Guest article: Operators compete against OTT providers at the London 2012 Games

Madan Jagernauth, VP Marketing and Strategy, Mavenir Systems hopes to help operators tackle OTT messaging at the London Olympics

The 27^th of July will see the beginning of the most profound sporting occasion in the world – the Olympic Games. Thousands of spectators are due to travel from across the globe to watch some the world’s top athletes compete for gold at the London Olympics. As each event unfolds, spectators will have their mobile devices at their fingertips ready to update those unable to enjoy the experience for themselves.

Advancements in instant communication technologies and services mean that a number of people will be relying on sending messages via free over the top (OTT) services. The amount of messages to be sent through OTT services leaves operators with a potentially huge loss of revenue, raising concern for mobile operators as to how they successfully maintain revenue levels during events like these.

Messaging has evolved rapidly in recent years from SMS and MMS to new messaging applications, which are offered not only by the operators but by OTT providers. These services are taking away revenue from operators, while using their networks. A recent Ovum report found that social messaging applications cost mobile operators £8.8 billion in lost SMS revenue last year. In a market that is expected to reach eight trillion messages this year, OTT players are now a major threat to mobile operators. Indeed, a recent report by Mobile Squared for Mavenir confirmed that 80 per cent of the carriers surveyed agree that OTT messaging apps are a threat to SMS messaging.

Millions of messages will be sent via mobile devices during the Olympic games, providing operators with the opportunity to offer alternative instant communication services that enable traffic to be maintained within their eco-system and  provide new revenue streams that allow them to remain competitive against OTT providers.  Providing branded rich messaging services is an effective way for operators to extend their brand, add revenue streams and provide users with a richer variety of services.

During this year’s Olympics, visitors will be looking to send videos and photos of the games in action as well as texts about the event. In order to be able to compete with OTT providers, operators could offer a rich messaging service that adds value to the users’ experience if they are to effectively rival free OTT services.

Mobile Cloud Messaging (MCM) is a core network solution and white label mobile app for operators to launch rich messaging services and importantly, compete against OTT players by enabling them to harness traffic back into their eco-systems. Operators looking to offer rich messaging services should consider an end-to-end MCM application that is based on open REST based APIs using industry standard frameworks in order to provide a fully enhanced messaging communication experience to the user.

Further, MCM is a technology that provides operators with an opportunity to rapidly deploy and monetise this emerging communications trend with a cloud-based option and gives them an opportunity to provide a differentiated experience to subscribers using their networks assets.  It provides a seamless user experience based on a single phone number and with inter-working between the MCM-based service and the global SMS network.  There are numerous differentiating features such as no additional logins, use of existing mobile number, and group messaging and multimedia sharing.

Most OTT services are freely available for users however as we enter into the second half of 2012, we will see a number of new services that will use a freemium business model.  Freemium is a business model by which a product or service is provided free of charge, but a premium is charged for advanced features. One example is Skype, which is looking to monetise its offering, whereby they will charge for calls to non-Skype users. MCM has the ability to add real value to the operator service bundle and increase the stickiness of subscribers.  Examples of revenue opportunities include cloud storage and large media files sharing. By offering the MCM solution, operators can bring back revenue from the OTT services. In effect, this could maximise the revenue potential for operators at the London Olympics (or other key events) by keeping the traffic within their networks.

Users are looking for richer messaging services that to date have only been offered by OTT players. To ensure that operators are able to bring back the revenues lost to OTT providers, it is paramount that they have a competitive rich messaging service. The Olympics will see millions of messages sent in just two weeks, many containing additional content. The potential revenue for operators is huge however they need to put into place precautions to tackle OTT players. MCM can enable operators to tackle OTT head on, while creating an innovative rich messaging service for their users; keeping the customer satisfied, the traffic inside their network and revenue being generated.