Mobile Operators and Digital Services: How Big Data Perfects the Equation
This two part strategy article discusses the rise of personalized and customized digital services and how this, combined with the Mobile Operators’ Big Data advantage, will enable Mobile Operators to take the lead in the digital services sphere.
By M Prushothma Rao, founder and CEO, The Fast Mode
How will big data work for Mobile Operators? As the last mile connection providers, Mobile Operators gather information on traffic utilization, bandwidth usage, congestion points and a host of network related data. These, coupled with subscription information, form valuable insights not only on network usage, quality and performance, but also on subscribers’ behaviors and preferences. The first generation big data was supplying Mobile Operators information that enabled them to plan their network better, make the right infrastructure and equipment investments, maintain network performance and offer innovative packages to optimize the network capacity. Big data was already playing a big role in ensuring that Mobile Operators deliver seamless, high-quality connectivity to their subscribers, while responding to their subscribers’ usage and consumption needs.
Bigger Data Ahead
What Mobile Operators would have realized is that the first generation Big Data is just the tip of the iceberg. Mobile Operators looking at expanding their markets and replacing their fast dwindling traditional revenue streams with more lucrative income from new services, especially digital services, will recognize the fact that their business and operational intelligence requirements are changing at a very fast pace. To successfully roll out the new breed of digital services and deliver them on multiple networks and devices, Mobile Operators will require insights that are very different from the first generation Big Data that they have been collecting and storing within their network systems and databases. When these old and new data sources are pooled together, Mobile Operators will be looking at colossal amounts of information that if rightly mined, studied and applied, will drive their product innovations, marketing and sales strategies and rake in future revenues in the digital services segment as well as on other services they offer. In the longer term, as their new businesses grow, more streams of information will be flowing into the system, especially information on subscribers’ data usage, content consumption, on-line habits, lifestyles and spending traits, further enriching the Mobile Operators’ ever growing pool of Big Data.
The rise of targeted and personalized mobile services
The new insights that will drive the Mobile Operators’ future businesses have to cater for a different game plan, and this is where the focus is shifting to targeted and personalized services, an entire new genre of mobile services. The rise of the targeted and personalized mobile servicesis attributable to a few major forces in the market, namely the maturity of mobile technologies that enables a huge amount of data to be seamlessly transferred over the mobile networks, the mobile lifestyle revolution that sees people adapting to ‘on-the-go’ data connections and the mass manufacturing of personal smart devices. The following points discuss how these factors are shaping the market for targeted and personalized services, and how Mobile Operators will be recreating their services to fit their subscribers’ needs in the digital age.
The herds have moved out and individuals are taking over. With different socio-economic, lifestyle and demographic attributes, the information, communication, entertainment and social needs of one person have become vastly different from another, even within the same family and community circles. This resulted in the individualization of web content, specifically across various web applications where users are given Virtual Identities and a host of options to customize their ‘accounts’ in terms of the news and information they wish to receive, the look and feel of the application’s interface, customization of their self profiles and the service features they wish to add on to their accounts. With the arrival of personal smart devices, the individualization went a step further, enabling users to assemble their personal favourites, in terms of applications and content, including their own private content on a single screen and have access to these at any time, from any place. This level of individualization at the user end is providing businesses a powerful channel, via which they can reach each customer individually and directly, allowing them to tailor and send the right content, services and messages to the right recipient, and by doing so, improve engagement, increase response rates, achieve higher sales and retain more customers in the long run.
Future State: Mobile Operators’ will source and integrate the widest possible range of popular content across their digital stores, media libraries and application bundles to meet the diverse needs of their various user groups, and by doing so, create hundreds of unique Virtual Ecosystems.
b. Shift to online living
There is a rapid increase in the number of hours people spend online as more and more communication, learning and transactions can now be conducted via the web. These activities include:
i. Browsing: The internet revolution coupled with the need for timely and accurate information has resulted in the new age human habit of ‘browsing’, where people spend many hours looking up information such as the recent tax rules, local bus schedules and the municipality’s housing rules. However, with browsing, comes the information overload as web users are forced to tediously wade across oceans of sites, text and images for that crucial piece of information. Time constraints will give rise to web personalization, where third party tools/services intelligently sieve through available information sources and choose, compile and recommend the most relevant and accurate content that matches the information needs of the users. Future State: Mobile Operators act as ‘Search Specialists’ to pre-select these information sources, which include websites and applications, produce comprehensive listings of these sources, rate, rank and deliver them via customized and highly engaging interfaces that cater for the daily information needs of their subscribers, regardless of time and place.
ii. Communications: The emergence of VoIP and the popularity of chat, message and social sharing applications mark the transition of voice communications onto data. The widespread use of these applications for making voice calls and sending short messages will see the creation of millions of Virtual Identities that interact with thousands of other Virtual Identities, forming Virtual Communities that redefine human communications and relationships. As these platforms mature, and as more people move to data connections for making calls, messaging and content sharing, an individual’s presence in the virtual community becomes an importance social attribute. This leads to users seeking ways to differentiate their Virtual Identities resulting in the demand for premium features and premium accounts that allow personalization and customization. On the service providers’ end, data enables a high level of service differentiation – in terms of quality, bandwidth, storage space, features, services and user and visitor interfaces - enabling them to respond to this demand and grant the more discerning users the choice to ‘dress up’ their virtual avatars according to their needs.Future State: Mobile Operators offer premium value-added features and functionalities on their chat, message and social media applications. These include richer content, luxury interfaces, higher bandwidth allocations, bigger storage and custom add-on services which enable them not only to cater for the different needs of their subscribers, but also enable their subscribers to create personal branding via their services.
iii. Transactions: An increasing number of modern day transactions such as job applications, membership registrations, bookings, reservations, permit applications and banking transactions are being conducted on-line. The proliferation of custom applications makes this highly conducive and efficient as transactions can be initiated within seconds of turning on the mobile device using the auto log-in feature provided on all apps. In future, almost all transactions will be apps-based and hundreds of thousands of similar apps are expected to flood the market. The challenge for the user will be to search, download, test and upgrade newer and better applications and also to ensure that they are secure, adhere to the user’s privacy requirements and do not carry any hidden costs, for example, unauthorized advertisements that take up the user’s data quota. Users will therefore need easy and ready access to pre-selected and customized families of apps that correspond to their lifestyles, consumption and transaction patterns and their privacy and security requirements.
Future State: Mobile Operators offer customized apps bundles that carry the best and most demanded apps within a user group or a locality, saving their subscribers from being inundated with hundreds of identical apps. Mobile Operators ensure the quality, relevance and reliability of these applications on top of ensuring that the privacy and security concerns are well addressed.
iv. Entertainment: Major improvements in the streaming technologies and the availability of high speed data connections are seeing a revolutionary change in the entertainment segment. Providers of Pay TV, video on demand and satellite TV know that the key to success in these segments is the ability to provide highly customized bundles that meet the diverse viewing needs of their subscribers, especially household, institutional and enterprise customers. Enterprise customers such as hotels and airports for example, will require packages that meet the needs of travelers who will use their personal devices to connect to their in-house TV channels. In this case, the content will comprise of not only top movie channels, but also the best local entertainment content and other content such as games, children entertainment and coverage of local places of interests that will keep the guests occupied, informed and entertained. Subscribers will be attracted to hand-picked content that matches their viewing purpose, their tastes, personal interests, their quality and rating concerns, their social and cultural attributes.
Future State: Mobile Operators use their Content Delivery Networks and partnerships with large content providers to push customized rich content via hundreds of channel bundles and on-demand videos onto subscribers’ devices, either directly from the Operators’ Entertainment Packages or through their enterprise customers’ digital platforms.
v. Shopping: The growth in online shopping has led to the creation of various e-commerce and m-commerce applications such as online banking, web-based payments, digital wallets, digital vouchers/coupons and digital stores. This growth combined with the widespread ownership of smart personal devices and the ability of these devices to display high quality, rich and interactive content opens up huge marketing opportunities for businesses. Businesses are collaborating with advertisement agencies, network operators and application providers to push marketing content that is customized to fit the device interface, the applications and the profile of the recipient. On the subscribers’ end, latest and timely information relating to goods, services and events which are relevant to their needs and lifestyles adds huge value to their personal shopping experiences, especially when it is highly targeted and auto delivered on their personal devices.
Future State: Mobile Operators act of virtual ‘Shopping Assistants’, telling subscribers what is available, the location, promotions and other information that will enable the purchasers to make informed decisions.
c. Urban living
Rapid urbanization results in cities that are not only denser, but an overall living environment that is more complex and sophisticated. Navigating and finding services and produce becomes equally challenging and a simple task such as going to a restaurant requires the knowledge of local roads, the list of restaurants and their menus, access to the booking services and finally, the availability of parking facilities. Mobile location-based services will become a huge feature in future, as urbanites rely on a simple, on-demand tool that can pull out required information on a particular place, event or service and at the same time push relevant information that is tailored to the inherent needs of the users. Real-time information such as traffic updates, transport options, events, promotions, safety alerts, restaurant menus, temporary jobs, retailer lists, local services and local government programs will create environment-aware urbanites, vastly enhancing their experience and quality of life in the cities.
Future State: Mobile Operators team up with local listing agencies, local retailers, services, local authorities and third party application providers to offer the ‘In-City Attendant ’ service which compiles, filters and pushes the most relevant information based on the subscriber’s profile information, present location and the current information need.
d. Multi Device and Multi Connection Adaptability
Ownership of personal devices plays a significant role in the growth of personalized and customized services. 25 years back, phone booths, theatres and community centres catered for the whole town population. These were superseded by home appliances such as home phones, TV sets and computers that saw households making their own communication and content consumption choices. Today, smart personal devices such as smart phones, phablets and tablets are taking over, merging content and communications on devices which are smaller, sleeker and many times more powerful. The emergence of these smart devices combined with multiple connection types and multiple levels of quality of service (QoS), creates the need for service customization at device, subscriber and application level to ensure excellent end-user experience on various applications and content types.
Future State: Based on the connection, device and subscription information, Mobile Operators employ connection prioritization, auto-rendering and auto codec /video quality selection which enable multi-screen adaptability and customization by the subscriber’s choice of device, connection and quality.
e. Virtual Organizer
Remembering events such as birthdays, anniversaries and to-dos such as back to school shopping, flight bookings and hotel reservations may not be too difficult. However, when these are topped with a more extensive list including due dates for mortgages, insurance and all the domestic bills, password expiry dates on various online accounts, membership renewal timelines for various services, car servicing schedules, lists of vouchers and their redemption dates, sales events at favorite retail outlets and seasonal promotions, the information overload can become overwhelming and stressful. Given the complex socio-economic systems most people operate in, individuals will start relying on tools or applications to remind them in a timely manner of upcoming events and the actions that need to be taken, and provide them recommendations based on real-time information. This will see the rise in the new breed of services that are intelligent enough to anticipate an individual’s needs and to push highly relevant information that enables users to plan ahead and make more informed and timely decisions.
Future State: Mobile Operators combine the subscriber’s personal, spending, consumption, lifestyle and subscription information with external updates from retailers, service providers, event organizers, public announcements, third party information sources and inputs from the marketplace to provide ‘Virtual Organizer’ push services that provide reminders and facilitation on daily chores and year-round events.
Facing up to the Competition
Mobile Operators are not the only players in the market trying to tap the huge potential of the digital services segment. The market is already teeming with businesses that have built a huge presence in this area, and are drawing up more innovative and aggressive strategies to expand their market share across their traditional and emerging services. Most of these businesses capitalized on the rapid growth in internet penetration and consumers’ appetite for web-based content and online shopping and socializing to provide services such as emails, social sharing, online shopping, online trading and video streaming, resulting in the roll out of many first generation digital services. From digital media to online stores, brands such as Napster, Netflix, Instagram, YouTube, Skype, E-Bay, Amazon, Pay-Pal and Facebook have become household names and are serving millions of customers worldwide. Retailers and banks have also opened their own digital portals where customers conduct various counter transactions from the comfort of their homes.
In the last 5 years, these services, which were delivered primarily via fixed internet connections, started shifting to wireless connections as more and more people with smart mobile devices found accessing these services while they are out and about a habit that fitted well into their lifestyles and their social and living needs. These first generation digital service providers started to gradually expand their services onto mobile platforms, flooding the market with hundreds of mobile applications and mobile sites which offered various services and conducted various transactions for mobile subscribers, including applications that rapidly ate into the Mobile Operator’s traditional voice and messaging revenues.
The challenge ahead for Mobile Operators and the incumbent players in the digital services segment is thus to attract a higher subscriber base by offering better product/service choices that meet the unique needs of their subscribers, which in turn necessitates them to personalize and customize their services according to these needs. This is where Big Data advantage enters the equation.
With big data, service providers will know exactly what their subscribers’ are looking for and can use this information to create, enhance and customize their services and their content according to the tastes and preferences of their subscribers. Without the information and analytics on current and historical usage trends, take up rates on various content and services, subscribers’ experiences on these services as well as the dynamics of the mobile market, players trying to make bigger inroads into the digital services segment, specifically mobile digital services, will be taking huge risks across their multi-million investments in data centers, content delivery networks, content partnerships, software and expertise. These insights are necessary not only for the investment decisions, but also to withstand the stiff competition from existing service providers and newcomers who continue to improve and adapt their content and services to the latest devices, connections and web technologies.
The Mobile Operators’ Big Data Advantage
Although most digital service providers have ready access to their existing reservoirs of Big Data that contain heaps of information on subscribers, their subscriptions, activities, content and spending patterns, Mobile Operators are many steps ahead in terms of the breadth and depth of the data as well as its quality and reliability. The Mobile Operators’ role as the connection provider grants them the access to individual-level information continuously and accurately, given that they have ‘around-the-clock’ connection to each and every subscriber, regardless of their location. The following factors discuss how and why this advantage will see the emergence of Mobile Operators as dominant players in the Big Data game, and hence leaders in the Digital Services market.
1. The Ubiquitous player
Compared to any other player in the digital services segment, the Mobile Operator has the highest reach. Although most internet users have at least one virtual identity or online account with web-based service providers, the per-area penetration is highest among Mobile Operators, even with the stiff competition among themselves. The necessity of a mobile device is the biggest push factor for the high number of mobile subscriptions. With data now being accessible via mobile devices, the number of mobile subscriptions continues to rise to unprecedented levels in response to the increased number of devices that require data connection. Mobile Operators are hence able to amass a large pool of subscribers for any given area, resulting in them having access to a bigger base of subscriber data that makes them more ‘knowledgeable’ of any local market, surpassing rival players who have a more constricted view of a particular market, limited by the sporadic subscriptions, intermittent access and huge variances (especially global services) in subscription and consumption patterns.
2. Integration of Services
The incumbent digital service providers have more advanced service platforms, established subscriber base and matured operational models. However, most of these providers offer a single service, be it video sharing, photo sharing, social media, chat and messaging services or e-stores. Mobile Operators however, partner with these content providers as well as providers of white label applications/services to populate their own cloud market places and offer the entire suite of digital services. With their own data centers and content delivery networks, Mobile Operators will be able to provide the same quality of service, in discounted bundle rates, using a single interface where subscribers can purchase, download, manage and pay for a wide range of services. Information and databases built from one stream of service provide inputs for the other streams and vice versa, enabling Mobile Operators to assemble the broadest range of highly correlated and relevant data compared to providers who offer single services. In addition, Mobile Operators can leverage on cross platform communications to gather further insights on customer experience and engagement on their services.
3. The Breadth and the Depth
Mobile Operators’ anchor services - the traditional voice and the high-speed data- are inherently one of the best Big Data sources as they gather some of the most vital micro and macro statistics, categorized into the following four classes of information:
a. The signaling across the hundreds of base stations, Wi-Fi access points and femtocells provide Mobile Operators continuous connectivity to the source of activity. Mobile Operators are able to gather micro level information, including real-time data on user location, activity and navigation information apart from device and connection types and translate this to macro level market analytics covering patterns of activities, consumption and lifestyles.
b. They have the most comprehensive, accurate and reliable subscriber information as most jurisdictions require true identities to be registered for activation of subscription plans. They also know the user’s economic status (via spending, package types and device information) and social activity (via call minutes, messaging, shared plan subscriptions and frequently dialed numbers).
c. Mobile Operators, via the Deep Packet Inspection and other related technologies, analytics and reporting systems, are able to access subscriber- level content consumption information, which includes the type of content and applications used, the types of transactions conducted on-line and the time spent on doing these. Mobile Operators will be able to learn not only about their subscribers’ browsing activities, content preferences and on-line habits, they will also have information on the response rates on various interactive content ‘pushed’ to the subscribers, including mobile advertisements. They also have enough information on the subscribers’ choice of retailers, banks, online payment facilities, utility companies and digital services providers to be able to decipher their subscribers’ social and economic ecosystems including their brand choices.
d. In addition to having real-time information, Mobile Operators own past data that is captured continuously over long periods of time, thanks to their subscription management systems, billing and charging management systems, portals and customer service systems which are configured to record this information over the lifetime of each subscription, which in turn enables Operators to conduct trends analysis and understand long term usage patterns.
4. Analytics-based Management
Mobile operators have an upper hand in Big Data infrastructure and expertise. Over the last 15 years, mobile operators have relied on network and subscriber information to manage their network performance. Network analytics are required to trigger real-time responses to service requests and manage various network issues. Mobile Operators depend on accurate real-time analytics to ensure consistent quality of service on various connections, and implement prioritization policies across their differentiated services and also to design and tailor innovative packages for subscribers. The prevalence of analytics-based management within their networks and product development has resulted in Mobile Operators developing the right capabilities and building the necessary capacity to manage and utilize large data sets efficiently and effectively. In addition, Mobile Operators can also leverage on the existing partnerships with solution vendors who offer built-in analytics across their solutions to develop and integrate more advanced analytics to their existing pool of Big Data.
5. The Seamless Connection
The traditional voice connection, which is the communication staple for mobile users, enables Mobile Operators to stay connected to their users, regardless of their subscription packages via the ‘keep alive’ connectivity. Mobile Operators are thus able to connect to subscribers who do not have data subscriptions, typically those who use Wi-Fi connections and those who connect to cellular data only at certain intervals (to save on data charges). Web-based digital services lose access to their users every time the user logs out of the application or when the user restricts the applications’ auto access to the device information or when the user steps into congestion zones where data transfer on these applications slows down. Mobile Operators are hence the only players in the market who will be able to continuously keep tab of their subscribers’ location, enabling them to produce the most comprehensive analysis of the subscribers’ navigation patterns, lifestyles and the movement of people within locations, venues and during events. Their advantage in this creates a further gain on their Big Data as local businesses wishing to capitalize on the Operator’s pre-knowledge, auto-detection and instant delivery capabilities supply more information (activities, events, news and updates) via the integration of their content onto the Operator’s cloud market place and digital marketing platforms. With the information flow from both ends, Mobile Operators will be gathering massive data sets that enable them to acquire the best understanding of the local markets, including the local commercial districts, popular brands and businesses, while serving their subscribers’ needs via just-in-time location-based services built using these information.
6. The Trust
Mobile Operators have a strong local presence. Apart from their offices, Mobile Operators operate call centers, service kiosks and service centers which provide subscribers a ready avenue to meet their service provider. As locally incorporated and often publicly held entities, subscribers are well informed of their management, financials and performance. Mobile Operators also invest extensively in creating brand presence, frequently appearing on billboards and in major media channels. The widespread multi-channel presence of the Mobile Operator and the strong brand perception as well as the state regulation of the Mobile Operators’ business and services form the ‘trust factor’ where subscribers are less constrictive in providing information about themselves, their whereabouts, activities, preferences and lifestyles. This facilitates Mobile Operators in accessing other layers of information captured within their network, their subscribers’ devices and on their service portals .
7. The Financials
Financial information forms one of the most important inputs to any commercial Big Data, revealing consumer lifestyles, financial status, spending patterns and credit worthiness. Mobile Operators are now complementing their connection services with credit and payment facilities. The Mobile Operators’ mobile wallet, the Near Frequency Communications enabled SIMs and mobile money will be used not only to pay for ring tunes and movie downloads, they will also be used to pay for groceries, merchandises, hotel charges and car rentals. This means that the Mobile Operator will have access to crucial statistics on the subscribers’ finances and spending patterns, beating even visa and the banks at their game as the wallet and NFC combined will be covering a wide range of daily payments, both virtual and physical. For subscribers, mobile operators will be the only players to offer the end-to-end delivery of e-commerce, from product information (mobile advertisement), product browsing to purchase (digital stores) and finally the payment (mobile wallet/NFC), all on a single device, via a single interface and on a single account. This will result in increased take ups on their mobile commerce services, including mobile payments, resulting in even more streams of financial data flowing to their databases.
8. The Quadplay Advantage
Quadplay Operators, who integrate the voice, mobile data, broadband internet and entertainment services, will be covering all of the subscriber’s connection and content needs. Subscribers will be accessing the same content, for example, movies from the Operator’s digital store from multiple devices, across multiple connections and in multiple locations. With a single account sign-on, subscribers are able to pause and resume their on-line activities from anywhere in the world. The single sign on, combined with content inspection systems and technologies, enables the Quadplay Operators to assemble the usage information across all their connections and channels and develop the most comprehensive database for each type of service and content within the digital services segment.
9. The Connected World
In addition to all the data that crosses their network and databases, the extension of mobile and fixed broadband connections to all other intelligent devices in the internet-of –things(IOT) will see petabytes and exabytes of data flowing through the system as refrigerators, smart watches, health devices, home thermometers, industrial machineries, high tech equipments, smart cars and various other machines start transmitting signals to the network. As the connection provider, mobile operators will be receiving and recording the first-hand information from these machines, creating a rich, real-time database that deciphers the situations and conditions in various remote localities.
The final equation
The ability to tailor highly customized and personalized services that respond to the dynamics of the market place and the ever changing circumstances and preferences of the subscribers will become the competitive edge for Mobile Operators expanding their businesses into the digital services segment. With their Big Data advantage, Mobile Operators will be able to dig deep into their huge data reservoirs and produce the statistics, analysis and insights that are needed to design, manage and deliver highly innovative and responsive services across the content, communications and commerce verticals. Within the Big Data domain, Mobile Operators, with their privileged access to more and more information, will emerge as strong data powerhouses, whose data reservoirs may spin off into new revenue centers and provide fresh revenue streams. In the interim, Mobile Operators which have acquired the necessary expertise and capabilities to leverage on their Big Data advantage will rise above the others in terms of innovation and product competitiveness, emerging as market leaders and delivering the best value for their subscribers.
The Fast Mode is a leading digital media services company and provider of analytics and consulting services for the mobile broadband segment, with particular emphasis in the OSS/BSS domain and the policy and charging control vertical. The Fast Mode’s Consulting Service provides strategic advisory on the development of innovative mobile broadband services, including digital services and mobile commerce and the design and deployment of mobile broadband solutions.