The mobile business industry panel tackles topical issues

The mobile business industry panel tackles topical issues

QUESTIONS  and answers
Was the iPhone worth the wait? Would you want one yourself?

Alexander, MoCo: With the amount of hype surrounding the long-awaited launch, I was dubious that the iPhone would be able to live up to its publicity; but I have been pleasantly surprised. The design, menu and features of this phone are fantastic, and yes I would love one.
The question that I am really interested in is: will the mass consumer market want one? With the launch of the Nokia N95 with its 5mp camera, MP3 and MPEG4 player, etc., I am not sure that it will. The missing elements of 3G and a flash also mean that it’s probably worth waiting for second generation iPhone device to appear.

Heeran, Valista:
For me, it was something of a disappointment. From a styling perspective it looks fantastic, as you would expect from an Apple device. As a music player it will no doubt be everything we expect from the maker of the iPod. As a phone, however, I think it has some issues.

The lack of 3G is a big factor and WiFi is not a suitable replacement – hopefully the European version launched later this year includes 3G.

In addition the inability to install third party applications and lack of a keyboard are factors against it for me – along with the very high price. Given that the price is in addition to a two-year contract (in the US) it seems too expensive. I suspect the price will be an even bigger issue in Europe, so it will be interesting to see Apple’s European launch strategy. For now though, I won’t be queuing to buy one.

Riddell, O2:
The Apple iPhone is an attractive handset, though the product is not expected to be launched until Q4 this year. Of course, other manufacturers (like Sony Ericsson and LG) are working on great-looking and highly functional MP3 phones too, so iPhone won’t be the only iconic handset on the market …

Seaton, Airwide: Writing this in the run-up to 3GSM, it certainly seems the case that music on mobile phones is set to be a major discussion point over the coming days.

Not only are we hot on the heels of the iPhone launch but soon operators, with the help of the software firm Omnitel, will be able to offer consumers unlimited access to more than one million songs for a small weekly fee.

However, the challenge for the iPhone and similar rich-media handsets will be to ensure that these new capabilities are developed without compromising the core functions that have powered their growth – voice and text.

Fulfitt, JAG:
I am a bit surprised about all the hype. Yes; it is a nice looking device. Yes; it has some great features. Yes; I will probably have a play to see if it’s worth replacing my current iPod. But it’s still nearly a year away from sale.

In that time the other manufactures have some good handsets that will compete in the same market. More and more manufactures are looking at making integrated devices that offer a one-stop solution. The networks looking for additional revenue are no doubt keen on these types of device. However, whether come December the iPhone will be worth the wait will remain to be seen.

The other factor in the iPhone’s success (or otherwise) is the price point. With a higher selling price, coupled with a launch at a time of year that is dominated by pre-pay, has Apple lessened its chances of a runaway success?

Is the average retail assistant under trained, underpaid, or both? Or neither? What if anything should be done about the situation?

Alexander, MoCo:
From experience both in the industry and as a consumer I have always found the retail channel highly enthusiastic and energetic – which would suggest that the target driven pay structure is working.

However after spending a wet Sunday afternoon at my local shopping mall conducting market research, I was amazed at the lack of knowledge and understanding of anything related to data (specifically Blackberry and Internet connectivity). My research spanned the network retail outlets and demonstrated that although the staff were handset-driven they had not understood the features and benefits behind the devices. The result of this was a number of bumbling conversations around push email.

Conversely, I have been encouraged by the independent channel. A recent visit to train our top 10 retail stores in data products demonstrated that although the technical knowledge needed improvement the key features and benefits were firmly embedded into the retail assistants and their incentives certainly reflected their enthusiasm for the products.

Cave, O2:
Retail service from the mobile industry is improving, but there is much more that can be done. At O2, our view is that to deliver the best possible customer experience you have to build a loyal employee base of people who are not only satisfied in their jobs, but also proud to work for you. We place a lot of emphasis on recognising and rewarding our people in order to provide a great employee experience.

Nash, Elite Mobile:
I’m not in a position to discuss the salary aspect, but as far as training is concerned the evidence is that this can vary enormously. We expect assistants – even those working part-time – to have at their fingertips the key features and selling points of every product in a complex and constantly changing range of electronic equipment.

Clearly, training should be paramount. Which means a training culture needs to exist right at the heart of the individual store or retail group. And it has to be driven from the top. That said, there is much that suppliers can contribute – and to increase sales of their own products it is obviously in their interests to do so.

Supplier-supported training, in conjunction with stores themselves, can be carried out in person, by providing print materials or, as is increasingly the case, it can be web-based. Working closely with store management, it means suppliers need to be flexible enough to formulate the methodology that’s most appropriate to each scenario, in order to maximise business opportunities, and not insist on a one-size-fits-all approach.

Fulfitt, JAG:
Sales Consultants are normally paid by commission and in the main by the amount of gross profit that a sale makes; so the facility for them to earn the money is there. I have seen time and time again good sales people with no training but an excellent attitude to the job at hand, and these have far outweighed the people who have had extensive training but have completely the wrong attitude. Training is very important, and all companies should continue to promote a training scheme, but ultimately it is down to the person.

Does the future of the consumer mobile industry lie in free ad-supported contents, services, and networks?

Heeran, Valista:
I think this is partly the case, certainly for mobile content. One of the big criticisms levelled at mobile content is that today it just doesn’t provide value for money in terms of prices charged. With more and more customers looking at what they get free via the internet and wondering why they are paying for it on mobile, we will see an increase in content which is free or heavily discounted based on advertising models.

I am less convinced about the core mobile services. For core voice services I don’t see advertising being tolerated by consumers. This model has been tried many times in the past and it’s just too invasive. Allowing push ads to your phone via SMS or MMS in return for discounted voice may work as an alternative.

In general, providing consumers with a choice of full price services, or discounted based on ad sponsorship will be the model, and not forcing the ads on consumers.

Price, Avenir Telecom:
If ad-supported content and services are really going to take off in consumer mobile, the business model needs to work for everyone. The networks need to be able to demonstrate to their advertising partners that they can offer good ROI, not just in terms of brand awareness but also to provide additional revenue streams.

Most importantly, the fit has to be right for the customer if any results are to be achieved. Some consumers are shrewd enough to understand the benefits and accept the trade-off, but only for services that are really relevant to them and for which they have the choice to opt into. We have already seen this in parallel markets such as online marketing; another example is in the USA, where people will listen to adverts to receive free access to directory assistance.

However, the customer experience needs to be a priority at all times and should never be enforced. Such partnerships must provide added value to the mobile offering to enhance the customer experience and deliver tangible results for the both advertisers and the networks.

Alexander, MoCo:
The entire mobile industry is changing as the consumers are becoming more aware and demanding of the services they require. I believe we are already seeing the ‘free’ element of the mobile market changing with more consumers interested in services such as email on the move and internet access.

The ad-supported content/services proposition is all down to tolerance and choice. If consumers are given an option to turn it off they will and if the networks do not regulate the amount and type of advertising on devices then it may also drive consumers to consider their options more carefully. Radio, TV and websites have been promoting ‘no advertising’ zones for several years, but conversely they know that they can’t survive without it.

The ‘free’ ad-supported consumer sale will always have a place in the market. But the networks must appreciate how sophisticated and demanding each user is becoming and not underestimate their tolerance for ‘there’s no such thing as a free lunch’.

Burke, AdaptiveMobile:
With the emergence of 3G and HSDPA, bandwidth is no longer scarce, and thus no longer has value for the operators’ customers.

Understanding who the user is holds the true value – who they are, what they want, where they are going for content (and where they’ve been), and the context of their actions and activities. That knowledge is scarce, and thus has a value.

The issue for operators is that they see the consumer as their customer, but to invert this thinking and instead consider content owners and advertisers as their customers will enable operators to monetise this body of knowledge. The application of this information could be in the form of either advertising (and supported content) or in better directed, and more relevant, served content.

Riddell, O2:
The future is in delivering exceptional service to customers, whether it be network performance, products, services, content or after sales care. Mobile Advertising has the potential for delivering additional revenue streams but getting the customer experience right will be crucial.

Seaton, Airwide:
In theory, the answer appears to be that ad-supported content could become the model for the mobile industry. After all, it has become the dominant model for the internet. But looking deeper, there are numerous factors that are different in the mobile context.

First, mobile subscribers are likely to be much more sensitive to unwanted ads. While ads have attained nuisance status on a PC, on a mobile they consume minutes and battery life, take up most or all of the screen, and in some countries recipients are charged for incoming messages.

As in the internet world, if operators enable subscribers with effective spam filters and effective selection of content via opt-in and content control mechanisms, then ‘free’ ad content could move from the theoretical to reality. As the holders of vital messaging traffic, usage and subscriber information, operators hold the key to this market opportunity.

The Mobile Business Industry Panel aims to get views from leading figures on key topics. On the panel we have a selection of senior management from operators, distributors and retailers, plus a couple of industry observers and pundits. Each month we invite comment from some of them and we print the best/most interesting of their responses.

If there are any questions you think we should put to the panel just email them to us:

Director, Sales & Marketing, Elite Mobile
Director of Sales and Marketing MoCo Distribution
Head of Retail, O2
Scott Fulfitt
Operations Manager, Jag Group
CMO, Airwide Solutions
MD, Avenir Telecom 
Lorcan Burke
CEO, AdaptiveMobile
Head of Content, O2
CTO, Valista
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