New Business Models Feature Editorial

Redefine Telco Business Models to Realize Hidden Network Value

By David Sims, TMCnet Contributing Editor

Remember 10 years ago? As a telecom, your value chain looks a little different today, doesn’t it? Today you have far more third-party application developers and content providers coming up with all kinds of cool new apps, there are video and other Web capabilities you customers want.

 

How to use all that to stand out from the competition? Why don’t you take advantage of your high-value network capabilities to “foster open innovation with an ecosystem of application developers and content providers,” in the words of a recent Alcatel-Lucent (News - Alert) study?

 

You, the service provider, have a rather irreplaceable role in today’s value chain. Alcatel-Lucent has produced a number of white papers and research studies showing that application developers and content providers are willing to pay for access to your high-value network capabilities.

 

Yes they will – it “gives them better contextual information for more effective targeting of their applications and content,” Alcatel-Lucent has found. They know what that’s worth, they value it, and they’re willing to put their money behind it.

 

“Working with an application developer and content provider ecosystem accelerates time-to-market, improves your ability to target niche markets, increases your relevance and generates non-subscriber-based revenue,” the ALU research has found.

 

Alcatel-Lucent provides high leverage network architecture, if you’re looking to beef up your ability to provide more high-demand Web capabilities to more screens.

 

Another avenue they offer, which you might want to take a look at, is the Alcatel-Lucent open API Service. This gives application developers fairly simplified access to high-value network capabilities, such as location and end-user preferences, through common APIs based on industry standards.

 

What this means is that developers can write differentiating applications that work across service provider networks, without having to navigate complex APIs or business agreements. Much simpler and faster all around: “And service providers gain a business model that increases and monetizes network traffic without the expense of a developer program,” Alcatel-Lucent concludes.

 

Of course what works for one provider might not work for you; this isn’t cookie-cutter economics. Search around and find what fits your role, ecosystem relationships, revenue models and key success factors. And then take a look at the Alcatel-Lucent research on emerging business models and see what works as the best approach for your market strategy and reality.

David Sims is a contributing editor for TMCnet. To read more of David’s articles, please visit his columnist page. He also blogs for TMCnet here.

Edited by Erin Harrison