By Yassuki Takano *
The discussion about the relationship between telecommunications operators and so-called "over-the-tops" (OTTs) - social networks, communication and media applications, among others, that provide services over telecommunications networks, has been going on for some years. many of the services offered are similar to the services originally provided by operators (such as voice calls, text messages or video).
This (supposed) conflict has brought up several issues - such as revenue capture by OTTs with less regulation or need for invested capital, privacy or encryption issues - and it seems far from over.
But, there is another perspective of this relationship that has been little explored: the potential symbiosis between operators and the over-the-top - also including apps and other technological partners of the operators - in terms of capturing and enriching the data that travel on the operator's network and creating new services and marketing them.
Much is said today about the valuation of technology companies (eg Google, Facebook, Amazon) due to their ability to capture and analyze data from their users, in order to model and predict purchasing behaviors, improve service quality and generate new business. Today, we do not have an operator in the group of these large companies, but they are in a strategic position in this scenario, since all the traffic to access these digital giants goes through the connectivity provided by the operators.
More than that, if we analyze in detail the possibility of capturing user behavior data, telecom operators are in a position where they would be able to understand their behavior as much or even better than OTTs. With the premise of respecting data privacy, dealing with clusters of users and not individuals, for example, an operator can analyze the location, navigation profile and use of apps, audience of TV channels, etc. We would not be exaggerating to say that a telecom operator is currently the closest service provider present in an individual's daily journey and that, therefore, he would have the ability to better understand his behavior.
And this coverage expands even more when we think about possible data partnerships, whether considering existing services, such as card acquirers (which have visibility of how much was spent and at which point of sale), or, in a more futuristic perspective, credit card services. internet of things, like connected cars, "home automation" or other services that are still being developed. Anyway, the operator is in a privileged position, as the link between several elements, becoming a very valuable source of data and information for sectors such as retail, media, logistics, etc.
Some examples that we can cite to illustrate these new services are the analysis of navigation preferences for better targeting of advertising, or the elaboration of heat maps based on the movement of users. These services could be consumed by advertising agencies (digital or not) and companies that would like to position physical points (kiosks, stores, agencies, etc.) considering the public traffic nearby.
The market does not yet know how to use this new information potential very well, nor does it price it. Especially because the supplier side - the operators and their partners - is still in a very embryonic stage of structuring these services. To a greater or lesser extent, operators have moved to "monetize" their data. And from this perspective, the more OTTs, apps, service partners, IoT partners and others are in the operator's ecosystem, the richer your data and the more value your information will have.
It is a complex task, as it involves the consolidation of data from numerous bases, the creation of new services in the nature of prototypes to be tested, in addition to constituting a totally new market and a totally different way for operators to do business. It is a typical example of an innovation dilemma, in which it is necessary to incubate a new business model, initially much smaller than the core business, but with enormous potential, and also to convince the market of this potential and of the company's viability and capacity for transformation.
On the other hand, the market has already attributed a very positive value to technology companies due to their potential ability to manage this large volume of data and transform it into valuable information. The partnership between operators and OTTs, in this context, seems to be a huge opportunity. In this perspective of data enrichment and understanding of the market, the more apps, the more partners, the more OTTs, the better for the operator. And an old rivalry comes to be seen as a partnership.
We are facing an opportunity, as great as it is challenging, which is the possibility for telecom operators to structure themselves to capture, analyze and be able to develop new services from all the volume of data and information that travels on their networks. It seems to be an interesting way to deviate from a positioning as a mere connectivity tube, but it also has its obstacles, such as the challenge of delivering benefits to companies and users without hurting aspects of privacy, in addition to the complexity of orchestrating the numerous areas and partners.
And let them roll the dice, literally!
* Yassuki Takano, Logicalis Consulting Director
Warning: The opinion presented in this article is the responsibility of its author and not of ABES - Brazilian Association of Software Companies
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