Project Management for the Digital Media Age

This blog will attempt to compile some project management and product management resources for practitioners working in the field of digital media; touching on areas such as standards, formats, methods and tools, platforms, architectures and distribution channels; and discusses some of the tactical and strategic issues that may arise.
Please also visit the accompanying blog exploring related Technology Convergence issues.

Sunday, April 1, 2007

Starting your own Mobile network - what are the risks ?

The fastest growing channel for content is undoubtedly mobile; but the question can be how to get past the gatekeepers of these channels – i.e. the cellular service providers or carrier networks- without paying too much; and making too many compromises on what you can and can not deliver; and get your content and marketing message into everyone’s hand ?

If you have the financial resources, one solution could be to start your own network - as an MVNO (Mobile Virtual Network Operator). You brand, market, and supply content for the service, and then buy the transmission capability from one of the established service providers, who are frequently happy to sell any unused capacity they have. After all, many of them have significant debts to pay off after paying handsomely for 3G transmission licenses over the past few years; an investment which has still to show any appreciable return.

Not only that, the cellular service provider industry is likely over the next decade to experience the effects of the VoIP revolution, which has already severely impacted the traditional fixed-line service market. As high-capacity WiMax hotspots start to proliferate, they will potentially give individual subscribers a choice in how they want each individual call to be handled - e.g. over inexpensive WiMax in urban areas, and using cellular service providers only when WiMax is not available. To an MVNO, this shift will be largely irrelevant, and likely be beneficial.

Possible risks that may impact an MVNO include-

1. Quality of Service (QoS):- If you don’t own the infrastructure, how can you guarantee the availability and quality of your service? One of your carrier networks could make a configuration change that could inadvertently disable availability of some aspect of your service.
2. Restrictions on the content you can offer due to licensing conflicts with the carrier networks’ own consumer offerings.
3. Restrictions on the content you can offer due to technical limitations of the underlying carrier networks. You can’t deliver content that your carrier network is physically unable to transmit. Even using multiple carriers with different service delivery capabilities may lead to patchy service delivery across your entire service footprint, leading to frustrated marketing teams, not to mention subscribers.
4. Billing - How to integrate billing information from a number of different carriers? Depending on the method used by the carrier network of delivering some content – especially enhanced content – the billing methods and tariffs may be very different. Your end subscriber doesn’t want to (or need to) know this, but you have to resolve these issues.

How to mitigate these risks –
1. Make heavy use of SLAs, and keep in constant contact with the carrier network to ensure that there are no upcoming surprises; that the carrier network is aware of your upcoming plans for upcoming service rollouts; and that they see a business benefit of upgrading their systems to handle the extra/enhanced traffic, if that is what is required.
2. The carrier networks may object to you hosting the same or directly competitive content; and include restrictive clauses in the service contracts. At the contract negotiation stage, ensure that your content is presented as complementary rather than competitive; and that the carrier sees a sound business case in hosting it. In some cases, it may be possible to license some of your content to the carrier’s own consumer product offering, perhaps benefiting both.
3. Although one of the main benefits of being an MVNO is not having to invest in the purchase & deployment of radio transmission & switching infrastructure that may become obsolete frighteningly quickly; it may make sense to host some critical pieces of infrastructure in –house, especially those which are necessary for the value-added services that differentiate you from your competitors. These would include HLR (Home Location Registers), SMS and MMS service centers, mobile email and instant messaging servers. Ideally, you only want to depend on the carrier networks to handle the basic mobile switching, locationing and radio transmission .
4. You will have to handle billing for your subscribers anyway; As with the VAS equipment above, it may make sense to have as much control over Billing and OSS (Operations Support Systems) as possible – i.e. installing your own infrastructure. Ensure you know how the carrier networks handle and charge for carrying enhanced services, such as multimedia content, video, email and inter-network roaming; to avoid getting a nasty surprise when their invoices arrive.

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