|
|
|
|
|
Operators Seek To Profit From High Speed Mobile Broadband
Published Jul 21, 2011
|
LTE technology is widely seen as the next big thing in telecoms and the mobile broadband sector in particular. However, while an LTE network can greatly enhance mobile broadband speeds, questions remain about how operators will be able to generate revenue from the emerging technology.
With telecom markets changing so rapidly, operators are finding it increasingly hard to stay ahead of the game when it comes to developing new sources of revenue. "We are living in a market where we have a young population, where the population is growing and where customers are becoming much more sophisticated," says Hadi Raad, principal, Booze & Co, Lebanon.
As the market evolves, major telecoms in this region are being forced to look at newer and better ways to market products such as LTE to this generation of consumer. "Looking at this from a customer's perspective, they have a set of desired outcomes. We need to look at these desired outcomes and make sure LTE meets them," states Ahmad Abi-Zannad, strategic planning director, Leo Burnett Riyadh.
"You cannot help but talk about Generation C, the generation that needs to connect, communicate, create and change. They have been raised with certain aspects of life that they take for granted and LTE is a platform to help them do that. Generation C likes to discover it all, likes to participate, likes to create, likes to share, they have their own virtual life and they like to chat so if we want to convince them to buy higher speeds then we need to show them how these higher speeds help them meet these desired outcomes."
LTE marketing should have emotional appeal
A term which is being mentioned regularly in this discussion is emotional appeal. It is thought within the industry that the telecoms sector is not doing enough to provide customers with more than just numbers to showcase their products and services.
"Other industries with top notch technologies manage to do the emotional appeal part of it. If we look at the automobile industry, we do not see Ferrari or Porsche just talking about the fact that their car can go from 0-100 in three seconds, there is an emotional appeal to the brand. This is where telecoms operators fail in doing that. We need to learn from other industries. With LTE this can be done," Abi-Zannad says.
Other sources of revenue for telecom firms could come from content production. However, there are those within the industry who believe that content is not going to be a major source of revenue. Jack Hakimian, group strategy director, Zain explains: "Content is always going to be a revenue sharing game with other players. We are in the business of connectivity and this is going to remain the core of the business for a long time."
On the other hand, some operators are beginning to branch out into content creation, although not directly. "We need to find a way to localise our content. One approach is if you can't beat them join them. A company like us have started investing in other social media companies. In that aspect we are also trying to get into the market with a different revenue source. It has to be a combination of things," says Sammer Geissah, VP, network development, Du.
LTE offers many benefits for users
LTE does provide a huge boost in mobile broadband speeds and this can benefit users in different ways. In a country such as Bahrain where fixed broadband speeds are low, users may be attracted to the idea of using LTE mobile broadband all the time through dongles.
In other countries it would simply open up more possibilities with regards to applications and uses of internet access on the move. However, some believe that right now there are not enough applications to justify the jump to the faster speed, thus minimising the demand.
"There is a simple lack of applications that require higher speeds," says Zain's Hakimian. "Right now why would you pay more when you need less? The cream of the crop of subscribers requires high speeds. Still if there aren't a large number of applications that need higher speeds then you are going to struggle to attract the customers."
Whether it is this year or in five years, the move to LTE appears to be inevitable. The mobile apps and content creation will be ramped up in response to widespread adoption of LTE, rather than in anticipation of it. So from now until then, the main challenge for operators will be the marketing of what could be a game changing technology adoption.
"The major issue with telecoms operators is their preoccupation with technology. LTE is a premium product, and for customers to pay the premium for a product they need to see the emotional appeal of it. If we call it LTE, to them it's just another function," Abi-Zannad concludes.
Posted by
VMD - [Virtual Marketing Department]
|
|
|
