Our recent article ‘Will lack of commitment derail OTT and CSP relationships’ got the attention of our friend Dean Bubley. We have never met Dean but people say he is friendly. And anyway, anyone who has the Twitter ‘handle’ @disruptivedean can’t be all bad.
The article, made topical by AT&T’s announcement of the arrival of sponsored or toll free data, was based on a survey by Telecoms.com. In it, the good news was that almost all respondents from operators believed that the way to address OTT players was to partner with them. The bad news is that 35 percent of both parties believe that lack of commitment on the ‘other side’ would be a very serious barrier to doing something sensible.
We wondered whether this was to do with priorities – the CEO is focusing on M2M so everyone is too. Or whether the problem was the ‘it is not broken, so leave it alone,’ or whether it was a lack of resources and skills in the organization.
In a very good analysis, @disruptivedean might just have put his finger on the reason for this lack of commitment. Sponsored data is a great idea but almost certainly unworkable. Reading his piece, you can almost see the enthusiastic start of the OTT player/CSP meeting; the big picture slide show; the discussion session; the Q&A; the pauses between answers getting longer and longer; the extra coffee break; the date for the next meeting, diaries clicking and people clicking their teeth and hmm, March is very busy….
His thesis, in essence, is that comparing toll free data to 1-800 numbers is banal and irrelevant.
– Web sites do not work like that, there are bits of sponsored data on sites that are already delivered by CDNs, bits that are not.
– There are multiple access methods for most users, it is not workable to address all, or even a handful of them.
– The opportunities for arbitrage, which Tony Poulos alluded to, are simply too compelling for dark side operators.
– Massively discounted wholesale prices offered to ESPN or whoever will undercut profit margins at the retail level, big time.
– The control, monitoring and billing/charging are simply too complicated.
– Why on earth would a brand want to pay for a customer’s data when the customer a) has plenty of data and b) shops happily with them anyway?
Given these points, and considering the avalanche of deals and wholesale billing arrangements that would need to be negotiated and managed for this to go mainstream, maybe we are looking more at a marketing device than a real product.
Some years ago, when electricity billing was sexy (well, OK, bordering on the interesting), there were web based demos which involved dials. As a customer you could go onto a web site and select your recipe of energy sources. Hmm, you would think, let’s have 30 percent Green, cool, 20 percent nuclear, and top up with good old fashioned coal.
Except, of course, the company could not ever actually deliver that mixture to the customer. It was a nice idea, a marketing gimmick and legally one that washed itself out at a wholesale level – until they dropped it.
Is toll free data a similar phenomenon? Or is it something that we can get our heads around, at some level? Because at the big picture level it is a good, innovative idea.