Adopting CEM help convert OTT threat to data revenue opportunities for mobile operators
Today, smart phone users demand the high standards of excellence and efficiency from their telecom operators. The rise in expectations of an enhanced user experience with multiple mobile devices has increased the elasticity of demand among mobile customers. This means that many are prepared to switch operators if they don’t get what they want. As a result, operators around the world risk losing nearly 40 percent of their customers over the next year (source: NSN Customer Acquisition & Retention study 2013). Replacing lost customers is at best an expensive process, which affects operator top-lines and profitability significantly.
That’s why customer experience management (CEM) solutions are becoming increasingly conspicuous on the mobile operator’s radar. Telecom companies have been initiating efforts to adopt CEM to retain their customers and provide enhanced quality of services (QoS) on specific high value services and select OTT services. Analyst survey results show that nearly 60 per cent of operators desire to invest in CEM systems to improve customer retention, boost efficiency, increase savings on their operating expenditures and augment their revenues.
Even as a wide range of CEM tools is evolving to bring together pre-integrated software and related professional services across the IT domain, the network space and the entire customer lifecycle, there is one aspect that is largely unexplored: the role played by over-the-top (OTT) players in delivering enhanced and exclusive experiences to end users.
In India, the last year saw a major increase in data uptake across all circles, especially for 3G, after the recent tariff correction as identified in NSN’s MBiT Index study. With users consuming vast amounts of data, mobile operators have been grappling with challenges arising from commoditisation of data services that have provided users ample leeway to remain connected everywhere through ‘all-you-can-eat’ data plans. With data connectivity evolving to the status of a new hygiene factor for a growing number of mobile users, average revenue from data services per user is declining rapidly. To mitigate the effects of the unlimited data plans and ensuing revenue problems, service providers are exploring the need to initiate fresh efforts to create a differentiated user experience by integrating value-added services into data plans.
That’s where OTT players come in handy. Collaborating with OTT players would help mobile operators not only combat against the challenges arising from data commoditization issues, but also provide more user value in their data plans. Millions of popular and frequently used OTT applications and services are taking centre stage on a diverse gamut of connected devices.
The advent of Facebook and Skype as the vanguards of an ever-connected and technologically refined society has radically transformed the ethos of our communication with one another and our approach to managing our everyday lives. This means that mobile operators must reconsider their data strategies and find a way to gain a foothold in the OTT game. How do operators do that, especially when new mainstream IP messaging and voice applications are giving legacy services like SMS and voice a run for their money?
Here’s the good news: sophisticated, next-generation networks like LTE, which provides greater spectrum flexibility, media mobility and end-to-end QoS are being deployed to feed the burgeoning demand for high-quality data. A key advantage of integrating LTE into the OTT model is the use of free OTT services, like VoIP, which operators can accommodate into their mobile broadband data services – a move that would be beneficial for both operators and users.