SKT, DoCoMo eye expansion via mobile content

Caroline Gabriel/Wireless Watch
08 Jul 2013

There is a growing trend for operators to launch services which run on rivals' networks, as they seek to fend off web rivals by going over-the-top themselves.

Most have focused on core cellco applications like voice – as seen at T-Mobile USA's Bobsled, Orange's Libon and Telefonica's TuMe - but the Asian carriers in particular are opening up applications and content to all-comers. And some are looking to use these platforms to establish bases in markets where they have no networks, as seen in SK Telecom's latest attempt at a US position.

NTT DoCoMo of Japan has decided to open up all its internet-based content services – music, games, video and apps offered on its “dmarket” site. Currently, these are only available to DoCoMo customers and purchases are charged to the customers' bills, but DoCoMo will now add other payment options such as credit cards.

There is a risk in opening up the services walled garden so decisively, and the rules of competing in the OTT world are very different. However, only by addressing the whole population can carriers in saturated markets, with limited growth potential in their own base, continue to boost revenues and brand awareness.

Scale is everything in the web, as Orange R&D's Giles Corbett, who heads the Libon team, said in a recent interview: “Either you get scale quite rapidly or you don't. It's got to be millions very rapidly, and growing into tens of millions.”

Scale relies on free services and on the carrier‘s brand power, while revenue will come from premium services – tough to sell, but perhaps less so when they can be bundled with existing deals, another advantage over pure OTT players.

DoCoMo and a few other players are also looking to use their over-the-top services and brands to attract users and web-based revenues in markets where they do not operate networks. Orange, Telstra, Telefonica and others are adopting this strategy, often to establish beach-heads in emerging markets, but the most aggressive of all is SK Telecom.

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