Thursday, 31 December 2009

Orange hopes for halo effect from launching HD voice

Orange UK has announced that it will be launching high definition (HD) voice, using the Wideband Adaptive Multi-Rade (WB-AMR) codec. Full nationwide roll-out will follow in 2010, as will compatible devices. Press release here.

Mobile operators have been flirting with high quality voice services for years but I'm healthily sceptical about demand. Clearly, with 70%+ of revenue coming from voice, Orange and other operators need to explore ways to differentiate that service. But HD voice isn't the way to do it. Users won't pay more for it and mobile operators should be looking at reducing, not increasing, the load on their networks.

The migration of traffic from traditional fixed line, where quality is best, to mobile and VoIP services (such as Skype) shows that sound quality is really a fairly minor issue for most users. Price and convenience are much more important. It's also interesting that having perfect clarity on telephone calls has proven to actually be disconcerting for users. If lines are too quiet, network operators insert artificial background noise (Comfort Noise Insertion) when the other party is not speaking so the caller knows they haven't hung up.

So if no-one cares and no-one's going to pay, why do this? PR. This is surely another way for Orange to continue banging on about the superiority of their network. Whether or not their network is superior (and for the average punter it's completely opaque) it's vitally important to have a message that yours is best. The concept of HD is linked to superior user experience, so this announcement is all about the halo effect. Surely Orange isn't expecting anyone to pay extra to take HD voice. In a world where no-one knows who has the best network, but network superiority is a good differentiator, it's critical to find ways to communicate how much better your network is. Being cynical for a moment, perhaps HD voice is one way of doing that.

Tuesday, 29 December 2009

Mobile broadband in Saudi Arabia: Mobily pass 1m subs but average usage only 50MB/month

I just saw this report that Saudi mobile operator Mobily had just reached 1m mobile broadband customers. In a country of 30m people that's an impressive feat. Furthermore that represents a four-fold increase (almost) on the subs base at the end of 2008. Tariffs aren't cheap either, with the cheapest option costing USD27/month for 1GB, up to USD94/month for an unlimited bundle.

Usage levels seem to be relatively low. According to the Zawya report, traffic for December 2009 stood at 50 terabytes, which equates to just 50MB per user. So either there are lots of inactive users or internet usage is very light in KSA, which would indicate that the vast majority of users are on the lowest tariff and there is very little use of peer-to-peer file sharing.

Monday, 21 December 2009

Retaining mobile broadband customers: it's all about inertia

Analysys Mason has just published a report looking at the thorny issue of churn management in mobile broadband. MNOs must put retention at the core of their mobile broadband strategy looks at the customer retention and churn reduction strategies that MNOs must pursue to be as effective as possible at retaining subscribers. In a nutshell it's all about recognising the importance of inertia (of which there's a lot) and looking for genuine customer acquisition opportunities (which have to be sought out).

This report was put together on the back of work done on retention and churn reduction in the mobile world in general. See here for more details.

Also published recently was Strategies for mobile broadband in CALA: forecasts and analysis 2009–2014, which focuses on the Caribbean and Latin American markets where mobile broadband threatens to be a real threat to DSL infrastructure and revenue opportunities are substantial.

Both excellent reads and I thoroughly recommend them.

Friday, 18 December 2009

France finally awards 3G licence to...Free

DSL service provider Iliad has finally been allocated France's fourth 3G licence. As the only applicant for the licence it was a fait accompli that they'd get it, but it's nice to finally get confirmation. Free Mobile (as the new operator will be known) will get the license in January 2010.

The implications? A shake up of a pretty stagnant mobile market and a particular focus on mobile broadband. They are a very strong #2 fixed broadband player (19% market share) behind incumbent France Telecom and they have a real opportunity to cross-sell mobile broadband services. This is particularly true given the established network of shared WiFi hotspots that Iliad has. There are 3 million households with Freeboxes which provide both private and public WiFi access, so Free Mobile effectively already has 3 million basestations. How they exploit this advantage will be the determining factor for how successful Free Mobile will be.

SFR has recent made such a move targeting their NeufWiFi subscribers. For analysis of that see here.

Tuesday, 1 December 2009

3 admits that mobile broadband can't meet user demand for video

Interesting to see this article about 3's concessions to people who have suffered poor mobile broadband services. Clearly, given the nature of MBB coverage, the service won't be suitable for some customers. Try-before-you-buy and no-quibbles money back guarantees should be a fixture in any operator's MBB offering.

What caught my eye though, was comments from Hugh Davies that mobile broadband was never intended for video downloading and streaming. A quick look at their website also shows that they're now stating that for video usage, fixed is best. The implication being that MBB is, and will remain, a complement rather than a replacement to DSL. If MBB can't meet user demand for video usage now, it's unlikely to be able to do so in the future. Usage will probably grow faster than supply.

Of course, I have always maintained that MBB is a complement to fixed (see here) but it's particularly interesting to see a mobile-only player admit that a subscriber's broadband needs can't be met by mobile!