The explosion we have seen on the number of available mobile apps ought to make mobile operators start thinking “out of the box” and start opening more APIs that can be bundled together with operator billing – before it is too late!
|The mobile services market started at the end of the 90s. The first services were SMS-based and later we started seeing browser-based services, Java services, and ring tone and logo services that customers used to personalise their mobile phones.|
Many of these services were being offered by third-party companies that were using the mobile operators’ billing systems to charge for their services. Quite quickly, most mobile operators around the world chose an open garden model, allowing mobile service providers to market and sell mobile services across multiple operators. The operators handled payment for the services, which was subsequently divided between the mobile operator and the company that had created and marketed the service.
When Apple introduced their App Store, the mobile services market changed radically. Basically Apple introduced a business model where they controlled the whole value chain and decided which services customers could purchase. Instead of using the mobile operators’ billing systems, Apple handled the billing themself and shared the revenue with the service developers.
In other words, a number of App Stores on the market are not including mobile operators in their value chain and are instead using the mobile operators as dumb pipes that are only needed to deliver mobile connectivity to their customers.
In a world where operators on the one hand often subsidise mobile phones and on the other hand often previously used to make very good money from the premium SMS market, one could ask oneself why so many mobile operators have over time accepted becoming dumb pipes, when they actually have a number of very valuable assets that can be used on the mobile services market?
In our report OneAPI – Next Generation Value Added Services in the Mobile industry Strand Consult has examined these challenges and how a mobile operator can actually overcome these issues by taking their many APIs and bundling them with their operator billing services like SMS, WAP and IP billing.
We have no doubt that many mobile operators have many APIs and can easily develop more that can help make a number of mobile services far more interesting across the various mobile platforms. In reality, mobile operators should carefully consider whether it in fact could be advantageous to make their APIs freely available to service providers, provided that they use the operators’ billing systems.
However, having said that, you do not necessarily need to make all your APIs available for free. It is quite feasible that a mobile operator can sell various APIs to different service providers and make very good money from that business.
Basically today’s mobile operators have three products that can be bundled in many different ways. The three products are billing, APIs and connectivity – data transport in the form of SMS, MMS, mobile data and voice.
OneAPI – Next Generation Value Added Services in the Mobile industryexamines all the possibilities within this area and we describe the underlying business models that mobile operators and service providers can use when creating these types of business partnerships.
From an operators point of view, the largest challenge is that an increasing number of the mobile phones being sold on the market today are able to retrieve some of the information from the networks, that previously would have been handled via an operator API. What is happening is that the mobile handset is sharing its knowledge about the customer, the handset and the mobile network with the mobile service provider, without the mobile operator being involved in that process.
So an increasing number of mobile phones have a number of APIs that the mobile service providers can use when developing services for different types of mobile phones on today’s market. In other words, the mobile telephone manufacturers are utilising some of the intelligence available from the mobile network, but without the mobile operator receiving any revenue other than the mobile data being used. As you well know, that mobile data is often being sold as a flat rate product at little or no profit to the mobile operator.
In our report OneAPI – Next Generation Value Added Services in the Mobile industry; Strand Consult examines a number of the challenges and opportunities that both mobile operators, service providers and other market players actually have regarding taking advantage of the APIs that mobile operators ought to be selling separately, or alternatively bundling together with operator billing like for example SMS, MMS, WAP and IP billing.
If you would like to learn more about OneAPI – Next Generation Value Added Services in the Mobile industry and the optional extra workshop we can deliver together with the report, please do not hesitate to contact us.
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