European Mobile Networking Day III in Cologne

Mobile Networking DayToday, the Mobile Networking Day event started again in Cologne, Germany. After 2006 (Cologne) and 2005 (Berlin) this has been the third event together with our partner Netzwert. After another successful year and the third year of MND this event has become a recognized annual conference. This year’s motto was “From Bandwidth to Business”.

Escaping the Flat-Rate Dilemma Looking at the portfolio of mobile and fixed line operators today, a dominance of access bundles, flat rates and plan options in the carriers’ value propositions can hardly be ignored. Often the striving for the best product has become a question of combining a boldface headline and two pages of fineprint in order to optimize revenue and margins. In that respect, network convergence has become a means to solely reduce operational cost and maintain competitiveness in a market of flattened subscriber growth and decreasing per-user revenues.

Prof. Dr. Jens BöckerOur today’s keynote speaker Prof. Dr. Jens Böcker from the University of Applied Sciences Bonn-Rhein-Sieg warns “There is no need for desperate pricing actions in the market. Stop the price war!” For Böcker it is up to the service providers to react on the changing customer requirements. The end-users are not anymore passive – they’re starting to design their own services and sharing them in communities.

But will Web 2.0 be an opportunity or a threat for Carriers? In the last years a series of innovative business models have emerged, driven by Internet startups, which mostly rely on advertising revenues and social interaction. Most of them still have to prove long-term profitability and growth, and not all of them are suited for a mass market. However, all of these new services have one thing in common: Despite their dependance on network bandwidth, the revenue streams that these services create bypass the pockets of the network operators.

Elmar Kinkel, COO and Stephan Hock, Manager Professional Service of Cocus AG, a consulting company which sponsored together with us this event, focussed on their presentation on explaining how deeper understanding of this broadband experience will lead to the design of successful, innovative and future-trend-setting applications like SecondLive or World of Warcraft. Online Gaming is big and is still growing: alone 3.4 billion Euro had been earned in 2006, 1.7B Euro was mobile gaming. As a servce provider, so Kinkel, you can be the man in the middle. And you can offer services cross networks like from PC to mobile and vice versa. (That’s by the way why I believe in our gaming server Project Darkstar which offers right this. And btw. it’s open sourced! Use it.)

Paul da SilvaPaul da Silva (Business Development Communications Industry EMEA) pointed out in his presentation, that there’s much more out there than consumer services like Gaming, Dating and Photosharing. His provocative questions: “Is web 2.0 really only internet for the lonely?” He says no. What about the business and their need to drive their internal communities (= workgoups!)? He pointed to Project MPK20, Sun Lab’s project to virtualize your office and work in an virtual environment like you know from services as SecondLife. Team members, regardless of physical location, can maintain awareness of what their team is working on by scanning the contents of the room.

Advertisement – The new revenue stream for mobile carriers Ralf HolighausRalf Holighaus, President & CEO of Netzwert AG spoke about “Business Revolution for Mobile Data”. He identified two trends in the market – the full service providers like e.g. Vodafone with own/branded services and the “no thrills” operators like MVNOs which go for a bit-pipe-only strategy fighting for customers with low prices and with only a handful services. But are these two the only opportunities you can think about? “Think about analogies in other markets”, so Ralf Holighaus, “what about EasyJet and Lufthansa? There is a trend to open additional revenue streams with complementary products, comissions from 3rd party companies (hotels, rental cars, online casonos etc) – and advertising.”

And true: Mobile network operators have big advantage again other companies: They have a billing relationship, they know the location and as well the identity of the end customer. This trusted relationship will help service providrs to think about new and appealing services sponsored through advertisement. And this might give carriers unexpected sources of income and will help to compete with “no frills” operators and their aggressive pricing AND still being able to offer high-quality services…

Manfred GötzManfred Götz is responsible for technical strategy, development and deployment of content and service protection at Vodafone. In this context he has gathered experience as technical project manager for the Vodafone Full Track Music service, which has been successfully launched in 19 countries. Later on he introduced digital rights management (DRM) for Vodafone’s global platform, which has been successfully deployed in 24 countries. His current position includes technical overall responsibility for service and content protection at the global platform, as well as support for Mobile TV, DVB-H and MBMS projects at Vodafone. You can bet that his views about “Service Protection – Revenue Enabler in Mobile Broadcast Business” had been very interesting for all of the participants.

Manfred Götz talked about the new opportunities USIM Cards will provide. For example to use them as an alternative to DRM as a key to get access to content and the challenges if you want to go this way for platforms, mobile handsets and SIM cards. At the moment carriers struggle with different service protection solutions which are sometimes proprietary, sometimes standards based, some handset dependant and others depending on the USIM. Actually this is definitly interesting as this will really connect two very different worlds – the integration of mobile TV applications into core network.

Why Telcos should not build „Toasters“ Michael Heuer (Vice President, Business Development & Consulting for Global Telecom Markets (formerly Wholesale Business), at BT Global Services) was the last speaker of the event with a wonderful presentation about Telco 2.0 and his provoking title “Why Telcos should not build ‘Toasters’”. “Everybody would wonder if EON, RWE or other Energy companies would start building toasters to increase their revenue”, so Michael Heuer in his visionary presentation. “But in the service provider market it is exactly like this exampel – carriers try to built toasters…”.

In his view everyone is innovative – but not the operator. They should concentrate on their main work, building networks – like BT did with BT’s 21st century project.

Summary In my understanding most of the presentations we saw today have been around Identity: If you don’t know the customer, you can’t offer appealing services. If you know that you’re customer travels (because his mobile is roaming a lot), have friends in foreign countries (because of international calls to non-business hours) or likes city trips you can offer different advertisement and give access to this knowledge to other companies (without loosing your ownership of the customer). This is why operators should look for federated identity solutions to open up for external services. This is why Sun’s driving the Liberty Alliance and our own identity management solutions like Java System Identity Manager.

Prof. Dr. Jens Böcker summarized the trend in the telco industry: Business models and technology are changing at the same time. Technology is now available for everybody. And the rules are changing for all players in the market. The key to success is to have a platform that offers services flexibly and quickly, based on company requirements. Böcker’s clear message: “Don’t wait. Act!”

This event will end tonight with a speech from Tim Renner, former CEO of Universal Music in Germany. At Universal Music he worked with a wide range of different stars like Eminem, Sting, Texas, Pavarotti, U2, Bon Jovi, Howard Carpendale or Rosenstolz. After leaving Universal and a journey around the world Renner published a book about the media industry in September 2004 and is one of a hundred managers worldwide who have been nominated as global leader for tomorrow by the world economic forum (Geneva/ Davos). He will talk about the change which happened in the music industry and how they tried to ignore the change. His answer: “In times of change the best way to survive is to attack yourself!”

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