Redmill Marketing Associates logo

Regulation is a curate’s egg. Discuss.

Is regulation always bad? Does it kill innovation? It may in some cases, but it certainly doesn’t always. To say otherwise is disingenuous and misleading.

There was an interesting story from last week, which discussed the topic of likely future regulation, and the impact it may have on innovation. In the article, Bengt Nordstrom from Northstream was quoted as saying: “The very idea that these companies [such as WhatsApp, Skype] must be regulated because they compete with operators is a step against innovation. The truth is that operators have not been innovative enough or fast enough, and in a competitive market that’s their loss. Increasing regulation on OTTs will damage the innovative climate that is very much needed in mobile industry.”

That’s true. But while it’s true, it does miss a key point, which is often overlooked these days. Sometimes regulation exists for a good reason. It’s why access to spectrum is restricted and allocated among authorised users, so critical services aren’t disrupted or subject to interference. It’s also why location information is required to be delivered from an operator’s network, so that emergency services can use it.

Some regulation exists to protect users. It’s how all emergency services function. It’s all very well to glibly state that regulation may stifle innovation but there are some cases where it is essential. Skype et al avoid the question of regulation because they set themselves up in such a way that they can dodge the responsibilities that come with owning and operating a national network. That’s fine, but the closer they get to ubiquity and the more users default to using their services (I know plenty of people now defaulting to such a provider for voice services over WiFi, for example), then the closer they must get to the purview of the regulator.

You can’t have it both ways. Offering these services is great – and they have been and continue to be innovative, both in terms of how they are delivered and the features they have brought to us. But equally, if you seek to play in waters that are regulated, then you must expect to have to deal with it.

The role of the regulator is to ensure a level-playing field. This means that they can and should step in when the occasion demands. We’re all for a light touch in regard to these services, but please don’t suggest that they can avoid a certain amount of regulation forever. Hiding behind the pretext that regulation will kill innovation is neither honest nor reasonable.

At a certain point, some regulation will be necessary and it will then be up to these agile companies to innovate again. Regulation is indeed a curate’s egg – good in parts. Legacy operators have often been hamstrung by the amount of regulation they face, but they must comply with stringent rules governing public safety and security. Newer operators sidestep this (although many, of course, have covertly complied with the more nebulous area of security). Neither position is right – but equally, it is muddleheaded to suggest that all regulation is, a priori, a bad thing. It is not – that’s worth remembering the next time you call the emergency services, use a GSM / UMTS device or connect to WiFi*.

*Yes, before you ask, we know that WiFi uses unlicensed spectrum. But it is unlicensed precisely because spectrum access is regulated in general. As a consequence, through the regulation of access to spectrum, certain bands have been left free, so it’s the regulation that has helped. Discuss.

Content is King – and what it means for telco strategies

Recent discussions have revealed great similarities between the challenges confronting small, regional ISPs in the UK and major Tier 1 operators with a global footprint. In both cases, content is key to a viable relationship with consumer customers; any other conclusion is flawed or shortsighted. But, recognising this points to some clear strategic choices and a simple template to guide future thinking.

The telecoms ecosystem is incredibly diverse and it’s easy to forget that there is a host of providers of key services that simply do not register in daily news bulletins. They may provide services locally or nationally, but tend to slip under the radar and do not, on the whole, attract a great deal of attention.

For example, there are more than 200 ISPs in the UK, many of which operate in a specific geographical area. We’ve met a few of them over the years and, last year, we participated in a very interesting panel discussion at a meeting on super-fast broadband delivery that was held in Manchester. The UK Government has provided funds to help spread faster broadband access across the country and to enable small businesses to obtain connectivity with the help of subsidies and grants.

Much of the meeting was taken up with the experience of local councils and other stakeholders in helping extend broadband to remote communities and progress in tapping the grants available (slow, could do much better, was the general conclusion), but there was also a good discussion on the topic of future strategic directions for these independent ISPs.

We’re returning to the topic because we have also had some informative conversations with mobile operators this year – and we’re struck by the similarities in challenges. As is well known, today’s operators are challenged to find relevance with consumer and retail customers.

According to one strategist from a leading regional operator, whom we met at MWC, there are essentially two elements to its strategic plans. First, secure content deals so that it can deliver exclusive coverage of the leading football leagues to customers. Without content, it’s just a provider of network connectivity and coverage – any other service or application will probably be delivered by some other provider, but accessed via the MNO’s network. Football (or something equally popular) is, it seems, the key factor in delivering something that is relevant to the lives of customers.

The second part of the plan required an enhanced focus on the needs of business and enterprise segments. There was recognition that future success and sustainable revenue growth can only be found by addressing the needs of B2B customers effectively. There are significant opportunities to meet unaddressed needs and actually capture new revenue.

So there you have it. Either invest in content partnerships or chase B2B customers, or both. It was a refreshing viewpoint and, as we found, one shared by others. As a plan for action goes, it’s quite a simple one, but one founded on realism. Of course, there are lots of things that operators can do around the edge to enhance efficiency and provide a better experience to customers – arguably, they should be doing this already, as everyone should care about delivering the best possible customer service and experience, shouldn’t they? But, it seems that, as far as consumers go, what it really comes down to is content. In other words, all the things about experience that have been discussed are interesting and perhaps helpful, but what customers really crave is quality content.

If you don’t have relevant and attractive content, then consumers will find it elsewhere, simply treating their operators as connectivity providers (not necessarily a bad thing, provided you are good at it). Which brings us nicely back to our ISP friends. Many of these are struggling. They have small market share in a landscape dominated by large, well-known players. In most cases, you really have to look hard to find these alternative providers – you have to have an almost nerdish interest in finding technology providers and few of us really have time to invest in this or even the inclination to do so.

To date, many have been focused on consumer and retail customers. Indeed, many had great success in winning customers but are now challenged by the power of the dominant players. But with the most attractive content deals now in the hands of a small number of providers, most consumers will continue to be attracted to these. A handful of players dominate the market and, unless Ofcom does something about it, will continue to do so. Maintaining a focus on the needs of a vanishing pool of consumers doesn’t seem a viable strategy in the UK market today.

In this context, there really seems to be only a single strategic choice for smaller ISPs that do not and never will have access to the kind of content consumers find attractive – invest in the needs of business customers through the provision of, first enhanced connectivity and then through the delivery of cloud-orientated services that can be accessed across this infrastructure.

There’s a lot of discussion about strategic choices for telcos, of any description. We think it’s really quite simple. All operators with network assets have simple choices in front of them, but the strategic plan can be distilled into a simple set of actions: Invest in the best network possible Provide a better customer experience and invest in continuous improvement Try to understand customers better through analytics Acquire content, if you can Invest in B2B markets

If you haven’t got or cannot acquire content, then provide a good and reliable network while focusing on B2B customers. If you have got content, invest in B2B customers too, as they represent an opportunity for growth. Without a superior network, customers will leave anyway; it’s just a matter of time. Operators are undergoing an existential crisis and are concerned about their future. It’s really simple – at least as far as consumer customers go.

But that doesn’t mean there aren’t opportunities. There are many. It’s just that spending time considering some mythical new service that may excite your consumers and make a difference, but almost certainly won’t, is really a waste of effort and energy. Some other provider will come up with the idea anyway and users will simply flock to it over your networks. Content really is king – you either have it, or you haven’t.

Omni-channel Service Delivery at the IMS World Forum

RMA to address omni-channel contact centres and the role of WebRTC in enabling new channels for consumer interaction and monetisation – and how service providers can play their part.

Each year we learn a number of new terms. Our favourite so far in 2015 is “omni-channel”. It’s a very useful term. If you haven’t encountered it yet, then a quick explanation should suffice.

We are all used to the concept of the contact centre. This is a platform that enables lots of calls to be handled so that customers can speak to agents and solve problems, buy things, or obtain specific kinds of services.

However, as we are all aware, the number of ways in which customers can interact with call centres has grown – it’s not just a phone call, it’s via social media, instant messaging and so on. A contact centre must be able to manage all possible forms of customer interaction – hence omni channel.

WebRTC has become a phrase with which most are now familiar. However, while there are many use cases for WebRTC-enabled communication, there has, to date, been little in terms of investment return. In fact, in many cases, WebRTC will never be a revenue generator as such; it will simply be another means of communication that must be supported.

However, the omni channel call centre does provide a number of clear use cases that can be monetised, in one way or another. At this year’s IMS World Forum, we’ll be discussing this topic and pointing to ways in which service providers can help contribute to the evolution towards omni channel communications.

Guy Redmill will be giving a speech entitled “WebRTC as part of a multi-channel strategy for customer care – the role of operators in facilitating delivery” and covering the following topics:

  • Why multi-channel matters
  • WebRTC as part of the mix
  • Increasing merchant value
  • Enabling the ecosystem
  • What should operators be doing to facilitate and capitalise on this?

If you are attending, why not come and see us? If not, get in touch and we’ll send you our presentation.