The relationship between operators and content providers reminds me a lot of a stereotypical rom-com. This is a predictable genre, the guy and girl meet and at first can’t stand the sight of each other, but as the film progresses the hostility cools and is replaced with real affection.
Usually by the end of these films the couple can’t keep their hands off each other, I am not sure if we are quite there with operators and content providers but are we getting close?
In the past operators may have seen content providers as free loaders. It was the operators that were footing the substantial bill for network design, build and maintenance and content providers were just piggy backing off of them. Only five or six years ago there were many examples of operators calling for content providers to contribute to their network costs. However, in the space of a few short years many of these operators have changed their tune and now view content providers as valuable partners in a digital value chain.
Operators are waking up to the fact that these content offerings can be powerful differentiators within their markets. At the recent Pricing Mobile Data Conference in London Deezer spoke about the success of their partnership with the Orange Group. Deezer is bundled in with selected Orange plans for the whole duration of the contract at no additional cost for the customer across seven of the Orange OpCo’s. Interestingly a recent survey Deezer ran of Orange France customers showed that there is 60% less churn and migration for subscribers using the Deezer plan versus those that are not. Statistics like that are big news for operators and with seven new markets broken into, Deezer won’t be complaining either.
Perhaps even more interesting though is the current way TripAdvisor and Telefonica are looking to work together. Telefonica have launched a new travel application, called “O2 Travel”, which aims to make it easier for their customers to use their data when travelling abroad, without having to worry about bill shock or relying on the use of WiFi networks. O2 Travel offers a simple and easy to understand daily tariff for data roaming at affordable low prices. The app will have integrated travel content from TripAdvisor on local attractions, restaurant reviews and much more. What’s interesting here is that it’s the compelling content from TripAdvisor that is perhaps acting as the main draw in a customer using O2 Travel.
The benefits in these new styles of partnerships are obvious to all. Operators get to add popular differentiating services to their offerings, open up potential new revenue sharing models and encourage increased data usage, while content providers are establishing themselves in new markets and taking advantage of some of the opportunities working with an operator provides such as subscriber base, established charging and billing models and brand recognition.
We are still in the relative infancy of these partnerships and where they can or will go next is up for some debate. If this was a rom-com then we would only be mid-way through the film. The girl and guy are only showing the first signs of romantic interest and we have a long way to go before they are truly a happy couple. Can these relationships stand the test of time, I don’t know? Operators want to stay innovative in their offerings and if a new sexy content provider comes on the scene I could see an operator being quick to stray. Either way this is worth getting a bucket of popcorn for.
This article was originally published in Openet's Blog.
