Wednesday, February 27th, 2013 - OVUM

Please find below Ovum's analysis of announcements from SAP, GTI, Telefonica Digital, + Blackberry and O2.

For further analysis or for an interview with Ovum, please contact Ovum’s press office on +44 20 7017 7916 or email [email protected]

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SAP confident with its telecoms portfolio

Clare McCarthy, telco operations analyst, Ovum

SAP’s nine announcements before and at MWC 2013 have included optimizing inventory and service levels in the supply chain, money transfer solutions for mobile operators, and cloud-based M2M solutions.

“It is interesting that a non-telecoms company such as SAP has chosen to make so much noise at MWC. SAP, along with other independent software vendors (ISVs), sees the telecoms industry as another vertical to mine. The ISVs’ horizontal portfolios and business process management can provide the solutions that telcos need to become more agile. SAP is confident in its offer, and has already published a book – Beyond Connectivity: A Guidebook for Monetizing M2M in a Changing World – that is designed to help monetize M2M. Now, SAP has joined with Ericsson to provide a solution to help telcos execute that advice. Ericsson has been astute when joining with companies with software backgrounds to enhance its portfolio, and this combined software-as-a-service offering promises turnkey M2M solutions that telcos’ enterprise business units can then offer to their customers. The solution already has endorsements from Telenor and 3UK, so it is clearly fulfilling a market need.

“We know that the telecoms industry still gets excited about new devices, the next superfast infrastructure, and the money involved in spectrum auctions. However, we can’t stress enough that innovation happens in the telco’s software. The industry shouldn’t overlook the importance of announcements from ISVs as this is where sustainable value is being created and where the real changes are happening.”


The GTI has succeeded

Daryl Schoolar, network infrastructure analyst, Ovum

The Global TD-LTE Initiative (GTI) was formed in 2011 to promote the interoperability between LTE FDD and LTE TDD. A secondary goal was to ensure that LTE TDD wouldn't be a Chinese-specific technology.

“Undoubtedly, China Mobile's ongoing network rollout (which is expected to exceed 200,000 base stations and cover more than 300 million people by the end of 2013) is important to LTE TDD’s success. However, China Mobile now has many allies in this effort and the GTI can claim that it has succeeded in achieving its goal.

“This year's GTI conference, held at MWC 2013, was a who’s who of mobile ecosystem players. Samsung, Qualcomm, Ericsson, Nokia, and Nokia Siemens Networks all spoke of their support for the technology. There was even mention of Verizon Wireless wanting multi-mode LTE smartphones to enable roaming with China Mobile and other LTE TDD operators. LTE TDD operators can now be found throughout the world, including in Poland, Sweden, Saudi Arabia, Japan, and, before the end of 2013, in the US.

So if the goal of the GTI was to ensure multi-mode LTE support and a global ecosystem, there is no doubt that it has succeeded.”


Telefonica Digital believes it has a data mining opportunity equal to OTT rivals

Eden Zoller, consumer analyst, Ovum

“While Google has the search graph and Facebook has the social graph, Telefonica Digital says that it has the voice graph. At a Telefonica Innovation briefing at MWC 2013, the operator spoke about a project uses a linguistic analysis engine to mine and analyze call data. Among other things, the engine can be used to track call location and duration, which is useful for measuring the impact of something such as an event in a certain area. 

“However, a far more controversial aspect of the project is the analysis of personal calls. Telefonica’s linguistic analysis engine can extract information about a caller’s personality and preferences based on the tone of their voice. Telefonica claims that it has a team (which includes psychologists) that can construct personality traits with 80% accuracy based on the call analysis. This level of insight would clearly be of interest to advertisers and organizations in sectors such as tourism.

“Telefonica is keen to stress that it does not look further inside a call beyond a user’s tone of voice, that its approach is based on opt-in consent from the user, and that the whole project is purely internal at this point. Ovum believes that a commercial launch for the project is likely to be challenging. Telefonica’s linguistic analysis engine provides a deep level of granularity, even without listening to actual conversations, and we think that consumers will be very uncomfortable and resistant to the idea. Consumers are increasingly concerned about how their personal data is exploited, which in turn is reflected by mounting regulatory scrutiny of this issue. All of these issues are explored further in Ovum’s recent report Personal Data Futures: The Disrupted Ecosystem.” 


BlackBerry powers Indonesian mobile money initiative

Angel Dobardziev, customer insights analyst, Ovum

“BlackBerry, Monitise, and the Indonesian financial institution PT Bank Permata today announced the launch of BBM Money in Indonesia. BlackBerry is the leading smartphone brand in Indonesia and its flagship messaging service, BlackBerry Messenger, is extremely popular, especially among younger consumers. There is also a very large segment of unbanked and underbanked users in Indonesia. As a result, combining BlackBerry’s customer franchise, Monitise’s strong mobile money platform, and PT Bank Permata’s banking expertise looks like a winning partnership – but is it really?

“We think the jury is out. There was little in the announcement on the agent network that will support the service other than the use of PT Bank Permata’s ATM network. As unbanked users typically cash in and cash out a lot when they first sign up to a mobile money service, a number of players have found it difficult to gain traction if an agent is not close by to help users send or receive transactions.”


O2 adds colour to the German LTE market

Steven Hartley, telco strategy analyst, Ovum

“O2 is set to launch new tariffs for its German LTE smartphone customers from March 1, 2013. These follow the current pattern for unlimited voice and messaging, showing the increasing importance of data to the mobile proposition.

“O2’s pricing is good value compared with its rivals. However, a direct comparison of O2’s new German tariffs with those of Vodafone is difficult because O2 is selling the handset separately, whereas Vodafone bundles the cost with the plan. However, comparing the total cost of ownership over the life of the two-year contract highlights O2’s competitiveness.

“For example, O2’s Blue XL tariff costs €1,740 over two years, which includes unlimited voice and messaging and 5GB of data per month. In comparison, Vodafone’s Red Premium tariff costs €2,880 for unlimited voice and messaging and 10GB of data per month. O2 may be offering less data, but as the fourth-largest player in the German market it needs to be disruptive and is using pricing as the lever.

“Interestingly, both plans provide additional SIMs for use in other devices. Ovum believes that the shared data plans, where data allowances can be used across multiple devices, will become an increasingly important model for mobile broadband in the future. While O2’s data allowances are not particularly generous for such an offer, they are at least a start.”




For further analysis or for an interview with Ovum, please contact Ovum’s press office on +44 20 7017 7916 or email [email protected]

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Jointly awarded IIAR Global Analyst of the Year 2012, Ovum provides clients with independent and objective analysis that enables them to make better business and technology decisions. Its research draws upon over 400,000 interviews each year with business and technology, telecoms and sourcing decision-makers, giving Ovum and its clients unparalleled insight, not only into business requirements but also the technology that organizations must support. Ovum is an Informa business.
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