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Services packages boost revenue

June 18, 2004

At the European Wireless Leadership Summit, Ericsson promoted packages of services as the best way for mobile operators to increase revenue.

Mobile operators need a killer cocktail of services, not a single application in order to increase services revenue.

 

At this week's European Wireless Leadership Summit in London, Kurt Sillén, vice president of Ericsson Mobility World, used his keynote address to discuss the best way to market services to target audiences.

 

"When operators have run pre-paid campaigns offering a focused 'bucket' of services, they have had as many as 100,000 new subscribers on the first day," Sillén said.

 

Ericsson's key message at the summit, sponsored by The Yankee Group, was: "Invisible technologies give users what they want." This means that for mobile data services to be attractive, popular and above all profitable, they need to be user friendly and affordable, as well as simple for the operator to deliver and charge for.

 

The subtitle of the event was "Creating Profitable Growth in a Mature Sector". Sillén said: "The market is mature in the area of subscribers, but still in the very, very early days in terms of revenue and traffic growth."

 

Sillén said that operators could be categorized according to three phases of maturity:

  • Those who are communicating technology to end users, focusing their message on WAP, GPRS, MMS, 3G, etc.
  • Those who are communicating services to users - weather, news, sports and other information services.
  • Those who are focused on communities or segments. These operators try to exceed the expectations of these communities in order to move them to higher usage.
According to Sillén, most operators are currently in the second phase and are interested in moving into the third. Operators are concerned with the complexity of the service layer and need more support in integrating new services in their multi-vendor networks.

 

There is evidence that the market is ready for these 'beyond voice' services. One of the biggest successes so far has been the sale of ring tones and master tones, which are actual recordings of hit songs. In the US, the singer Beyoncé has sold one million master tones since January 1. This is far greater than sales of CD singles of the same artist. In Asia, where the master tone market is more established, seven million master tones were downloaded each month at one operator Sillén said the market recognized Ericsson as the leader in the technology and infrastructure of the service layer, but operators in general were not aware of what Ericsson could offer in the area of applications, partnering and business growth.

 

"We are working on this with one-to-one dialog with existing customers," said Sillén, highlighting that in operator surveys, a very high percentage believe that Ericsson can make a significant contribution in helping to introduce new services.

 

Ericsson is also working closely with developers to help them evolve applications and make them aware of enablers through the Ericsson Mobility World developer program . Ericsson acts as a global distributor for these applications, increasing the value of its end-to-end offerings.

 

Sillén stressed that real world results were invaluable. Ericsson offers end-to-end monitoring services to operators. "This is a quick way to determine what works and what doesn't," he said.

 

"From a technical perspective, individual nodes on a network may be performing well, but the overall user experience still may not be good. End-to-end monitoring allows us to get the whole picture. When this type of testing has been done, some operators have been able to realize a 30 percent increase in service usage and traffic."