Using Technology to Solve Real Problems

The telecoms industry is by its very nature a technology-driven market with an almost endless list of acronyms and terminology to be grasped before you can confidently ‘talk telecoms’. Every day my email inbox overflows with industry news about VoIP, Convergence, 4G, and so on, but rarely with any explanation of the real benefits they will bring to the end customer. A recent headline in particular caught my attention “LTE breathes new life into IMS” and my heart sank. The dreaded IMS acronym is back!

Five years ago the IP Multimedia Subsystem (IMS) was all the rage and being touted as the solution to all telecoms evil. Well that’s what it seemed like. The hype was such that someone even approached me at a conference and said “excuse me, do you do IMS billing?” (see September 2006 edition of Evolve) which now seems even more surreal than ever. It was rather like being asked if you do “traffic light driving”. Yes, of course when you drive your car, you go through traffic lights, they are part of the infrastructure that helps link the road system together, but you don’t see BMW marketing their cars around the ability to stop at a red light.

The problem is that too often this industry puts the cart before the horse, getting caught up with the technology and believing its own hype, without actually solving any real problems for its customers. The fact that IMS has been in the shadows for a few years is quite frankly a good thing. It is an embedded part of the 3GPP specifications and has been for 9 years. It’s there, it’s increasingly being used, move on.

Technology success stories

Now, 10 years after the industry was caught up in the hype over “3G”, which was massively oversold to the end customers, we are facing the same possibility with “4G” which is being marketed as a service in its own right. There’s even confusion within the industry about what actually constitutes a 4G service with operators such as Verizon in the US, marketing LTE technology as 4G despite this not meeting the ITU definition. If people within the industry are in disagreement or trying to confuse then where does this leave the end customers?

This obsession with technology may appeal to some, but for the majority of consumers they couldn’t care less what the technology actually is, providing the device or service works well and has a valued use. You only have to look at how Apple succeeded with the first iPhone. At a time when support for ‘3G’ and MMS were deemed standard amongst handset vendors, the iPhone was launched supporting only ‘2.5G’ (GPRS and EDGE) with no MMS, but it still jumped to the top of the handset charts almost immediately. The iPhone has been a huge success for a number of technology reasons (touch screen, accelerometer, apps, etc) that transformed the usability and usefulness of the device, but the underlying telecoms technology was not one of them.

Occasionally, a technology does become a success in its own right, such as SMS. Originally deployed as a system for notifying customers of voicemail messages, it has become a worldwide phenomenon now worth more than $100bn in annual revenue to the operators. However, contrast this with the development of Cell Broadcast systems which were set to launch location-based services and advertising 10 years ago, but are still to really find their place. Technologies that sell themselves are few and far between and generally extremely hard to predict.

Emerging market innovation

In mature markets, there is an obsession with technology-driven innovation to try to find the next killer application. Mobile phones are marketed as lifestyle devices, and services and applications are more frivolous and entertainment-driven than based on urgent needs. In this environment there may never be another ‘killer app’ as so much depends on personal preference when it comes to peoples’ lifestyles.

However, there are many lessons that can be learnt by looking at the innovation that occurs in the emerging markets. In these regions, the mobile phone is so much more important to peoples’ livelihoods, and consequently the innovation is linked directly to a real customer need or to lowering the barriers to use.

Here are some great examples from the African market:

  • Mobile money
    Mobile money has been the success story of Africa, with Safaricom’s M-Pesa service launched only 2 years ago leading the way. The reason for its success has been the simplicity of the service and the problem it solves – secure transfer of money from person to person. There are now more than 20 mobile money services in operation in Africa.
  • Small denomination prepaid top-ups
    These have been instrumental in making mobile services accessible to a wider audience, as well as smoothing out subscriber usage and revenue generation as users don’t have to save up before they can afford to top-up their account again. For example on yu in Kenya, you can top up for as little as 5 KES (approximately $0.06), which equates to up to 5 minutes of voice calls or 10 SMS.
  • Borderless roaming
    Pioneered by Zain across their African and Middle East operations, the One Network service means customers pay no roaming surcharges and have the benefit of paying local rates wherever they are in the network with no charges for incoming calls. Since the Bharti Airtel acquisition of Zain’s sites in Africa, the One Network service will continue but for the African operations only.
  • Dynamic tariffing
    Originally launched in South Africa and Swaziland in 2008, the MTN Zone service offers discounted on-net tariffs based on cell location and network load at that point in time. (The service actually uses cell broadcast as the means to communicate the discounted tariffs – see comments on cell broadcast above.)

All of these services use technology to solve a real problem and the solutions they provide are put in the context of the benefit they will deliver to the end customer. It seems obvious, but there are still far too many technologies being sold as just that, technology; and unless you can spot the next SMS, this strategy is almost certainly doomed to failure.

Technology is part of the fabric of this industry, but sometimes we all get caught up too much in the technology itself. This applies to vendors, operators and consultants alike. Too often procurement processes are driven by exhaustive lists of technical specifications and features that must be supported, without conveying the goals and benefits that need to be achieved. And this is a very dangerous road to go down.

As markets mature and competition increases, technology moves towards commodity, and it’s how you can improve the lives of your customers that counts. The customer experience is now king, and operators in mature markets would do well to look at some of the emerging market innovations to see how to solve real customer problems and differentiate themselves as a result.