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Wednesday, May 09, 2012

Telefonica TU Me - first salvo in full-scale interoperator Telco-OTT warfare

Regular readers of this blog will know that I am a big believer in operators developing their own OTT-style services. I published the first full analyst report on the Telco-OTT concept it a few months back, and conducted the first public workshop (summary deck here) about two weeks ago.

Telco-OTT offerings are not new - I've found over 100 examples, split between four broad categories of Communications, Content, Connectivity and Cloud. Some have been around for a decade or more, and I am adding more on a weekly basis. I've also been engaged in numerous private consulting projects and workshops, some for major international operators looking for a disruptive play.

One thing that has been absent so far has been any large-scale "operator-on-operator" battles for VoIP and messaging. No operator has really gone out to create a complete Skype / Viber / WhatsApp / Facebook from scratch, especially rolled out globally to the entire 2-billion strong Internet user base. There have been some regional plays for Telco-OTT VoIP in Asia, and innovative fixed-onto-mobile or niche/OTT-extension plays such as Rogers One Number and "roaming VoIP" plays from operators like Mobily and Cellcom. T-Mobile US's Bobsled is a customised version of Vivox's VoIP platform, but hasn't really got the same sort of scope and scale.

This has all changed with today's formal launch of Telefonica Digital's TU Me application, which is a sort-of combined Viber+WhatsApp with a unique "timeline" format for communications, which is stored in the cloud. It works over WiFi and 3G/4G data, but is currently only available on iPhone.

Various things make it unique. First off, it's an Internet-centric app with plain-English terms of service, no support for emergency calling, no (at the moment) TUMeOut or TUMeIn interoperability with the PSTN, and no interworking with SMS. It's not intended for "primary telephony replacement". It's also - uniquely for a telco proposition - unashamedly a beta "work in progress" app. It crashes, it's only available in English, the ToS basically says "If it doesn't work, sorry". Caveat emptor. (Caveat utilor? It's free at present).

Yes, there are various other VoIP/IM apps out in the wild that do broadly similar things. But apart from Skype and Google Voice, they're not run by companies with 300m+ existing users to whom they can evangelise and bundle. Telefonica also ought to have some cost advantages, as it's got its own cloud platforms and back-office capabilities.

Also, and what is surely causing some bulging eyes today, it's come out in advance of Telefonica's RCSe / Joyn launch. It wouldn't surprise me if there's a (politically-calculated) plan to interwork with RCSe at some point, but that's just paying lip-service to the old and out-moded federated approach to telecoms.

The other interesting thing is the apparent business model. It looks to me as if Telefonica has adopted cloud-based models for a communications-based service. It looks as though it may charge for hosting the "timeline" beyond a free first year, and I bet it does a bunch of other cloud-based clever functions around the voice and messaging content - perhaps recording, analytics, translation, seach and so on. This fits with my view (and the trend accelerated by WebRTC) that the actual business of shipping bits of speech or text around is moving down to become a mere function, not a service. Monetisable services will be what happens around voice or messaging.

I'm expecting to see various other operators enter the Telco-OTT space, either with other "big" plays like this - hopefully differentiated - or with niche offerings targetting travellers, voicemail, particular groups etc.

But for now, I've got to applaud Telefonica for putting TU Me out there - it validates a lot of what I've been saying about Telco-OTT, and makes me feel less like a lone rebel shouting into the wind.


Mark said...

Makes more sense than the Joyn I saw at MWC. It's downloadable in the App Store and I don't need a Tfca SIM and so far it actually looks and feels decent.

juan said...

Mark, you can offer RCS-e/Joyn without SIM and also as OTT (whatever could register), I am sure more than one telco will offer it in the futuro. Protocols and technology used is the same: SIP, RTP...etc
Honestly, if every telco does the same and offer an app, poor batteries being drained and mobile proccessors suffering.
We worked a lot to help telcos to create a lot of differentation and services keeping a minimum set of common features, using cloud and APIs and do not understand if having 100 similar services with all the differentiation hardly embedded in the client is ok for the users.

Dean Bubley said...

Juan - what Telefonica is done here is precisely the right strategy.

Every telco *won't* do the same, and even if they do, probably only two or three will do it well. The rest will fail or be used in niches, which is entirely reasonable. Some will use SIP, others will use XMPP/jingle or proprietary protocols. That is also good as it adds diversity to the communications ecosystem - each will have its own strengths.

I'd also expect some operators will white-lavel Telefonica's or another leading #TelcoOTT or #InternetOTT app, perhaps with some UI customisation.

There is little value that I can see in a "minimum set of common features" - in fact, for some use cases, you may well want to go below that minimum, or invent them in different ways.

juan said...

Dean, Joyn can be also offered as OTT, you can provisionate service users in the database not based on MSISDN, I guess Tu Me is SIP based, with a core, etc etc.

IMHO, it is not about how to deliver the same creating lots of silos doing the same things, it is about how to use the messaging to create in an open way services and use cases using that set of features and put the personal communications in all the screens. How to use the rich messaging (whatever technology it would be based or whatever name it could have) as a platform (as in the past the SMS), an alternative access way to the services complementing the mobile web and the downloadable apps.

There are people that are not willing to download one app for each case and receiving 20 updates requests each week, but they do will to have easy to access services. We think this need may be addressed.

Perhaps some telcos are sharing this big picture about Joyn must be, let's see if they could implement it properly and soon. Be patient :-)