The landscape for mobile application development has changed enormously. The entry of Web 2.0 companies means instead of consolidation, operators are now facing increasing fragmentation. The challenge for operators is how to manage this diversity from their own perspective. Which direction will offer the greatest chance of consumer adoption of mobile apps?

The current situation with mobile application development has been compared to the early days of computer gaming. Then, developers, faced with a multitude of choices, developed for the biggest selling devices or specialised on one particular vendor. At that time, the Japanese attempted to create a standard for mobile games, MSX, which failed. As Bill Weinberg, general manager with the Linux Phone Standards Forum, points out, this plethora of choice is an unnatural situation for the cellular world. The whole industry has been based on standards like GSM and GPRS. He argues that standardisation in mobile apps, if it occurs at all, will centre around software platforms.
Establishing exactly which platforms existing players are developing for and which they will develop for in the future isn't an easy task. In Europe, the main focus has been on two operating systems – Windows Mobile and Symbian – whereas Palm and Brew have proved popular in the US and Linux has made some impact in Asia Pacific. The difference, Weinberg maintains, is that Microsoft and Symbian offer very different value propositions. "Microsoft promotes Windows Mobile not just on its own merits, but as one end of a platform continuum that spans from server to desktop to embedded," he observed. "Conversely, the Symbian OS is an isolated platform but the company promotes it as the 'best-in-class' mobile OS. Both companies have strong developer communities – Microsoft claims to have over 1,800 apps that can run on Windows Mobile. They both have published strong APIs that aid developers in creating new apps."

Asked whether the latest initiatives by the Web 2.0 players can disrupt the existing OS duopoly, Paul Goode, senior analyst with researchers, M:Metrics, argued that, "The arrival of the Android / Open Handset Alliance is important, but is of little commercial interest for at least the next five years." He maintains that it takes a long time to roll out new platforms into the hands of consumers. "Microsoft launched Windows CE ten years ago but it still has an under two per cent market share in the UK of installed base. Indeed, smartphones as a whole only have just over 10 per cent," Goode said.

Java
Consequently those aiming to develop a mobile application for the mass market have followed another direction – Java. According to Tom Godber, founder of specialist Mobile apps developer, Masabi, "Native OS apps were stillborn; AJAX is fundamentally wrong for mobile, so – despite its flaws  – Java is the only viable option for advanced clients in the next three to five years." Bill Weinberg agrees. "Today the vast majority of phone apps are written in Java (J2ME and MID-P)," he says. "Actually, operators like NTT DoCoMo, Sprint, and Vodaphone all have their own developer programmes, but they mostly concentrate on Java." The catch is that Java itself is extremely fragmented. As Tony Cripps, a senior analyst with Ovum, observed, "Java certainly failed to live up to its promise [write once, run anywhere] in the mobile world." Similarly, "Even where there is a common 'standard', such as J2ME, the implementations are vastly different across manufacturers and often incompatible," argued John Chasey, CEO with software house, Metismo.

Linux
Few believe that even if Java has so far failed the mobile industry, Linux can come to the rescue. "As for the various Linux initiatives – such as LiMo and Android – there remains a large degree of fragmentation," Geoff Blaber, senior analyst with CCS Insight, commented. "The fact remains that we're yet to see a commercially successful Linux based platform in Europe. We'll probably see a small number of devices based on LiMo and Android this year [2008] but it will be sometime before we see a vibrant developer community for Linux."

Flash
One development environment which was mentioned frequently to Mobile Europe was Adobe's Flash. The argument here is that Flash already has a very strong following amongst those developing for the Web and that this great pool of expertise could be harnessed to create mobile applications. There is, of course a mobile version of Flash – namely, Flash Lite. However, Masabi's Tom Godber  isn't convinced that it will provide the answer for creating mobile apps. "Flash Lite is proving that any platform that can reach a mainstream user base will fragment. Despite having less power and fewer units shipped than Java, it has multiple incarnations and many handset-specific bugs, let alone the inescapable form factor issues." Tony Cripps observed that Microsoft has taken the whole challenge presented by Flash very seriously and produced its own alternative – Silverlight. This was released back in September 2007 for the Web community. Microsoft's Derek Snyder was unable to confirm just how soon we might see a mobile version of Silverlight. However, he did confirm that Silverlight was shown working on a standard Windows Mobile [6.0] handset by Microsoft at a developer conference. Reports appear to confirm that it was working well, so there shouldn't be too long a wait.

Thought leader
Another force to be reckoned with is Apple with its iPhone. Despite worldwide sales of four million units in 200 days, the iPhone is influencing mobile software way beyond its actual installed base. James Tagg, CEO with mobile VoIP provider, Truphone, described Apple as the "thought leader" in the mobile apps space. The same influence was observed by Shlomo Wolfman, COO with software house, Starhome. He claimed that the Windows Mobile developer community has recently increased its output – chiefly by imitating features offered by the iPhone and then translating them into Windows Mobile apps. Significantly, Derek Snyder, product manager for mobile communications with Microsoft, questioned just how effective Apple's approach was. If the iPhone really had succeeded in bringing the Web 2.0 to mobile phones, then why were web designers declaring that their sites had been 'optimised' for the iPhone, he asked?

Despite all competition, in terms of a winner in the mobile apps space, it is probably Nokia that currently dominates. According to Geoff Blaber, "From a an open platform perspective, [the Nokia] Series 60 is by far the most dominant platform in terms of volume, accounting for over 60 per cent of the European market." He also notes that Nokia's development community, Forum Nokia, is "a huge and highly comprehensive developer support program which has been central to driving growth of the Series 60 eco-system." So Symbian and Nokia could be viewed as the current market leaders. There is one drawback, though. Nokia has begun to develop its own web services under the Ovi banner and Blaber believes this could deter some Web 2.0 developers given that a potential conflict of interest exists.

Yahoo! Go
Generally speaking the arrival of Web 2.0 giant, Google, with a version of Linux in the shape of Android is viewed as increasing the fragmentation of the Linux developer community. "We'll probably see a small number of devices based on LiMo and Android this year but it will be sometime before we see a vibrant developer community for Linux," Geoff Blaber believes. "Portability of applications between platforms remains a big problem which inhibits growth of the developer community for mobile Linux." So what has attracted the fiercest criticism is Yahoo!'s claims that its 'Go' will allow third party developers to write applications that will run on a wide variety of mobile devices. Carsten Brinkschulte, CEO of mobile email specialist, Synchronica, commented, "Once again we see a big vendor heralding an 'open' mobile platform which is, in fact, proprietary technology that does not support common industry standards such as push IMAP and SyncML." Brinkschulte added, "In addition, Go mobile technology takes over the user interface of the device rather than working with the manufacturers' firmware." He therefore predicts that Go will meet with considerable resistance from the mobile handset manufacturers themselves. 

The entry of web 2.0 players into mobile is not a completely negative event, According to Paul Goode, the easy viral success of Web or PC based applications is hard to replicate in the mobile space. That viral capability increases the power of the consumer, of course. Tony Cripps also believes that 'widgets' make more sense in the mobile sector than they actually do on the computer desktop. Widgets actually require a small amount of processing power on the host device and leave the real processing to Web based servers.

Pulling the strings
Handset manufacturers aren't the only players seen as influencing the mobile apps market. Bill Weinberg feels that reference designs from handset chip suppliers and not the 'standard' commercial versions of software that will often form the basis for new mobile apps. Nonetheless, the vast majority of observers say that it is the mobile operators who are calling the shots in specifying mobile apps. There has, however, been a subtle move towards consumer choice and influence.  Geoff Blaber, for example, observes that, "Windows Mobile has to date remained predominantly business orientated from an applications perspective although this is beginning to change as vendors such as HTC and operators like Vodafone utilise Windows Mobile in more of a consumer centric setting."
Solution

If there's no clear winner as the leading software development platform, then one answer for network operators is to specify apps that can run in multiple environments. "Many developers have created their own middleware to abstract the differing handset issues on Java," John Chasey explained. "Metismo's particular version of middleware, called BedRock, goes a step further and as well as handling all the J2ME handsets it can cross-compile from Java to C and produce builds for Symbian, Brew, and even Flash." According to Ovum's Tony Cripps, there are niche companies which specialise in taking the pain out of developing mobile apps for Java enabled handsets. Providers such as Tierra Wireless in Canada can take an existing Java application and re-specify it so that it runs properly against its own database of Java handset capabilities.

Fragmentation
The fragmentation within the mobile apps development community is something of a double-edged sword for network operators. "In their struggle against being reduced to pipes of various girth, operators take pains to differentiate along lines that can encourage fragmentation," says Bill Weinberg. Conversely, as James Tagg observed, mobile apps developers are forced by this very fragmentation to spend out millions on multiple versions of their client software just to keep all the operators happy. Without fragmentation that money could be spent usefully elsewhere.

Dominic Smith looks at the impact of online billing, both on consumers and on operators, and at how billing presentation can actually increase ARPU

Online billing has become increasingly prevalent as consumers' trust in making financial transactions over the Internet has grown.

Paper bills are seen by many as environmentally unfriendly. In a recent survey by Harris Interactive and the Marketing Workshop, 52% of online bill payers cited, "receiving bills in electronic form saves paper and energy, helping our nation's environment" as a major reason for choosing to receive them. According to the report, 39% of those now using online billing have cancelled paper billing from their banks.

In many developed countries, this enthusiasm is driven by consumers' ever-increasing familiarity with the web along with a rapidly increasing Internet penetration rate. In other underdeveloped nations where rates are a lot lower, the move online is being fuelled by the erratic nature of postal systems and the fact that the delivery of paper-based invoices to end customers is often unreliable. 
In the business world, the telecoms sector has been a leading pioneer of the online approach to billing. In a recent survey of readers of Cerillion's e-newsletter, Evolve, 57% of respondents said that they were now using online billing for their telecoms services, which highlights just how pervasive this service has become.

Open and Informative
Broadly speaking, there are two quite different approaches to online billing currently in use. The first is essentially just an electronic equivalent of the main paper bill. This is typically a PDF copy of the printed invoice, either emailed or available to download online, with little or no additional functionality.
The second approach, often referred to as e-bills or e-billing, adds value by being formatted and organised in a more appropriate way for online use, enabling customers to interact intuitively with the bill in a native web format and become better informed about the information contained within.  
For the end user, one of the great benefits of the latter approach is the added transparency online billing can provide as a key element in a cohesive web-based service strategy. Operators can keep customers informed of service costs, the tariffs being applied and the potential cost or benefit of adopting or migrating to new services. In today's increasingly complex converged telecoms age, this is a valuable tool within any operator's armoury.
The end objective is to encourage customers to use existing services more and to subscribe to a broader range.

There is a slight risk that this open approach may deter users if they can clearly see that a given service is costing them more than they anticipated. Typically, however, displaying this level of transparency will build increased trust between operator and user and generate enhanced levels of customer loyalty.   

In this context, online billing should never be seen as a standalone option but rather as an integrated part of the overall online self-service capability that a telecoms operator can provide to its customers. In addition to electronic bill presentation and payment, such a strategy would typically also take in self-service account management; provisioning of new services; bill analysis; and trouble ticketing
Such an approach also integrates neatly with web portal strategies, complementing call centre services, helping to provide a consistently high level of customer service and promoting new service offerings to those customers.

After all, with so many products and services on offer, one of the biggest challenges for operators is making their customers aware of them. As part of a web self-care approach, online billing can help increase average revenue per user (ARPU) by supporting cross-selling and up-selling initiatives, enabling customers to browse complementary products and services without the hassle of finding a dealer, or calling customer services. Customers can then order online, and track the status of orders to completion.

Operators can further enhance the online user experience by providing self-learning knowledge bases, enabling customers to easily find the information they need without resorting to the need for assistance from a customer service representative. This approach can raise user satisfaction levels and at the same time reduce operator costs in the call centre.

Online billing also supports an interactive approach. Customers can drill down to find extra information on their itemised invoices and unbilled usage. They can also arrange, sort, filter and search their bills using familiar PC-based tools. It is therefore typically much easier for customers to understand an electronic bill than a printed paper-based one.

Going Green
Operators often see online billing as a key element in a ‘green' telecoms strategy. In addition to the obvious benefits of "paperless" online billing, the concept of self-care for customers is in itself an environmentally friendly one.

Customers can be encouraged to carry out key tasks easily themselves online such as updating personal details or ordering new services without drawing too heavily on the resources of the operator, either in terms of systems or of people. Self-care typically results in reduced customer dependency on large call centres, and, by association, radically reduces the amount of physical equipment required to service customers. 

Lowering Costs
The environmental benefits of online billing are fairly clear then but what about the cost savings that online billing is reputed to bring about? As part of an integrated web self-care strategy, the approach does have the potential to optimise customer service costs by enabling more requests to be processed online, reducing the volume of calls to contact centres and allowing key resources to focus on more complex customer service requests and outbound calling.
Secure online presentation and distribution of invoices speeds up bill-processing, approval and payment, while online access to billing history simplifies storage issues and allows analysis of communication costs over time.

However, if operators are looking at adopting this approach primarily as a way of reducing their costs, a note of caution does need to be struck. Another finding of the Cerillion survey was that 27 per cent of respondents received both paper and electronic bills. One of the reasons for this may be that in certain countries it remains a legal requirement to issue paper invoices even when the customer prefers to receive them electronically.

For operators that are looking at online billing as a way of reducing their costs, this is a sobering statistic. After all, if they are producing and issuing both paper-based and equivalent electronic invoices, their billing costs may even rise slightly.

However, their customer service costs are equally likely to fall as a result of the online provision of higher quality information about the bill. Similarly, operators may find that revenues increase down the line as a result of enhanced customer loyalty generated by the provision of more transparent service offerings and a consequent reduction in churn. 

Wide-Ranging Benefits
Ultimately, the continuing migration from paper-based to online billing looks set to continue. The benefits are just too far-reaching to ignore. An effective online billing strategy can help operators to build customer loyalty and trust, while tapping into additional revenue streams and reducing operational overheads.

Customers also gain from the improved customer service they receive and through the sense of enhanced control they gain over their billed and unbilled usage. While paper-based invoices will be around for some time yet, the future of telecoms billing does look set to be increasingly web-based.

Dominic Smith is marketing director of Cerillion Technologies

Sometimes it’s good to look back and see where we’ve come from. And sometimes it’s good to look forward. It’s even better when you can do both, and we can do that here, because a year after we spoke to NeuStar executives in depth in Mobile Europe (www.mobileeurope.co.uk/interview/1151) we can now do the same again. Keith Dyer caught up with General Manager of NeuStar’s next generation messaging business, Allen Scott, and asked him what had changed in the industry, and where he thinks IM, and the use of IM enabling technologies, is heading

Keith Dyer:
A year ago NeuStar executives laid out their vision for the IM market. Can you identify where you think IM is in the market right now?

Allen Scott:
We’re going through another shift in IM, and we’re also seeing interesting things happening in the mobile space that we didn’t see a year ago. Operators have been looking for an SMS and voice revenue replacement. They are seeing signs of SMS and Voice ARPU decreasing and that’s putting pressure on each new service they launch. But the pursuit of that goal by searching for a single product has deluded them. This year, operators are looking for a platform for new future revenues that come from a services mix. And IM is part of what will generate that future revenue. There is no single replacement, it will be part of that overall shift.

KD:
Do you think that shift will see more open internet platforms, and operators trying to leverage off mobile internet services?
AS:
In fact, the big thing in 2008 will be the growing realisation that mobile is not the internet – and it’s a big mistake to try to take internet services and platforms and simply port them to mobile. The user gets confused because a mobile phone is not the same as a PC. For instance if you sit down in front of your PC you’d think nothing of spending 30 minutes trying to achieve what you were after, but mobile is immediate and personal. The PC and the mobile are different like TV and radio are different.
So one change in the industry as we head into 2008 is that increased focus on the mobile experience for the consumer – focusing on what they want not what we think we should give to them. And this is where IM becomes very interesting because people are using it. We are seeing a jump in IM numbers and when we see operators launch with that focus on the user experience they are getting significant growth. Shortly after launching services there are hundreds of thousands of subscribers signing up. Vodafone Portugal is in the public arena with 100 million messages in the two months since it launched mobile IM. We have handled three billion messages and 3UK itself has a billion since launch whilst another of our customer’s launches saw up to a million registrations in the first month.
Operators tend to be coy about numbers so the fact they are going public is evidence of their confidence in the service.

KD:
What does “focusing on the user experience” mean, in real terms?

AS:
On a phone, more than anywhere, your community belongs to you. My friends are my friends, so why do I want to go to another community or space to get hold of them. Now, I have different communities for different reasons. I might be a heavy Windows Live or Yahoo! user for example and when I go to the mobile, the thing is I want to access my chosen community as soon as I can. So I need access to a few of my core communities, the same way I can access friends in the address book.
Then the outcome is that access point becomes my focal point for communications, video, showing content and so on. Now, there is a lot of talk about mobile advertising, but there will be no revolution in the mobile industry around mobile ads if you can’t provide them in the context of a service that has a purpose and has a value. WAP is not even a service looking for a home, because it is not even seen as a service. Operators and brand names looking for that stickiness need to know it has to come from services. IM provides the eyeballs for a mobile phone.
You need people that understand the customer to work with you to provide the best possible user experience. If someone’s a gambler for example, you need someone who understands that if you allow them to do that and play poker through an interface on the mobile phone – that’s real time communication, if you think about it. And in the poker game, that community belongs to the user, and is a closed community in itself personal to him;  and they are not the same people in his voice or SMS client.  But if we manage the ID and presence, then the natural thing is to allow this guy to control that so he can interface with his gaming application in the way he wants – this holds immense value to him.
So you can build up additional functionality around IM. But at core IM is a very simple application – it’s chat, talk, text to those you want to be in contact with at that time – and if that’s ignored or the experience gets too ad-cluttered, or saturated in rich content or applications, the rich mobile experience will die or slow down.

KD:
So it’s about the customer being in control and simplicity. Is that what you meant when you talked about operators launching with the customer experience as their focus?

AS:
There’s evidence that the more mobile flavours you add the more you confuse the customer. When there are 50 brands of washing powder on a supermarket aisle, and therefore massive choice of washing powder, there is evidence that overall sales go down because the customer is confused with what to buy, so ends up buying less. It’s much better to understand your customer and what he wants. When it comes to choice, less is more. When it comes to simplicity, the iPod and iPhone are excellent examples of a great user experience – simple to use first time is the secret of a successful service.
The evidence is that overall sales go down, because the consumer is confused by the choice, and ends up buying less.
If the devices really oversimplify the user experience, then you begin to get customers to use services because they are easily accessible from one place in the handset. We are engaging with OEMs, operators and ISPs to show this is the right way to provide more value to consumers, then more revenues into the industry.

KD:
So how can operators ensure they have a successful service launch?

AS:
First, they have to believe that this is not about cannibalising SMS. The key thing is understanding that first. If you understand that then you get a pricing strategy where the aim is the creation of future revenue streams. It starts with the operator being in for the long term. Turkcell, 3 and Vodafone are all examples of operators that have shown that long term commitment.
Secondly, understand the target audience. Who are you trying to get to? What does the customer actually want? From an IM perspective, someone who has never used IM – would they extract the full value? No. So generic broadband marketing does not work. Operators can work out the number of GTalk, Yahoo! MSN Messenger and Skype users that are also on their network, and what devices they’re using. Then they can target these handsets. The next thing is marketing to them, perhaps using an SMS/MMS campaign making the service available. Then the client must be available on a download server to go on the device. Irrespective of whether this is for an IM service within an operator’s own community or an ISP community – they have to understand that.
Once they get that, then you must let the consumer know clearly what the pricing is. You must be upfront on bundling so users don’t get charged in a hidden way. This is paramount to success – the results clearly show that IM has to be bundled. People want a services package and want to know what they’re getting.
This is a successful recipe and once I have this then I can build up communities and launch other services as they become of value to the user.

KD:
How do you see that layering of additional, added value, services being achieved?

AS:
When you are on the mobile phone and you want to access something you want to quickly make one choice. It’s, “I want to get hold of you now”, or, “I want upload a picture now”.
And I, as an operator, know your user characteristics, I know your mobile number, the client you are on, and so on. If you make sure that works really effectively with presence/ ID, then you can take an incredibly sophisticated and complex infrastructure and make it very simple to the consumers. If you control that information securely, then you can aggregate that information to other parties in a secure way, and that is your differentiation as an operator. You can meet service demands flexibly, in the same way that Google was really, really good at search, and because people trusted that, they then saw value in other services Google began to offer.
So privacy on the mobile phone is paramount. If you get other people coming in marketing around presence and id, guarantees are vital. If you use a bank, say, the way it handles the information it gives to third parties must maintain your faith in that business.
For example, if you are going shopping, your presence says you are on Oxford Street. But you don’t want all your friends and colleagues to see that. That’s where LBS goes wrong. But you do want the best offers, and you don’t mind people advertising to you because it is relevant at that time.
Our thinking is that with IM and presence, without changing the infrastructure, it’s the first service that allows user of other services to come in and play. Everyone is rushing to access the APIs of internet providers to drive the experience. But we sit in the piece where the mobile experience is. Mobile has the footprint and everyone is trying to get everything onto the handset. You need a service that can aggregate between all the players and provide that to consumers.
Because without customers adopting it, it is just technology.

The interoperability tests are said to assure operators that they can confidently source IMB equipment from multiple vendors and assure handset manufacturers that their devices will be fully compatible with all IMB networks. IMB is capable of streaming live video and broadcasting and storing popular content on the device for later consumption – both resulting in significant offloading of data traffic from existing 3G networks.

IPWireless and Huawei say they are committed to the development of an IMB ecosystem and ensuring readiness of the technology for market as quickly as possible.  IOT will ensure compatibility between Huawei IMB base stations and IPWireless chipsets. Both companies are also said to be working together on several commercial and technical IMB pilots.

IMB was defined in the 3GPP release 8 standards, and was recently endorsed by the GSMA as their preferred method for the efficient delivery of broadcast services. IMB enables spectrally efficient delivery of broadcast services, in TDD spectrum based on techniques that are aligned with existing FDD WCDMA standards. This allows for a smooth handover between IMB and existing 3G networks. Operators can use IMB within a spectrum band that, although already allocated to them in connection with many 3G licenses, has hitherto been unused due to the lack of an appropriate technology.

“For IMB to achieve its full potential it is critical that solutions based on the technology are brought to market as quickly and easily as possible,” said William Jones, Chief Executive Officer, IPWireless. “As a leader in this industry, we are dedicated to the development of the ecosystem so that operators and their hardware partners are able to confidently and swiftly deploy IMB solutions. We are delighted to be working with Huawei in ensuring that the huge potential for mobile broadcast is realised.”

“Our operator customers are seeing an explosive growth in mobile data traffic, driven by consumer appetite for multimedia on the move,” said Jiang Wangcheng, President of Huawei UMTS network. “IMB provides profitability to mobile broadband operators for their business. We are very pleased to partner with IPWireless to explore the approach of developing profitable mobile broadband network, and to promote the IMB technology to matureness and commercialization.”

The companies say they are aiming to commence interoperability testing in Q3 2010.