logical bundle extension to the mobile broadband bundle. For example, Verizon is giving its FiOS customers free Wi-Fi access at more than 100,000 hotspots around the world. BT’s Total Broadband gives customers Internet access over its 3G network per FUP-based tiers with unlimited usage when accessing the Internet over BT’s Wi-Fi hotspots. The Personal Touch: a Bundle for Me! All of these bundles are attempts by operators to simplify their offers, create additional value for subscribers, and cross promote services – in the quest to drive higher customer adoption and retention. But these early approaches are still primitive, where the focus of the bundle is largely at the network access level. The real promise of Mobile Internet monetization will be reached by operators that can offer subscribers the ability to flexibly choose and pay for applications and services that they want. Operators will increase customer “stickiness” with user-controlled personalization and can drive higher ARPUs from the deeper market segmentation enabled by subscriber personalization. A positive step in this direction comes from operators who have begun to offer what might be called “personalized paks” that target certain subscriber demographics. 3 Australia, for example, offers a wide range of mobile broadband packages grouped into themes such as entertainment, news, sports, social networking, etc. The packages contain both on-deck content and services as well as access to favorite 3rd party internet applications. While risking some confusion over the range of bundles, the demographic and theme-oriented services bundles make it easier for subscribers to select a mobile broadband plan that appeals to their interests (and the capabilities of their mobile phone). Just got a new video-friendly device and don’t want to ever miss the latest cricket highlights? Subscribe to the Mobile Internet Sports pak! Operators are beginning to deploy intelligent IP networking capabilities that give them the subscriber, session, and application-aware intelligence needed to offer subscribers the ability to personalize their service subscriptions and usage. Even more importantly Generated by Jive SBS on 2009-12-07-07:00 2
  • 3. Service Provider Mobility: Mobile Broadband: In Search of a Better Bundle for operators’ revenues, these capabilities will give their marketing organizations the business flexibility to cross-market add-on services, loyalty programs, customized advertising, promotions, bi-directional partnerships with 3rd party content providers, and more. Have you seen other mobile internet services that include innovative user personalization? 2,199 Views Tags: mobile, mobility, 4g, 3g, bundles, mobile_internet, mobile_monetization, mobile_operators, mobile_broadband, ip_intelligence, personalization, mobile_applications Aug 17, 2009 10:35 AM Andrzej_Milkowski Hello Brian Looking for alternative strategies, I think, it is worth to observe what is going on around iPhone applications (Widgets) as well as Google mobile services. Both, provide light, useful and "relatively chip" widgets helping customers on-the-move on-demand simplify their live. From operator's perspective, offering flat rate mobile broadband plans was almost a must for us, as long as properly defined standardized "PCRF" solutions are not available. Once technology giving operators flexibility, like in case of voice contracts, will be given to customers, it will be easier and most important PROFITABLE to go that path. I do not buy idea that giving "more for less" (in this case bundling) is better. I follow strategy of personalization, or rather call cluster based targeting personalization. Regards Aug 17, 2009 1:52 PM Brian Walsh Andrzej_Milkowski in response to Andrzej Thanks for your reply and thoughts! I agree widgets and mobile "cloud" services are also exciting developments for new mobile applications and services. A couple of questions for you if you don't mind: Generated by Jive SBS on 2009-12-07-07:00 3
  • 4. Service Provider Mobility: Mobile Broadband: In Search of a Better Bundle - What kinds of services do you think operators will offer once standards-based Policy solutions are available or mature enough for deployment? - and can you expand upon what you mean by "call cluster based targeting personalization"? It sounds interesting :-) regards Brian Aug 18, 2009 9:25 AM Andrzej_Milkowski Brian Walsh in response to To answer to first question, our Marketing initially was interested in offers like: 1. Time based charging. E.g. "internet for 2 hours" or "low cost access between x hour and y hour". 2. To get P2P users from ADSL contracts (surprise, surprise:-) ): "night fetch, no limit". 3. QoS - Gold, Silver, Brown - differentiate accordingly to e.g. Business, Postpaid, Prepaid. 4. Special bundles for users with modern terminals like Android, iPhone etc. I shall write "Call it cluster based targeting personalization". I mean the personalization is limited to some defined scope of flexibility. E.g. we can not offer to user possibility to change any parameters of the offer due to fact it is to complex. It is easier to first understand target groups of users and address them with scoped flexibility. Sep 16, 2009 8:28 AM Brian Walsh Andrzej_Milkowski in response to Andrzej, Generated by Jive SBS on 2009-12-07-07:00 4
  • 5. Service Provider Mobility: Mobile Broadband: In Search of a Better Bundle Thanks for the clarification. "Cluster-based targeting personalization". I like it! And it makes sense as you say to offer target group-level personalization in order to limit the complexity to the network. So, of your consideration on offers 1 - 4, any early results re. customer acceptance? Especially #4, with nextgen smartphone-based bundles? Generated by Jive SBS on 2009-12-07-07:00 5