Research Notes

Can over the air configuration of mobile terminals change the power balance in the mobile market?

We believe it can!
The ability to guide and control the setup of customers mobile terminals plays a central role in the operators attempt to achieve success with mobile services! If the many terminals in the operator’s network are not configured correctly to use i.e. GPRS or MMS-gateways, the customers are not able to download new services like i.e. games, music, ring tones and pictures.

A typical error can be when the customers sends a SMS to a premium service number, ordering a new Java game or a polyphonic ring tone, after which the download procedure fails, due to the terminal’s wrong settings.

As the number of terminals in the market increases and the amount of functions build-in increases, it multiplies the operator’s challenges to keep track of the terminals and ensure they function correctly and may provide easy access to the different service platforms within and outside their network.

A lot of operators choose to pre-configure terminals with the correct settings before they are shipped to the retailers. It is often an expensive procedure, which requires the operator to order a relative high number of the same terminal type. Pre-configuration do not however solve the problems, which arises if the customer changes operator, or purchases a new terminal without pre-configuration and gives the old one to a family member or a friend.

This situation requires both the new and the old terminal to be reconfigured with new settings. The experiences show that it is not a good idea to leave the configuration process to the customers themselves. It is simply to complex and time consuming for the ordinary user, and only a few will then fulfill the configuration. It is possible to get help at customer service or at the operator’s shop staff but this is also time consuming and very expensive for the operators.

New OTA (Over-The-Air) technologies make it possible to configure the terminals by distance. New technologies are helping the operators and customers. The technology was originally used for reprogramming the settings on SIM cards via specially coded SMS messages. It could be roaming numbers, SMSC addresses, menu structures etc. Since then the technology has evolved rapidly and the latest OTA standards opens for the possibilities of configuration gateway settings in the terminal itself, downloading new applications and updating software.

The advantages with the OTA technology are numerous. Firstly there are no requirements for physical access to the terminal to change its settings. Terminals can hence be configured before and after they reach the customers. The configuration process is transparent for the customers. They need only to contact the operator’s customer service to request their terminal to be configured automatically. Then the customer service employee sends a number of configuration messages to the terminal, which sets it up correctly. To remove the pressure on call centers most operators choose to offer their customers self-service interfaces on their web portal or via tailored SMS services.

It’s a painless process, which only requires the customers choosing terminal model, and the service they require configured, then the underlying OTA system makes sure to send the right information to the terminal, and sets it up.

OTA solutions are hence very attractive for operators, as they help keep cost down as well as heighten customer satisfaction, as customers are free from middling with the terminal to configure a number of settings. It is especially attractive in connection with services, as the launch of new services can increase the need for configuring the terminals, and this has until now been an effective stop block in the distribution of many services. The use of OTA solutions opens for the broad acceptance of services among end users.

OTA solutions open for a greater independence from the terminal, which is absolutely an asset for the operator. A possible scenario is, as soon as a customer puts the SIM in the terminal, the terminal receives all relevant settings, which makes the terminal immediately ready to use. The customer’s only action is to acknowledge the settings. This makes the operators less dependant on their own sales channels, as any terminal, also originating from other operators, can be used by their customers.

However as we conclude in our new report ”Successful strategies in the future mobile VAS market” the big prize for the operators is found when they utilize their own UI’s on the terminals.
This gives the operators a larger control of the user experience and the possibility to send small samples of services (appetizers) directly to the terminals UI. OTA solutions make it possible for the operators to immediately, when the customer inserts their SIM on a new terminal, ask if the customer wishes to download an install the operators UI on their terminal. This is a necessity for placing the UI on terminal distributed through non operator controlled channels.

OTA solutions consequently have the positive possibility to expand the use of mobile services and operator UI’s.

Successful strategies on the future VAS market

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