By Andy Tiller, Vice President Product Marketing at AsiaInfo
With sponsored data hitting the headlines courtesy of AT&T, operators’ commercial partnerships are in the spotlight.
Sponsored data allows customers to consume data without impact to their price plans – who could argue against that?
However, sponsored data is tiptoeing gently around the issue of net neutrality, with the US Communications and Technology Subcommittee saying that AT&T is “in the business of picking winners and losers on the internet, threatening the open internet, competition and consumer choice”.
The point is that operators have to innovate to protect their business. We are seeing evidence with OTT services that if operators collaborate and add value, giving the OTT companies access to established customer and billing relationships and reliable OSS/BSS systems, then a profitable, and innovative, business model can emerge for both parties. In addition, the mobile consumer gets a value-add service.
There is significant potential for revenue creation if operators use intelligent collaboration platforms. Sponsored data is just a first step. These platforms enable a fundamental shift in service structure, giving operators the ability to add value to OTT services, and the insights to offer highly targeted marketing campaigns to advertisers. And again, the mobile consumer can enjoy a much improved experience.
Advertising will be a major application for the adoption of sponsored data as a business model. Today’s big data analytics platforms can provide operators with a detailed understanding of how their customers are using mobile data: the apps and content accessed, the model of mobile device used, and the location.
This information can be combined with the ability to push highly-targeted advertising to relevant customer segments at an ideal moment, based on a real-time understanding of each individual customer’s context.
Of course, the user can choose not to opt in to such a service, but the ability to directly address a user’s interests should increase acceptance.
Take the upcoming music festival season as an example, when an operator could partner with an OTT music provider to launch a new premium service. An intelligent collaboration platform first enables the creation of a “mash-up” offer, perhaps combining sponsored data, premium QoS (controversial in many parts of the world, and subject to net neutrality considerations) and other operator value-adds to the music streaming service.
Big data analytics can then identify the operator’s customers attending the festival who use music apps and browse music-related content on their phones. When they access music content at the festival, customers are sent a push notification about the music provider’s new service, with a one-click subscription link, and an incentive of three months’ free service if they sign up that day.
This scenario shows how the operator is able to deliver an exclusive offer to a specific customer segment; the music provider is able to execute an accurately-targeted campaign to individuals that are already pre-qualified as music fans, and the mobile users receive an offer that is directly linked to their area of interest.
The operator might get a cut of each subscription, the music provider gets a higher response rate, and the end user gets the opportunity for a time-limited free service.
With sponsored data, AT&T is letting advertisers pay for the data traffic required for mobile users to watch their ads, instead of the user “paying” by using some of their data allowance.
But in this scenario the operator adds relatively little value to the advertiser, and there is not much incentive for the end user to actually watch the ad. How much more compelling would this be if the advert was targeted based on real time context?
Take another example – a football fan looking forward to the World Cup in Brazil. He’s browsing on his mobile phone for news about the World Cup schedule when receives a great offer from an advertiser to enter a prize draw for World Cup tickets.
All he needs to do is click a link to watch an advertiser promotional video. He even gets an immediate 10MB data credit from an operator, whether or not he wins the tickets. The fan clicks the link, watches the ad, receives the free data and also gets a push notification confirming his entry into the draw.
Under net neutrality, any network advantage offered to one content partner must also be available to all others.
Today’s intelligent collaboration platforms are designed to enable access for a large number of partners. They are highly scalable, and remove the bottleneck and cost of IT integration with partner systems. They deliver the added benefit of scaling the operator’s potential to earn new revenues through two-sided business models.
Real-time, context aware targeting makes the sponsored data service more valuable for advertisers, the end customers are incentivised to watch the adverts by real-time rewards and the operator is delivering another value-add service to advertisers and consumers alike.
The net result is a more valuable service proposition for the operator, strengthening existing customer loyalty and creating differentiation with which to gain and retain new customers.
The ability to innovate is here and now, and operators who seize the opportunities will reap the rewards.