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Guest Post: Device Management - The last leg is in your hands

Operators are familiar with the benefits of device management for their own services. The challenge ahead is to re-model the device management architecture that was originally put in place to address in-house needs so that it becomes a revenue generator in new two-sided business agreements with third parties. This involves a change in mindset, away from the “blackbox” telecom culture and towards more open thinking. Dominique Schmid, CEO of Sicap (a specialist in this field) explains further…

The VAS business model issue

The development of mobile value-added services has until now consisted of marketing an offer, then pushing content and, to a lesser extent, applications across a network. Sub­scribers hopefully discover it and may actually consume it, providing their device is com­patible. This “stab in the dark” model has obvious limitations, both in terms of user interest and availability across the device base. Most mobile users have already had some kind of negative first experience while trying to download content or an application, either on the content delivery side, or the device-compatibility side.

Common problems for the user may be as simple as for instance not being able to locate the download in the device menu. In this kind of case where complexity of the operation is a barrier, users not only experience frustration, but are also charged for multiple and identical downloads that they have never actually used! That the customer doubts the success of a download is not unreasonable. Recent studies have shown that on average 50% of all application downloads fail on a mobile device, and 85% of mobile TV users abandon the service after first use.

Common problems for the operator include a lack of marketing knowledge associated with their device base. Marketing questions such as « Are enough of our customers using devices capable of syncing with a PC for us to launch a bluetooth service? » cannot be answered without a “snapshot” of device capabilities in that particular market and a means of predicting potential ROI. It is clearly not about “what” or “how much” is on offer but on “whether” customers will actually be able to use services.

Changing the business model towards one where marketing teams can make informed choices before launching services will add value to the operator role as regards third party service and content providers connecting to the network. But how can operators break away from the limits of simple revenue sharing with content and service providers and justifi­ably position them­selves as matchmak­ers and audience builders in a broader value chain?

Tangible benefits, manageable challenges

Operators around the world are now familiar with the benefits of device management for their own services. Automatic service configuration has enabled them to reduce the average duration of customer calls related to device setup from 20 minutes to around 5 minutes. Firmware updates allow them to save on the 20€+ cost of recalling a device for repair.

Traditionally, Mobile Device Management has been used by telecom operators to provide post-sale device support. This usually entails sending configuration files for over the air download of “settings” Initially from customer care or self-care web interfaces; they are now often performed automatically based on certain events such as the detection of a new device, or failure to handover to another network technology.

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In the fixed world, Device Management involves sending firmware updates to correct bugs in the “triple play boxes”, first using basic proprietary protocols, and then using standardized interfaces allowing other parameters to be provisioned in the box.

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In both mobile and fixed environments, access to the device management platform is restricted to the operator customer care or network management personnel.

The Device Management joker

There is a growing need to achieve consistent service provisioning across multiple devices and channels. Being able to open up access to the device is a unique asset operators have and could capi­talise on. Device management therefore emerges as a strategic tool for enabling the next genera­tion of telecom business.

Playing a new match-making role in the Telco 2.0 two-sided business model implies the ability of the operator to profile mobile subscrib­ers and target them with personalized content and self-service capabilities. The device that used to be a simple phone is more than ever the last mile for achieving that contact. No amount of profiled information on your subscriber (from his favourite colour to the district where he spends his lunch hour) is of any use if he is not able to receive and respond correctly to the information you serve him. Additionally, an operator who is able to install, update and generally ensure seamless usage of evolving services for his customer will create brand loyalty. Mobile users will trust and enjoy using services proposed by the operator, and prefer to use them rather than shopping around on the mobile web for alternatives. If an operator can achieve this level of brand satisfaction through effective device management, it is in a good position to attract well known businesses into a two-sided business model arrangement.

There are four key principles of effective device management: know, set-up, update, secure.

Knowing
Firstly, an operator needs real time knowledge of which device is currently being used by a subscriber, what its capabilities are, and what has already been configured. Knowledge should be real time because subscribers may switch to a device with different capabilities and thus no longer be able to access certain services such as mobile banking.

Most mobile service providers cannot meet the challenge. They rely on declarative information from end-users to determine the type of mobile phone used, but the multiplication of device models with very similar form factors as well as the device branding strategy of operators renders that quite challenging for end-users and somewhat archaic in method. Service providers with some knowledge of mobile web browsing tend to use “user agent profiles” (the ID sent by a device which visits a web site) to determine the model used by visitors to their mobile sites. Most of the time those are not accurate and do not give enough information on the real capabilities of the device.

Setting up

The next step is to allow third parties to setup their own services complementing the operator offer, with anything from email accounts to video streaming. The operator is well positioned providing he controls not only the device but also the SIM, on a converged platform. An over-the-air Dynamic SIM platform can enable an operator to remotely control device menus, providing flexible and personalized services which third parties could benefit from.

In terms of multimedia service client provisioning, device manufacturers increasingly bundle powerful device-side clients which give access to mobile TV, push mail, instant messaging, data synchronization and the like. These clients are sometimes configured for the device manufacturer’s services such as Nokia’s Ovi for example. In the Telco 2.0 business model, operators can configure for their branded services. However, they could also set them up for third party service providers. Operators have the opportunity to charge those third parties to set up eligible devices through advanced device management. They could even go as far as remotely diagnosing and fixing device problems with third party over-the-top services.

Updating

Operators could allow third parties to update certain parts of the device, through installation of client applications that extend the capabilities of branded devices. As the hype around the Apple iPhone App Store and the Android market mounts, all actors in the mobile value chain are starting to realise the value of Mobile Software Management. Additionally, the current economic downturn could spell a longer average life span for devices.

Although not many operators will be able to successfully roll-out an application store to compete with Apple’s, device management platforms can provide tools which securely deploy (and may remove) third party applications on the handset base, not for one device model but for a large selection.

As we move into the so called “internet of objects”, operators can go a step further by allowing device manufacturers or corporations to update their devices themselves, using the operator infrastructure. A trucking company may wish to regularly update the GPS/GPRS module embedded in all its trucks. A manufacturer of WLAN digital frames may want to use the facilities of the operator device management platform to regularly deploy new firmware upgrades, without having to build its own infrastructure. For operators it would be a simple extension of the device management systems that they already exploit, albeit way below their potential.

Securing

Last but not least, the security issue around sensitive data is one that can be effectively and lucratively addressed by Device management. When devices are lost or stolen, operators need to be able to remotely wipe and lock content to prevent it from being misused. They may also remotely recover data for backup, allowing a quick restore when the user switches on a replacement device. Knowing that 30,000 devices were left behind in taxis this year in New York, and 20,000 left behind in London, and considering that it generally takes 3 months until activity gets back to normal when a device is lost or stolen, there is huge potential for operators if they react appropriately to the situation.

Open standards

The main challenge ahead is to re-model the device management architecture that was originally put in place to address in-house needs, so that it becomes a revenue generator in two-sided business agreements with third parties. Operators need to make sure that the architecture is open enough to be able to integrate their third parties. This means moving away from the “black box” approach that is prevalent in the telecom world, towards a more “web friendly” infrastructure.

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Operators also need to choose the right “open minded” technology partners, ones who will be able to support them with mash up platforms, without locking them in a single vendor relationship.
Vendor lock-in is very common in the Device Management space today, for example through the use of proprietary device side software which guarantees long term dependence on a single management platform from a single vendor. This approach contradicts an “open” model based on standard device management clients embedded by manufacturers. According to a recent study from Ovum, next year close to 1 billion handsets will ship with embedded device management clients supporting OMA DM standards.

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Early adopters of next generation device management include large Telco groups like Vodafone or Orange who have mutualised their infrastructure between all their affiliates. The latter is also quite advanced in aligning its device management strategy for all types of devices, mobile or home and in adopting an “open” model for its infrastructure. As other operators merge their mobile and fixed infrastructure and teams they should certainly be looking at device management as a way to quickly create a revenue story around convergence.

To achieve this, and to avoid “locking-in” to proprietary device and SIM vendor solutions, they should choose a device management platform vendor which not only guarantees open standards, but one which covers a large number of segments in the Telco 2.0 value chain.

{Ed - Dominique will be presenting on next generation device management at the Telco 2.0 event in London, on the 4th-5th of November.]

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Comments

Good marriage between 2-sided market model and device management. But, how pragmatic would this approach be looks like a moot point. Just for sake of a usecase, assume Nokia wants to do FOTA for - say, 100 different models of say, 2 million devices in the market. Now there is a key data missing with Nokia to proceed with specifc FOTA update viz., extent of distribution of the 2 million devices of 100 models across the operators. In order to access details of all (or atleast 90% of target devices) Nokia must be able to access maximum no of operator-maintained realtime device inventory. Specifically for a FOTA scenario what is the revenue-oriented compulsion/driving-factor for operator to expose the device inventory of their DM platforms to Nokia is questionable

Rgds
Muthu

The FOTA case is a good example on how difficult are the relations between device manufacturers and operators in a Telco 1.0 environment. FOTA today is a widely deployed technology (latest figures indicated more than 1bn compatible devices have been rolled out) but is under used outside of Japan and the US. The biggest manufacturers operate their own FOTA servers, mostly in a "pull" mode - the end-user has to check for updates, since the manufacturer has no access to the device inventory. The biggest operators also have their own device indenpendent FOTA servers, especially adapted for "push" distribution - pushing the update to all users who need it.

The problem is that manufacturers and operators are not cooperating. Operators do not get access to updates (for their own branded devices) and manufacturers do not get access to the device inventory (especially for devices purchased outside of operator channels, the so called "vanilla devices").

In a Telco 2.0 world the operator would charge the manufacturer to use its DM infrastructure and roll out firmware update to "vanilla" devices. New cases could be implemented such as automatically updating a device when it is turned on the first time, or batch campaigns. In exchange the operator would gain revenues and probably more support for creating and rolling out specific firmware updates for its branded devices.

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