Openness in the telecommunication industry

Openness in the telecommunication industry Open with care or care to open? Carlos Domingo Director, Internet and Multimedia Lab TELEFÓNICA I+D June 19th, 2009 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Telecommunications industry will need to reinvent itself to face challenges ahead Revenue growths in traditional …and strong co-opetition for broadband and mobile markets new revenue sources is are diminishing… emerging Cumulative Annual Growth Rate (Percent) Mobile Internet Services & Content Differentiation from competition and identifying new sources of growth is critical TELEFÓNICA I+D 2 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Innovation will be key but we have to change our mindset to innovate differently… Environment changes From •  Pressures on TTM, shorter development cycles, permanent Beta as a must •  Knowledge is spread everywhere and is a not preemptive resource • Increasing information availability • Global Markets but finer segmentation • Coopetition versus competition • Here come the Prosumer …. To TELEFÓNICA I+D (*) Analogy borrowed from Henry Chesborough © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

… that for Telco’s particular case is represented on five paths to openness Open to Consumer Open Innovation Open the Network Open to Employees Open to Developers TELEFÓNICA I+D 4 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Opening conversations with customers to really understand them and foster co-creation Transparency and simplicity on communication, tariffs, billing, offer and, of course, claims Co-creation and two ways conversations with customers If you’re no longer speaking your customers’ language, if you no longer live in their world, the disconnect will be costly TELEFÓNICA I+D 5 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Going beyond traditional partnerships to establish open innovation networks… Startups and SMEs Universities & Technology centers Large corporations TELEFÓNICA I+D 6 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Although not something easy to do…. Remember last year experiment after the “friendly” operators panel at Mobile 2.0 Europe? Only 4 companies contacted me:  One just with an idea, no product to test or see  One with a product in a category already had one (and happy with it)  One in a category we were not interested  One ended up participating in a RFI (did not make to RFQ it though) Let´s continue trying!!! TELEFÓNICA I+D 7 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

… while fostering the internal culture of innovation to harness employees’ untapped talent… Bottom up Idea generation Using Web 2.0 Tools Implementing mechanisms to allow Boosting internal conversations any employee to propose an idea for and co-creation a new business opportunity. Transparency Great Place to Work Information has to flow inside the Building a better society, by transforming the companies, no more limited visions companies workplaces. “…open innovation does not mean killing internal R&D, you need smart people to talk to other smart people…” TELEFÓNICA I+D © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

… and openning our Networks as a Service to cover the long tail of innovation Telcos are finally realizing that there are major advantages to be leveraged by becoming an open ‘service platform’ to reach the long tail of developers without getting on their way Telco companies has unique and valuable assets that potentially could be mashed-up with the others Call Control Device access/control Service Delivery Infraestructure Mobile Internet SMS QoS Identity Charging Location TELEFÓNICA I+D 9 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

…but realizing that network resources are not the only telco assets interesting for developers Exploit user insight to deliver personalized services Context-awareness To know any relevant information for each particular situation Telco social graph To know customer’s social context & social spheres Personal To know the person behind the customer TELEFÓNICA I+D 10 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

and trying to make the developer’s dream come true: One API to rule them all! Network fragmentation Device and OS fragmentation Network independence Device independence TELEFÓNICA I+D 11 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

It is a long trip but the industry has started to walk the talk UX and Living Labs Open to Consumer Open Innovation Open the Network Open to Employees Open to Developers TELEFÓNICA I+D 13 © 2008 Telefónica Investigación y Desarrollo, S.A. Unipersonal

Openness in the telecommunication industry

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