Imagine if Vodafone became a Pay-TV provider or if Telefonica aligned with Skype to deliver a mobile VoIP service with unparalleled connectivity and quality. These scenarios are not as far-fetched as they might sound. It would have been inconceivable ten years ago to believe that BT would become a content provider. However, now BT has the rights to broadcast ‘English Premier League’ matches it will compete directly with Sky and ESPN. Markets mature, requirements change and companies diversify.
For over a decade wireless carriers have experimented with various service offerings outside of their core proposition, but with little success (remember Vodafone 360?). Now that LTE is finally coming to fruition, operators can develop services that will increase their brand equity and drive revenues. LTE provides the scale to introduce new business models based on strategic partnerships, as opposed to developing standalone applications. This is the view of Doug Suriano, the CTO of mobile software provider Tekelec.
Despite the popularity of video and VoIP Apps, there are limitations to using 3G or the public Internet, and users tend to shrug off their lower quality. But as operators can now provide improved performance and quality of services. However, with LTE perceptions will change.
Operators embraced LTE to provide additional bandwidth and lower mobile data delivery costs. However, LTE also allows them to lock the customer in to services on top of the basic mobile proposition. By entering into a partnership with an operator, a content provider – or OTT player – will no longer have to rely on the ‘best effort’ of the Internet. They will be able to utilise the carrier infrastructure to host services and provide a consistent level of service and quality. Entertainment brands and OTT providers will be in a position to successfully monetise services delivered over mobile networks; entering into lucrative revenue share agreements that will benefit themselves and operators.
Suriano speaks from experience, as Tekelec deals with network signalling, the process of fostering communication among mobile devices and the core network. LTE and the migration to all-IP infrastructure is invigorating network signalling, and it’s enabling protocol Diameter, and giving it a more prominent role in 4G deployment and new business models. By deploying a Diameter network to manage data congestion, signalling traffic and improve efficiencies operators will have a stable network environment to enable them to invite OTT players, and other service providers, to participate in joint ventures. Diameter has already enabled operators to introduce tiered services and scale to meet the demand for mobile broadband and applications.
The rise of OTT applications has seen operators open up to new ideas. Encouraging competitors to work closely with operators benefits both parties. The ‘Coopetition’ model will invigorate mobile networks, restoring their brand status with subscribers and driving new revenues for many years to come; all while improving OTT services.