Mobile carriers can’t compete with networks alone, must move to personalized service: Henderson

Mobile carriers will have to increasingly compete for customers with personalized, location-based services as network improvements make speed and reliability issues less of a concern among consumers, Ericsson Canada president and CEO Mark Henderson, told The Wire Report in an interview. As Canadian telecom providers improve their networks, they will no longer be able to win over consumers with promises of faster, more reliable networks. Instead, they will have to focus on creating personalized user experiences, particularly through location-based services, Henderson said in an interview. Location-based applications offer services based on the user’s location, which can range from finding a nearby restaurant to locating someone in an emergency. “Generally, with the networks, it’s a global standard; all networks will end up there at one point or another,” he said. “Certainly, reliability, robustness of the network and quality of the service being delivered, people value those things. But in the end, it’s the services that you receive that differentiate this operator from that operator. There will be a lot of applications and location-based services in the future.” Henderson added: “It’s all about the user experience.” Henderson pointed to the Asian market, where location-based services are ahead of North America. “In Asia, there are applications where people are shopping, and they put a barcode into the phone and the phone comes back and says well that’s $20 cheaper in that store that’s two blocks this way,” he said. Henderson said location-based services are the “future level of business.” Ericsson is investing in the trend by offering products and services to support location-based communications. Henderson said location-based services are also appealing to advertisers. “If you know the location of the mobile, and you want to advertise to the person that’s got it in their hand, based on demographics, based on where they are, there is a lot of value in that from a marketing perspective. People are just starting to get their heads around what that model might be,” he said. In May, Telus Corp. told The Wire Report that it was considering partnerships with universities, hotels and other organizations to offer new, location-based applications. But Duncan Stewart, the technology, media and telecommunications director of research for Deloitte Canada, said businesses could lose potential clients by signing exclusive contracts with carriers—cutting off customers from other network providers. Stewart said that, in the next five to 10 years, carriers could offer their own location-based services to consumers, locating mobile devices through cellphone towers. Stewart said carriers could also manage data traffic through location-based services. A carrier could move a mobile user to a local, third-party Wi-Fi network, temporarily taking the user off the carrier’s network. Carriers could also collect revenues from third-party application developers that need the carrier’s services to locate mobile devices. “Carriers want to have their own app stores … Although they haven’t done a great job doing that so far, they will get better at that because an awful lot of value is going to be in the app store going forward,” he said. Steven D. Gray, vice president of corporate research at Huawei Technologies, told The Wire Report the company is currently working on an “app mall” which would create a business model for carriers to monetize applications. Gray said the mall would allow the carrier to act as a “shopping mall,” which would feature several types of “application stores.” “Essentially you go into the mall and you pick and choose what types of services you want to offer … and the carrier can act as a distribution point,” he said. Gray said that while the app mall business model could be applied to a consumer model, Huawei is focusing on creating a model for enterprise services. Stewart said carriers could benefit from the app mall model, but that it would be difficult to market to consumers who are accustomed to a single source for their applications. kfournier@thewirereport.ca

Mobile carriers can’t compete with networks alone, must move to personalized service: Henderson

News | June 25, 2010

Unlock all the Canadian telecom, broadcasting and digital media news you need.

FREE TRIAL

SUBSCRIBE

Inside The Wire Report

Information

Hill Times Publishing

Get in Touch With Us