Rui Paiva Rui Paiva CEO - WeDo Technologies

Featured Blogs

Monetization - not seeing the forest for the trees

  • ‘Monetization’ may soon become the most over-used word in the telco industry after ‘convergence,’ ‘agility’ and ‘enablement’! Today, it’s all about decreasing voice revenues and increasing data usage, OTT players pinching pennies and operators cutting costs, capex reduction and cutting throats (well maybe not so much of the last).

    Monetization of anything not currently being monetized is seen as a saviour to some, but it’s not quite as easy as it sounds. For a start, trying to charge customers for something they have been getting for nothing is close to impossible. It is the quickest way to get them to lose your trust and go to a competitor.

     

    monetization

    Freemium models are probably not much better. You dangle the baited hook and as soon as they bite you hook them and charge them for the privilege. Like a fish, they eventually remember the routine and avoid the bait, hook and all. That’s presuming, of course, that you even remember to charge the ‘premium’ after ‘the ‘freemium’!

    Whilst every online business, including telcos, is looking at maximizing monetization, every customer is trying to minimize it – or demonetize! If they can get something for nothing, no matter how difficult or dangerous it may be, legally or otherwise, a very large percentage of the population will go for it, not just to save money but also to revel in beating the system.

     

    CommsDay recently reported that “while mobile operators are struggling everywhere to monetize traffic from over-the-top content providers, Google is moving to meet them halfway, at least in emerging markets where smartphone usage continues to be low.” It seems Google has launched a service called “Free Zone” with Philippines mobile operator Globe Telecom, that now enables users without data plans to access Google services. With “Free Zone” users can tap Google search, Gmail, and Google+ services from their browser for free without paying any data charges, as long as they set up a Google account and sign in.” But if they decide to go anywhere else the meter ticks over after warning them they were entering chargeable territory.

     

    Is this simply another teaser, just like the ‘free access to Facebook’ model that took Indonesia by storm three years ago? It didn’t take long for every operator there to copy the XL model, but who knows if it is generating extra data revenue or just generating loyalty. That raises the question on just how much loyalty is worth. If you have a loyal customer for ten years, but he doesn’t actually generate viable revenue, let alone profit, is it worth keeping him?

     

    This was raised a while ago in another blog by Tony Poulos on TelcoProfessionals called ‘Dumping the Dudders’ asking the question why big data is not used to determine those customers that may be costing you money and would be better off in arms of your competitors. Catering for the masses is a costly exercise, after all. Wouldn’t catering for a smaller ‘monetizable’ community bring cost savings in infrastructure and business systems capex, too? Better ‘monetization’ of those would be a good starting point for many operators, judging from the level of stranded assets found in most early business assurance exercises.

     

    In fact, an operation that has introduced any form of revenue or business assurance is well on its way to ‘monetizing’ all of the above. Who needs ‘big data’ analysis when the key business data relevant to all things monetary is already at their fingertips. Makes you wonder sometimes if we are not seeing the forest for the trees.

    Rui Paiva
    About Rui Paiva Rui Paiva works as CEO at WeDo Technologies
    More information : www.wedotechnologies.com