VAS: Operators show their appetite for content

We asked some key players in the telecom sector about their content strategies
Du. Ericsson, IDC, Ovum, Umniah, VAS, Value Added Services

Share

CommsMEA: Some operators in the region have shown their appetite for content. What difference can content make to an operator’s business?

Atwater: When operators can provide desirable content on top of their existing services, they enjoy an immediate opportunity for new revenue.

An explosion of new content, applications and innovation can be created by exposing operator assets to third-party partners, thus drawing on the creativity of the entire ecosystem. In this scenario, the operator provides the ‘go-to’ portal for customers to access a wide variety of innovative content and value added services, while being a trusted operator, biller and partner. Personalised portals also provide great opportunities to create ‘stickiness’ and to up-sell the customer by providing context-based offers. This enables operators to increase their competitiveness and to provide valuable new services to their customers. And, as we know, satisfied customers are loyal customers.

Meymneh: Premium content can increase sales and usage of data services especially when bundled together, adding value to a Telco’s core services. In addition good content delivered correctly also increases retention and will act as a key differentiator against competitors.

CommsMEA: What kind of content will help to increase the revenue of the operators?

Dharia: In a world dominated by ease of availability to free content and OTT services, operators will find it harder to monetise their content services. This is especially true of high growth markets such as the Middle East where users were accustomed to accessing content from operators but now with the disruptive force of OTT they bypass the operator and access content free of cost from OTT players. This adversely impacts revenue growing capacity of mobile operators. Operators need to focus on quality of service and value-add features that can be monetised. In recent times operators have been successful in monetising services around security and device management.

Chaddha: The advent of the ‘connected-culture’ backed by a young population, continuously increasing smartphone penetration and growing affordability of mobile broadband continues to transform operating models for the region’s telcos. Mobile data and next generation value-added services have come to fore in operators go-to-market strategies. Operators are constantly in search of new means to either backward/forward integrate in the digital services value chain or at least devise new means to monetise the digital opportunities. To thrive in the digital space getting the right applications and localised content remains essential. Towards this, operators are fostering digital communities, setting up incubation houses and partnering with Over-The-Top (OTT) providers to offer right content to the consumer based on their needs and service usage profiles.

Meymneh: In traditional VAS, we have seen chat services and news, Islamic, and health related content create good revenues in the past. Now there is more focus on digital services where sports, games, and to a certain extent music have great growth potential. Health and education are categories to be explored for future services especially that they cater to a large audience. Across the board it is essential that content is localised and relevant to the end consumer.

CommsMEA: Gaming, social media and free messaging applications s are the most used services in the region. What opportunities do operators have when creating these kind of services?

Dharia: Gaming, social media and free messaging apps are all offered free by OTT providers. Operators can find revenue opportunities even within free services, for instance, operators play a crucial role in purchases or billing of content through operator billing across gaming and social media. Operators have also been successful in selling messaging app and social media bundles to users on a monthly subscription basis. If operators are to create these services in house then they must ensure that they leverage operator strengths such as user data, location information, customer care infrastructure to create truly valuable services for the consumer.

Meymneh: Straight off the bat operators can bundle these services to help sell their data packages. For premium paid services, operators can work with the content providers to create exclusivity for their customers, especially relevant for localised and customised content. One large area of development needed is in Direct Operator Billing, we specialise in reducing barriers to purchase, especially for mobile content, and this will be key to future growth in this sector.

CommsMEA: Which of the three sectors will offer more revenues to operators?

Chaddha: Gaming, Sports and Entertainment are three most widely used content categories in the Middle East. Getting distinct content catalogues for these categories remains important for operators to monetise. However, what operators need to realise is that Arabisation of the content may not necessarily mean it has been localised as well. Besides, operators may need to develop wider content libraries as many of the affluent Middle Eastern markets have a high percentage of expatriate populations whose preference for content may vary.

Meymneh: We can see good revenues from localised chat services which are more suitable for the region. However, social media and free messaging apps are dominated by international OTT players which makes it hard for operators to monetise. Gaming is a sure bet in the region, in the GCC, the monthly ARPU on social and online games is amongst the highest in the world.

Al Omoush: A considerable number of users have downloaded free instant messaging and social networking apps as it provides a less costly method of communication both locally and globally.

Instant messaging apps have replaced traditional SMS services, hence, causing a significant drop in revenues. Therefore, we believe that any of the three proposed solutions will act as an alternative revenue source for Umniah.

It is important to mention that the revenues seen from internet subscription fees do not compensate for the losses incurred by instant messaging apps. However, multicast applications and social networking sites have significantly increased the usage of internet, which is ultimately in the favour of companies.

CommsMEA: Vendors are also showing their interest in content as a value-added service for customers in the region. How are vendors promoting content among operators?

Atwater: Progress toward the Networked Society is rapid, with service innovation improving our lives in every industry, every day. Mobile operators are uniquely positioned to unlock the full potential of tomorrow’s technology. Consumer demand for more personalised services will be met with operator-owned network assets combined with partner services and applications that can take the digital experience to the next level.

Meymneh: Vendors are exploring a couple of ways to sell content:

For some OEMs, bundling platform with content is a way to push their platform to the operator. We have also noticed that operators are more and more interested in a fully-fledged end-to-end solution, accelerating roll out and reducing project complexity on their side.

Smartphone manufacturers (like Huawei) are also building their own App stores to push content that fits their specific users purchase power and interest.

CommsMEA: What kind of partnerships should operators agree with Over The Top (OTT) developers in order to offer new services to their customers in the region?

Dharia: Operators and OTT players should strive to work together to leverage operator and OTT strengths to create truly valuable products for the consumer which can be monetised. This might be in the form of leveraging free OTT content such as TV shows but ensuring that it has a high quality of service and is accessible across devices, which is an operator strength.

CommsMEA: Some operators are enabling users to use Apps without a data connection. How will this system help their value added services? How will this engage customers?

Dharia: This enables consumers to get a taste of data services and the app world before subscribing to a larger value data pack. It lowers the barriers to entry for mobile data users and in the long run will add to operator revenue through strong growth in mobile broadband revenue.

Chaddha: There exists a symbiotic relationship between three key players in the digital value chain: device manufacturers, OTT players and Telco. However, as consumption of digital content through applications has increased, each type of player has made advances into the territory of the other players. All three player types are aiming to leverage their relationship with end users and become the primary source for content, applications and services. However, there is no easy way to address all customer needs for digital content and services; hence, partnership will continue to grow among these players. Towards this, telecoms operators are investing in next generation OSS/BSS platforms that incorporate Policy and Charging Rules Function (PCRF) and Deep packet inspection (DPI) to offer new type of services and assured service experience for Over The Top services.

Policy and Charging Rules Function (PCRF) supports service data flow detection, policy enforcement (QoS control) and flow-based charging. Deep packet inspection (DPI) is a form of packet filtering that permits location, identification, classifications as well as rerouting packets with specific data payloads that conventional packet filtering methods cannot detect. Using DPI, operators can allocate network resources and control flow of traffic. For example, a packet tagged as high priority from an online gamer who has premium subscription for higher speeds can be routed to its destination ahead of another packet from a Facebook user who has paid less subscription for casual internet surfing.

REGISTER NOW | Webinar Event | Security you can bank on – Safeguarding the Middle East’s financial sector

Presented in partnership with security and network specialist Cybereason, the second in the three part webinar series will bring together a panel of experts to discuss how banks and financial institutions are evolving their service offering while simultaneously staying one step ahead of the cyber criminals who seek to bring their operations crashing to the ground.

Editor's Choice

Emerson expands analytics platform for industrial enterprise-level wireless infrastructure management
Plantweb Insight platform adds two new Pervasive Sensing applications that manage wireless networks more efficiently with a singular interface to the enterprise
Digitalisation seen as a competitive advantage by Middle East private businesses
Nearly 80 per cent of private business leaders acknowledge that digitalisation can impact business sustainability
Etisalat introduces Multi-Access Edge Computing architecture delivering best-in-class video streaming performance for 5G networks
MEC architecture achieves performance gains of as much as 90% in video streaming, validating how ultra-low-latency applications will be delivered over 4G and 5G networks

Most popular

Don't Miss a Story