Welcome to the latest edition of Telco 2.0™ Update, the newsletter of the global Telco 2.0™ Initiative:

• 3GSM - CEOs say 2007 is ‘Year of the Business Model’
• New Telco Business Models - A Map to Guide You
• Telcos Role in Advertising - Time to Get Serious
• ‘User-Generated Content’ & ‘Social Networking’ - Lessons from Three UK & o2
• ‘Free’ is the new ‘Premium Content’

3GSM - CEOs say 2007 is ‘Year of the Business Model’

For the Chinese, 2007 is the Year of the Pig. For Hamid Akhavan, CEO of T-Mobile International, it’s the Year of the Business Model, or so he suggested in his keynote at 3GSM in Barcelona last week. Arun Sarin concurred, talking about the need to play in adjacent markets. What’s good about these public announcements is a significant shift in approach: from rent-seeking to value-creation. What’s still problematic is the underlying mobile broadband model, the practical impact of the ‘de-layering of service and connectivity’, and the seeming lack of interest in innovating in core voice and messaging… (More)

New Telco Business Models – A Map to Guide You

If you’re heading to a new world, navigation is everything. The Vikings made it across the Atlantic without really knowing where they were going or where they’d got to. The Telco 2.0 Business Model Map is a new effort at working out what to do about the tectonic forces colliding the telecoms, media and technology industries, and ripping apart connectivity from application services. If you’re a telco exec or vendor, and are worried about structural change and Internet encroachment, this map should be very useful to help clarify: the shape of the world, where the land is, and which way is up... (More)

Telcos Role in Advertising – Time to Get Serious

If telcos want to build an advertising market which will add 10% to their revenues (as indicated by respondents to our recent survey) then they need to create a new industry worth over $100 billion! The disconnect between the massive theoretical opportunity and the current fragmented approach is significant. Consolidated Internet platform players (Google, Yahoo!, MSN) have created a valuable and growing paid search and banner market on-line but operators receive breadcrumbs because they remain fragmented minority-players and add little value. Operators need to unite around a common platform that leverages their assets and treat advertising as a core, rather than peripheral, part of their businesses… (More)

‘User-Generated Content’ and ‘Social Networking’ - Lessons from Three UK and o2

We heard CEOs at 3GSM pronounce that ‘User-Generated Content’ (UCG) and ‘Social Networking’ were two key areas that the industry had to explore, and fast. But who’s really doing anything commercially effective today? Three UK’s SeeMeTV and O2’s LookAtMe! – which allow users to make money from their MMS video clips - are seen as poster children for ‘mobile web 2.0’. They have become the leading portal services for their owners. Much more than ‘YouTube on the mobile’, these services effectively leverage the true assets of mobile networks and offer significant opportunities for growth. We met the people behind them at 3GSM to discuss the key lessons… (More)

‘Free’ is the new ‘Premium Content’

The ultimate high-margin premium content is an international roaming call, and anything that provokes one — even if you need to forego some revenue to create the stimulus — is a net positive. For our forthcoming Consumer Voice & Messaging 2.0 report, we’d been planning a section on “The end of pricing plans as the focus of competition”. In doing our research, however, we’re coming to the opposite conclusion: there’s lots of mileage left in mining out pricing. It’s just buried deeper. Rather than entering the content business, telcos should be milking the high-margin voice and messaging products right under their own noses… (More)

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© STL Partners 2007