1 second billing: Telecom Trends

Comment

Comment by Murali on November 27, 2009 at 6:11pm

Interesting opportunities here. As Valeri mentioned it is not a MBP trend but rather a transition to microlevel trend. That apart can we even beat the zero time limit and "earn" money for making a call...Without sounding like a ditter, last I heard Virgin already has a plan like this.

Comment by Raghavendra Kulkarni on November 26, 2009 at 6:04pm

Hi Murali,

I wanted to comment on this long time back but could not since I was totally unaware of mono-bi-poly trend then. Keeping that aside, I wanted to share my thoughts on your first question "Is one second the ideal limit or can we even go to zero? How?"

The telecom market in India has become very competitive and with the coming of two new players
soon(Teleneor & Unitech), there can only be a war now & everyone will try to do different things now and we are seeing that(latest one being Airtel slashing roaming rates, rumours are sms is next!). Telecom companies started their business to make revenues from voice services as core business. But, if you have observed the current trend, non-voice services are slowly increasing. If I consider voice based services as core business for first S surve and non-voice based services as core business for second S curve, then can we say telecom market has moved over from first S curve and is now in the first half of second S curve? If so, voice based billing can go to zero if we consider the following aspects :
1)Currently, breakup of revenues between voice based & non-voice based is approx(75:25). If this is
reversed in coming years, then non-voice services can form the core business.
2)Reports from Gartner & ITP predict that there will be huge investments in mobile applications(One such report is http://www.itpreport.com/default.asp?Mode=Show&A=2120). Hence,there is a potential in non-voice business since everything we do online using internet can be done through mobile phone. The opportunity is that it hasn't yet picked so much in India and it indeed can be a market.
3)Telecom companies also have lot of subscriber data like which number they often call, what time do they call, is it a local or STD no and many such information. They can mine & analyze this data and come out with sustainable business decisions(like different plans for urban & rural customers, heavy data usage plan for corporates etc). Can they might end up making money just from non-voice services while they are providing both voice & non-voice based services just like Polariod once made money by selling films & not cameras, Apple made money by one or two products when they had invested on more products.

Let me know if this can make any sense!

Regards,
Raghavendra

Comment by Shankar MV on October 27, 2009 at 12:55pm

Hi Murali
It was great talking to you - we had great fun using TRIZ tools for your ideation on Girl Scouts - I look forward to more TRIZ sessions with you
Shanks

Comment by Valeri Souchkov on October 7, 2009 at 10:19pm

Hi Murali, absolutely no problem - in real life, many TRIZ trends can act together at the same time and sometimes they can overlap each other.
Consumer ideality is a complex factor and depends a lot of individual perception, habits, emotions, etc. Often there is no clear majority of consumers who would prefer one model over another, and therefore market can be segmented horizontally and not vertically. That's why governments must not serve a role of a "superior guide" but provide ground for fair competition and freedom of choice.

Comment by Murali on October 7, 2009 at 4:32pm

Thanks Valeri, my bad identifying it as a MBP trend.
I agree with you on the ultimate objective towards giving the freedom of choice to consumers,
and every customer has his own definition of ideality.

Comment by Valeri Souchkov on October 7, 2009 at 4:17pm

Hi Murali, it is not a "mono-bi-poly" example, but it is example of the Trend of Transition to Microlevel, often known as segmentation. Under specific conditions, we can gain more control and make our system more ideal by fragmenting physical objects, or flows, or information, or replacing physical objects with fields.

There is always a limit in how much segmentation we want. It can be either physical limit or meaningful limit. For instance, in your example it will be a time interval during which we can submit and receive the smallest amount of useful and meaningful information, say - one word. Probably, one second is a rough approximation of this interval.

As Bala rightly noted, introduction of "flat rate" business model solves a lot of technical problems for operators and makes customer expenses predictable. Seems like to be a better model but not exactly. Flat rates are great for those who speak a lot. But there is another side: many customers who do not speak much want to be billed exactly but they still want to have all the benefits of monthly plan models. Thus the flat-rate model does not meet their demands. Therefore we have both models on the market today.

We can also observe such transition to microlevel in the other areas, for instance, utility services. In the past, in many countries people paid flat yearly rates for gas, water, electricity no matter how much they consumed. However today almost every house or appartment has counters installed and are billed for exact amounts. Although in some cases it is still possible to use flat rates, usually you will pay more than less.

Ultimately, with their regulations, governments should create a freedom of choice for different customer groups and not abandon one model in favor of another, and it should be a matter of technology suppliers/providers - to develop most ideal solutions to satisfy each market segment. Although of course governments can support those models which bring most value to both customers and suppliers - at the end of a day the governments will benefit too.

Comment by Bala Ramadurai on October 7, 2009 at 11:24am

Good analysis Murali, my immediate reaction is : well, ideality is do the function, but has no weight, space, maintanence or labour. Billing still requires one or more of the above. Ideal billing is when you pay up and speak as much as you want. zero effort in billing for the service provider, infinite talk time for the customer.

to an extent GPRS or data is closer to ideality on that front. There is unlimited usage for a fee (of course, it is valid for 24 hrs).

One more way to looking at this is Govt regulations create pathways to ideality for the end customer.

Isnt it one of Govt regulations that receiving calls is free in India? (another ideality for the customer provided by the Govt)

Bala