Capture the Connected Device OpportunityDocument Transcript
S T R A T E G I C W H I T E P A P E R
Capture the Connected Device Opportunity
Profit from the power of intuitive apps and services
While connected devices and their apps are rapidly gaining popularity, they don’t fully
enable the mobile, multimedia and social lifestyle that people want. Instead of today’s
fractured and frustrating experience, people need intuitive, personalized and integrated
apps and services for their netbooks, e-books, tablets and other connected devices.
Service providers can capitalize on their high-value network capabilities to become expe-
rience providers, using intuitive apps and services to enable the lifestyle people want and
to bridge the gaps in today’s connected device experience. With this approach and the
right partner, they will be well positioned to capture the connected device opportunity
and increase revenue.
Table of contents
1 Capitalize on network capabilities
1 Understand the quest for connection
2 Give people intuitive apps and services
4 Bridge the gaps in the connected device experience
4 Make it easy and engaging
5 Make it seamless and simple
6 Make it relevant and rewarding
7 Find the right partner
Capitalize on network capabilities
As people race to embrace connected devices ranging from netbooks to e-books, tablets to toys,
their enthusiasm for a more connected lifestyle at home, at work and on-the-go becomes more obvi-
ous. The numbers tell the story: According to global research and consulting firm, Strategy Analyt-
ics, by 2014, we can expect to live in a world with more than 1.7 billion connected mobile devices1.
But will these connected devices enable the mobile, multimedia and social lifestyle that people
want — and are willing to pay for? More devices alone will not. When Apple® reported it sold
300,000 iPads the first day it was available in the US, the company also noted that more than
one million iPad™ applications and more than 250,000 iBooks™ were downloaded the same day2.
It’s the iPad’s large, multi-touch screen that makes its applications so appealing and intuitive.
And it’s the experience delivered by the combination of connected device and apps that changes
the way people integrate the device into their daily life.
Consider iBooks and online publications, such as Wired Magazine3: Content is rich and vivid, turning a
page is a hand motion, not a key click, and ads are interactive, emotionally engaging and full-screen.
But it will take more than the connected device and its apps to fully enable the mobile, multimedia
and social lifestyle people want. It will take the service provider’s high-value network capabilities.
And therein lays the connected device opportunity for service providers. By capitalizing on their
high-value network capabilities, service providers can become experience providers, using intuitive
apps and services to enable the lifestyle people want and to bridge the gaps in today’s connected
Think about visual voice mail. It’s the combination of the touch screen and the message that delivers
the highly intuitive experience that improves people’s work and life productivity. And the message
relies on the service provider’s high-value network capabilities.
Before we explore the specifics of how intuitive, network-powered apps and services will help service
providers capture the connected device opportunity, it’s important to understand the quest for con-
nection and the challenges people face today.
Understand the quest for connection
Today, people want to stay in touch with the people and the brands they care about all the time
and from any location. Many have multiple mobile devices and communicate using text messages,
instant messages and social networking sites.
Despite all of the evolution that has taken place, people still struggle with non-intuitive, non-per-
sonalized and non-integrated apps and services. It’s complex and cumbersome. And it’s productivity-
affecting for the rapidly-growing mobile workforce that relies on connected devices to get critical
information — patient health updates, meter readings, delivery confirmations — from the field back
to the organization.
Managing the Traffic Revenue Imbalance: Notebooks, Netbooks & Other Connected Devices, Mobile Word Congress presentation,
Early iPad app stats show Apple’s device a hit with gamers Financial Post online, April 8, 2010 http://network.nationalpost.com/NP/
Capture the Connected Device Opportunity | Strategic White Paper 1
According to TNS™ Technology, people crave simplicity in services and the process of searching
for, downloading and using services must be intuitive and seamless.
People are also looking for simplicity and seamlessness across devices — an experience global
market research shows they are willing to pay for. In a 2010 survey of the global youth market,
71 percent of respondents said they would use a multi-screen service; 65 percent would willingly
pay for it. In addition, 64 percent of respondents would remain loyal to their current provider if
it offered multi-screen services4.
With more connected devices and more involvement by third-party content providers and device
manufacturers, the customer service experience is becoming increasingly unsatisfying for consumers
and increasingly complicated for service providers to manage. Wait times are growing and all-too-of-
ten people contacting their service provider are told they’ll have to contact the device manufacturer
or application and content provider (ACP) instead.
43 percent of consumers are prevented from using services through their mobile due to issues associated
with ease of use. And 20 percent intend to buy a touch screen device for their next purchase compared to
9 percent for Qwerty devices5.
Yankee Group summarizes the situation this way: “Consumers’ need to be constantly connected
only raises the bar higher for communications service providers (CSPs) and their ability to manage
the customer experience beyond their traditional network domain. As consumers begin connecting
their world, there is less clarity on where to turn for guided advice for troubleshooting issues. Con-
sumers will turn to CSPs for everything from data connectivity to application downloads to home
automation. Yet today, CSPs cannot ensure the overall customer experience across a converged
ecosystem, let alone manage it cost-effectively6.”
To reap the rewards of the connected device boom, it’s time for service providers to take a bigger
role in delivering more intuitive apps and services and in improving on today’s fractured and frus-
Give people intuitive apps and services
Service providers are already investing in many of the high-value network capabilities and network-
enabling technologies — including 3G HSPA+, end-to-end LTE, IMS and RCS — needed to deliver
more intuitive apps and services. These investments put them in a strong position to play both a
direct and an indirect role in creating intuitive connected device apps and services: They can incor-
porate high-value network capabilities into innovative new apps and services themselves and they
can give ACPs secure access to their network enabling technologies.
Let’s look at how a one-to-many video sharing service for connected devices will help service
providers strengthen their position in the connected device value chain and create new revenue
Service providers have the opportunity to generate new revenue and increase customer loyalty by
launching innovative services and applications such as home surveillance, home security, home auto-
mation and e-health monitoring, or by extending their current IPTV services to content, multimedia or
Seize the multi-screen opportunity: http://www.alcatel-lucent.com/multimedia/MM-GREEN-Seize-the-Multi-screen-Opportunity.html
Global Telecoms Insights - 2010 Priorities, Sam Curtis, TNS Technology
Connected Devices Raise Customer Support Complexity, Sheryl Kingstone, Yankee Group, March 2010
Connected Devices Raise Customer Support Complexity, Sheryl Kingstone, Yankee Group, March 2010
2 Capture the Connected Device Opportunity | Strategic White Paper
Picture a backpacker video blogging around the world, an archeologist on a dig or a cameraperson
on the scene of a fast-breaking story. All of these people need to quickly and easily talk and share
video with a number of remote individuals. They — and the organization they work for — will be
interested in a service that helps them meet this need.
Figure 1. A one-to-many video-sharing service empowers end users and creates new revenue opportunities.
Sharing on-site archaeological video remotely
RCS / IMS / LTE
Getting the story to the newsroom
Blogging from around the world
With access to an end-to-end LTE mobile network, a converged IMS network and an enhanced net-
work address book based on RCS, any of these people can simply click on the right contacts in their
address book to set up a real-time voice and streaming video conferencing session with all of their
remote participants at once. It doesn’t matter where those participants are located, who their service
providers are or what devices they are using. Because the network is standards-based and supports
interoperability, it has the intelligence to figure out the location, availability, service interconnec-
tion and device specifics for each participant and automatically connect them.
Almost instantly, the backpacker is sharing his latest experiences with family and friends, the
archeologist is sharing her latest finds with researchers around the world and the cameraperson
is sharing footage with editors and writers back in the newsroom.
Storing the live-streamed video in the network and using their own and third-party APIs to add
context gives service providers additional service and revenue opportunities. For example, they can
offer to post videos to a blog or a video-sharing web site or make them available for inclusion in
mashups. They can also use presence and location information to “pre-tag” the video content with
context information or to add context to notifications, such as SMSs. Imagine the backpacker has
just arrived in Sao Paulo, Brazil and sent an SMS. Now aware of his presence and location, friends
and family can immediately start chatting and joining video-sharing sessions.
Capture the Connected Device Opportunity | Strategic White Paper 3
By securely exposing APIs for their network-enabling technologies to third parties, service providers
can further expand their role in the world of apps and services for connected devices and their rev-
enue potential. Consider the opportunities when the one-to-many video-sharing service is custom-
ized for specific vertical markets and uses, such as:
• E-health services for remote patient monitoring
• Distance learning services for real-time interactive education experiences
• An eyewitness video blogger app for adding text to videos
• Digital signage on buses, billboards and buildings for real-time public information, safety
The list of connected device apps and services that can take advantage of the service provider’s
network-enabling technologies is virtually endless. But dealing with growing numbers of devices,
apps and services has created other challenges for people. And those challenges have created an-
other opportunity for service providers — to bridge the gaps in today’s connected device experience.
Bridge the gaps in the connected device experience
As the old saying goes, more is not always better. With more connected devices and more apps and
services, the gaps between the experience that people want and the experience they have today is
actually widening. Consider their perspective:
• Why is it so complicated to start using new apps and services on my connected devices? I want
an easy and engaging experience so I can start enjoying my apps and services right away.
• Why can’t I communicate and watch my favorite shows across all of my connected devices as
well as on my mobile phone, computer and TV? I want a seamless and simple experience across
all of my screens.
• Why do I feel so disconnected, so unknown, so unappreciated even though I have all of these
connected devices? I want a relevant and rewarding experience no matter what device or what
network I’m using.
By using their high-value network capabilities as the basis for apps and services that bridge these
gaps, service providers can increase overall customer satisfaction — and revenue.
Make it easy and engaging
Whether they offer the connected device apps and services themselves or have relationships with
ACPs, service providers need to deliver an easy and engaging experience throughout the offer, acti-
vation, support and maintenance life cycle. With this approach, they can dramatically simplify the
end-to-end connected device experience and, at the same time, extend and strengthen their trusted
relationships with their customers.
An automated and efficient experience from all customer front doors — online, retail and contact
center — lets people quickly start enjoying their connected device apps and services. And it gives
them a personalized, single-point-of-contact customer service experience. Based on their service
transaction history and data in the network, people can easily discover apps and services that are
centered around what they want. And they can feel comfortable knowing their trusted service
provider has a history of following best practices for respecting their privacy and security.
4 Capture the Connected Device Opportunity | Strategic White Paper
The dynamics of the marketplace are changing. Yesterday we competed on price.
Today we compete on the differences in the services. But tomorrow, when all
companies look alike and offer the same kinds of services and pricing, we’ll be
competing on the customer experience.
– JeFFrey KAgAn, Telecom mArKeT AnAlysT 8
Service providers can use the additional customer contact opportunities to proactively make sure
customers have the apps and services they want and to reward customers for their loyalty. For ex-
ample, they can let customers know when they are approaching the limit of their data plan so they
can more accurately manage their usage or supplement their plan.
They can also proactively advise customers of service interruptions or degradation and provide them
with accurate service return times to manage expectations. These types of approaches, along with
automated renewal services and reward programs or discounts, will help service providers increase
app and service uptake, loyalty and revenue.
Make it seamless and simple
As people adopt more and more connected devices, it will become increasingly important for ser-
vice providers to deliver a single, seamless viewing experience across all of their screens.
The flexible viewing and multi-touch options offered by tablets, netbooks, e-books and other con-
nected devices create an opportunity for service providers to differentiate themselves by delivering a
multi-screen experience that provides context-sensitive content and conversations across any device
or social network.
This allows people to choose what they want to watch, when and where, and to pause and resume
content and conversations right where they left off across any screen — their connected device,
mobile phone, computer or TV. They can also share one “me” across all of their social communities
to dramatically simplify how they reach out to people.
Service providers are already starting to recognize the value of the multi-screen opportunity.
Telefónica®, Spain’s largest communications provider, has started taking advantage of its fixed
and mobile assets to deliver a unified experience across large and small screens.
While it’s still early days, there have been some positive signs of consumer interest in a multi-screen
offering: For example, a significant number of the O2 UK iPhone customer base is taking the Sky TV
option. The greatest interest in multi-screen is currently shown by high-end users9.
The trend toward a simplified, multi-screen experience is also catching on in the connected device
world. For example, the Amazon Kindle® offers a multi-screen experience through its Whispersync
technology which saves and synchronizes the last-page read, bookmarks, notes and highlights across
devices — Windows® PC, Mac®, iPhone®, iPad and BlackBerry®.
As quoted on www.motive.com
Telefonica: multi-screen strategy, Michele Mackenzie and Jonathan Doran, Ovum, April 12, 2010
Capture the Connected Device Opportunity | Strategic White Paper 5
In these cases, service providers can use their high-value network capabilities to extend and en-
hance the multi-screen experience. Picture Kindle customers in a coffee shop, using an app that
includes the service provider’s wireless network roaming and location-based services to take part
in a spontaneous book club experience with other patrons.
Make it relevant and rewarding
Along with delivering an easy and engaging experience to increase loyalty to their own brand, ser-
vice providers can help ACPs deliver a relevant and rewarding experience that will increase loyalty
to the ACP’s brand. It’s a revenue-sharing opportunity: The stickier people are to the ACP, the
more revenue for the service provider and the ACP.
Customized Interactive Voice Response (IVR) systems, interactive advertising and convergent pay-
ment are examples of service provider capabilities that will be very appealing to ACPs who typically
don’t have the experience, expertise or infrastructure needed for such capabilities. They will also
appeal to customers who crave simplicity and have a long history of working with their trusted
For example, service providers can:
• Use their subscriber intelligence and IVR systems to link people directly to the ACP’s support
center and ensure the customer service representative (CSR) knows why the customer is calling
before they make contact.
• Use their subscriber intelligence, presence, location and convergent payment assets to create
relevant, compelling and interactive advertising that will encourage people to click through ads.
• Use their convergent payment assets to add ACP purchases to the customer’s service provider
bill and allow them to monitor their usage and spending in real time. They can also use this
data to run reward programs on behalf of ACPs or provide the data to ACPs for their own
As shown in the convergent payment example, service providers can have a direct or an indirect
relationship with the ACP’s customers. The right approach will depend on the service provider’s
business objectives and market. For AT&T™, offering behind-the-scenes capabilities for Amazon’s
Kindle is the right approach.
“People know who the carrier is behind it [Kindle], but I’m comfortable being kind
of invisible in that kind of relationship. The key to this space is flexibility.”
– glenn lurie, heAd oF The connecTed device opporTuniTy AT AT&T 10
No matter which approach they choose, the key for service providers looking to capture
the connected device opportunity will be to work with a partner who can help them leverage
both their high-value network capabilities and relationships with third-party ACPs to become
Xchange online at http://www..com/articles/exclusive--at-t-s-glenn-lurie-on-the-ipad-and.html
6 Capture the Connected Device Opportunity | Strategic White Paper
Find the right partner
The right partner to help service providers capture the connected device opportunity understands
service providers’ business, their technologies and their operations and can deliver the solutions and
products needed to enable the mobile, multimedia and social lifestyle that people want.
Alcatel-Lucent is that partner. Through our deep understanding of application enablement, an in-
dustry vision and network approach that combines the trusted capabilities of service providers with
the speed and innovation of the Web, Alcatel-Lucent can help service providers deliver what people
and enterprises want: A richer and more trusted Web experience and more.
A High Leverage Network™ architecture forms the foundation for application enablement. It incor-
porates technologies, such as end-to-end LTE and IMS, to simultaneously enable efficient, low-cost
bit transport and innovative, revenue-generating services.
Alcatel-Lucent also offers a cloud-based global developer platform and developer program that helps
service providers extend their reach to the global development community. The platform includes
a set of developer tools, a virtual sandbox and application distribution capabilities that address the
entire developer life cycle and support service providers and enterprises with an end-to-end API
and application solution.
The developer platform builds on the Alcatel-Lucent Application Exposure Suite (AES), which
allows service providers to make key network capabilities, such as billing, location and network op-
timization, available to ACPs through a secure “exposure layer”. As an active participant in industry
ecosystems, such as the ng Connect Program, Alcatel-Lucent understands the value proposition
and shared-revenue opportunities that can be realized by pooling the resources of global leaders
in infrastructure, devices, applications and content.
In addition, our applications portfolio is strategically aligned around the building blocks required
to build intuitive connected device apps and services that fit the mobile, multimedia and social
lifestyle. With these solutions and products, service providers can:
• Effectively connect brands, media and application developers
• Easily create social collaboration and communications tools
• Efficiently transform network usage and traffic into real-time revenue
• Successfully extract full value from their 360-degree view of subscriber intelligence
• Significantly enhance the customer experience throughout the offer, activation, support and
maintenance life cycle
A comprehensive set of professional services ensures service providers have a partner that can
support them every step of the way.
Capture the Connected Device Opportunity | Strategic White Paper 7
3G third generation
ACP application and content provider
AES Application Exposure Suite
API application programming interface
CSP communications service provider
CSR customer service representative
HSPA+ Evolved High-Speed Packet Access
IMS IP Multimedia Subsystem
IPTV Internet Protocol television
IVR Interactive Voice Response
LTE Long Term Evolution
RCS Rich Communication Suite
SMS Short Message Service
• Application enablement
• High Leverage Network
• Alcatel-Lucent solutions
• Alcatel-Lucent products
• ng Connect Program solution concepts
8 Capture the Connected Device Opportunity | Strategic White Paper