News From Telecom World

It is good to chat: Why telcos should embrace instant messaging

Posted on: October 22, 2008

The pressure is on mobile operators to deliver interactive services to their subscribers, and IM stands to play a key role in this.

Instant messaging (IM) is currently one of the great untapped opportunities for telecoms operators. Be it launching their own IM service or interconnecting with other IM networks the potential is endless. Operators can increase customer loyalty, up and cross-sell to users, empower their brand by creating a community, increase MMS traffic and achieve the all important objective of increasing the average revenue per user (ARPU).

Operators have already started to utilise IM for customer communications. Many operators now encourage users to visit their Websites and IM is a very effective channel for online users to communicate with customer service representatives and other users. Through offering dynamic customer service, operators can increase customer loyalty at a time when customer retention is paramount for many of them.

However, when it comes to offering mobile instant messaging many operators have lacked a true commitment to backing the technology because of fears that IM will erode revenues from their highly-profitable text messaging services.

In fact, there are early indications that the growth patterns of mobile IM matches or even exceeds that of text messaging at the same time in its development. Over time, operators came to realise the value of text messaging as a supplementary service to voice calls and there is no reason why mobile IM cannot be an equally valuable service.

In an age when operators are placing equal, if not more, importance on their data services as traditional voice, getting people using IM on a mobile instead of a PC means operators can begin to generate decent amounts of revenue from their data services.

Ensuring interoperability
If mobile operators have learned anything from text messages, it is that interoperability across networks is absolutely essential to making it popular. SMS became ubiquitous when it became interoperable. Prior to this, users needed to know which network someone was on before text messaging them. IM is even more complex, with interoperability issues between Internet service providers as well as different operators.

One of the first changes in the market was the launch of Google Talk in 2005. Unlike the other main IM platforms, such as MSN, Yahoo! and AIM, Google Talk was based on an open protocol (XMPP), meaning that its network was interoperable with others.

For operators that are worried about IM diluting their brand, basing their IM platform on an open protocol is a very attractive option as it can give them more control of their brand, but at the same time allow interaction with a vast user base. Google Talk currently has more than 60 million registered users and with Facebook announcing that its recently-launched Web chat system will eventually connect to the XMPP protocol, there is the potential for a further 70 million users to be added to the network almost instantly.

Forward-thinking operators are embracing IM as an opportunity to differentiate themselves from the competition, by integrating IM with their existing services to build their brand and enhance the customer experience. By running their own instant messaging and presence server, operators can gain control of their own IM user base – which is not the case with MSN, Yahoo or AIM – and also create new services.

Tapping into social networking
The biggest area of growth that is opening up for telecom operators is the emergence of mobile social networking sites. Whether it is using a mobile version of a site like Facebook or using a specific mobile social networking site, people are getting increasingly used to being online and in communication with their social networks via their mobile phone.

Operators are likely to look to IM and social networking applications to drive traffic across their networks and Websites, either working with popular social networking sites or creating their own communities in which people can gather and communicate. It is here where IM can come into its own, as it combines messaging, presence and conversations with the ability to attach links or pictures. The presence piece, in particular, will empower real-time information sharing and chat as users will be able to tell their friends or ‘connections’ about what they are doing and whether they are busy or free to communicate.

The Internet-centric industry
The industry is undoubtedly moving from being telco-centric to Internet-centric. The launch of the iPhone and its subsequent third-generation model, is the clearest indication yet of consumer demand and mainstream adoption of the mobile Internet. Unlimited data plans are spreading and mobile devices such as the iPhone are going to increasingly use Web technologies and protocols.

The mobile Internet is the new telecoms battleground, so the pressure is on operators to deliver interactive, and importantly interoperable, services to their subscribers. IM stands to play a key role in this – it is not a question of whether operators will embrace IM, but who will benefit from being first to build truly innovative services using it.

Mickaël Rémond is CEO of ProcessOne.

Source: Total Telecom

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