Business With an Innovative Music Payment Plan

Mobile operator Telia Norway said that customers with a business subscription can now use its Music Freedom service without burdening their employer with the cost, by paying the NOK 49.00 (US $5.10) monthly charge themselves using the Norwegian mobile payment app Vipps. The aim is to stop corporate subscriptions from being restrictive.

Music Freedom separates data used for streaming or downloading tracks from the allowance provided in the subscription. It works with Spotify, Apple Music, Tidal, Deezer, Beat and Audiomack, via mobile application or browser. Music Freedom includes use in the EU/EEA and Switzerland.

Vegar Heir, commercial director at Vipps, said Telia is an early adaptor of new payment methods and is one of the first mobile operators to offer its customers the option of recurring payments.

The increasing blurring of the boundaries between personal and business use of mobile devices poses some challenges for both mobile operators and mobile users. BYOD usage patterns encourage employees of companies who are on business plans to use their devices for ubiquitous personal purposes such as music streaming. Of course, this can create problems for the employers when it comes to dealing with the charges, getting reimbursement from employees and maintaining corporate morale.

Telia Norway is offering an app-driven solution to this problem by allowing a kind of split billing in which the employee pays the monthly charge directly, as an individual, for music streaming from Spotify, Apple Music or whichever service, despite the fact that the rest of the data consumed is paid for the company. This way, there is no conflict, and both employer and employees are financially whole. The partnership with Vipps, the mobile payment platform, enables the functionality of the payments possible in what appears to be a seamless manner.

Music Freedom, true to its name, should provide enough freedom to keep corporate subscribers happy, which in turn should increase loyalty and subscriber acquisition in future.

Tarifica is a global SaaS company and a market leader in the real-time collection, analysis and delivery of telecom plan and pricing data worldwide. Through a mix of AI, modeling and market expertise, Tarifica tracks hundreds of thousands of plan and pricing data points daily. No other company tracks more. Tarifica's mission is to continuously convert data into the dynamic intelligence that fuels opportunities for its clients, the world's leading operators, regulators and consultants. 

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Google to Add Android Infotainment OS to Volvo, Audi Cars

Google has announced deals with Audi and Volvo to add its Android in-car infotainment system to their next generation of vehicles. In a short statement, Google said that the official licensing agreements mean that Audi and Volvo car owners will eventually be able to use the automotive version of Android to control their air conditioning, sunroof and windows, to find nearby restaurants with Google Maps, listen to Spotify and other entertainment content, and ask Google Assistant for help. The company added that a preview of the Audi and Volvo systems will be on display at the Google I/O developer conference in San Francisco beginning on 17 May.

In a separate statement, Volvo said that it plans to launch its version of the Android OS on new models within two years, adding that the large catalogue of popular Android apps developed by Google, Volvo or third-party app developers will offer connected and predictive services in and around the car. Audi said the Android OS will be included in the new Audi Q8 Sport concept technology platform, with the new functions running on the large MMI touch display on the dashboard. The information will also be visible in the Audi virtual cockpit in the driver’s direct field of view, marking the first time the new services have been fully integrated into Audi’s brand-specific infotainment system.

With these agreements, Google is moving to provide a fully integrated Android mobile operating system for motor vehicles. That is a significant step forward, in that existing built-in Android solutions (provided by Honda and Hyundai in some of their car models) have been implemented without the full participation of Google and therefore use old versions of the operating system. Google’s current product, called Android Auto, is not integrated with cars’ on-board computers and needs for there to be a smartphone in the vehicle.

While the full details and functionality of Google’s new Android solutions for Volvo and Audi will become clear after they are demonstrated at the San Francisco conference this week, it is likely that it will be superior to the existing solutions, and that it will give seamless access to selected infotainment content from providers with which Google has partnerships.

In this respect, we see both opportunities and challenges for mobile operators. Of course, while the connectivity for the on-board infotainment system will not come through a smartphone, we imagine that in most cases it would come via the networks of local MNOs. If this type of service sees significant uptake in the marketplace—which would depend on it expanding beyond just these two auto-makers—MNOs would be seeing a new revenue stream. There would need to be mobile service contracts and plans, independent of existing smartphone plans. Or in-car service could be a new plan element to be added to the contracts of existing customers.

However, as we have frequently observed, operators do not want to be relegated to the role of “dumb pipes” in any sector of the mobile market, so in this case they may want to see what they provide to drivers in the way of special, relevant content. The challenge lies in the fact that in a sense, Google will have beaten them to it, by signing deals with Spotify and other content providers, as well as making its own content particularly easy to access. Nonetheless, we believe that MNOs can offer special access to information and entertainment content, as well, and that the best way to do this would be to target the content locally. Operators will be able to make deals of their own with content providers in the home regions of the customers, so that navigation aids, shopping aids, and even entertainment products could be tailored to the specific tastes and needs of the operator’s customers. And mobile operators do have privileged insight into their own customers’ preferences. 

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.

To learn more about Tarifica, please visit www.tarifica.com 

Sprint Acquires Stake in Jay Z’s Tidal Music Service

U.S. operator Sprint has agreed to buy a 33 percent stake in the music streaming service Tidal. As part of the deal, Tidal and its artists will create exclusive content for Sprint customers. No financial details of the deal were disclosed, although Sprint is said to have paid around US $200 million. The rapper Jay Z, his wife Beyoncé and the other artist-owners of Tidal will continue to run Tidal’s service, while Sprint CEO Marcelo Claure will join Tidal’s board of directors. Sprint and Tidal will also create a dedicated marketing fund specifically for artists, which will allow them the flexibility to create and share their work with and for their fans. The partnership follows Tidal’s recent unveiling of Master quality recordings, as it continues to focus on the high end of the streaming market. Tidal is available in more than 52 countries, offering over 42.5 million songs and 140,000 videos. First launched by the Swedish company Aspiro, Tidal was acquired in 2015 by a company backed by Jay Z and relaunched in more markets.

In the ongoing drive for mobile operators to stay relevant and not devolve into being mere providers of a commodity-type service, streaming entertainment content—especially exclusive content—has emerged as a major factor. Sprint’s purchase of a large stake in Tidal instantly makes the U.S. operator, which is majority-owned by Japan-based Softbank, a player in the streaming music game. Tidal is not one of the biggest music providers; Spotify, one of the global leaders, has 43 million subscribers, while Tidal claims 3 million and some reports say only 1 million.

Still, we think the acquisition of the stake is a coup for Sprint. For one thing, the fact that Tidal will create content exclusively for the operator means that Sprint will have a powerful tool with which to retain subscribers and attract new ones. For the operator, Tidal will be a brand enhancer that can sharpen the competitive edge. In addition, while Tidal’s customer base may be small, the company targets a high-end demographic with its relatively high pricing. And the fact that it is artist-controlled not only ensures that its offerings will be high-quality, it also affords another marketing opportunity to Sprint, which will be able to enlist the celebrity artists for promotional campaigns.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.

To learn more about Tarifica, please visit www.tarifica.com 

oT Devices Used in Attack on U.S. Internet

The hackers who launched a distributed denial of service attack against the DNS provider Dyn late last week used hundred of thousands of connected devices such as baby monitors and home security cameras to infiltrate the networks. Dyn’s clients including Twitter, Netflix, Spotify, Airbnb, Reddit, Etsy, SoundCloud and The New York Times experienced internet service disruptions. Security experts have been warning for a while now that IoT connected devices can be infected with malware in order to cause disruptions of service across the internet. The gigantic, rapid growth of the IoT sector promises revenue to operators as well as device manufacturers, but this incident is a sobering reminder that humble connected devices used by unwitting consumers can provide easy entrance points to national and global networks. The IoT is an essential component of the worldwide telecommunications economy, but at present it appears to be an Achilles heel that needs tighter security.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance.

To learn more about Tarifica, please visit www.tarifica.com 

Redefining a Mobile Service Provider

There is a paradox at the heart of the mobile telecom industry. Despite skyrocketing data use and proliferation of connected devices, the industry is facing a structural crisis that raises serious questions about its sustainability and growth. With mobile penetration rates in almost all markets well above 100 percent, competition among MNOs has grown fiercer and more focused on price reductions. Traditional sources of revenue have been undercut by OTT services such as WhatsApp and Skype. The increase in consumer data usage has been a mixed blessing in that it has placed pressure on operators to make expensive improvements to the capacity and coverage of their networks. Finally, national regulators have become increasingly activist with regard to pricing, M&A activity and service requirements, further increasing costs for providers.

In the face of this paradox—increasingly large amounts of money flowing through the mobile industry while operator revenues grow ever flatter—we expect to see new business models, revenue drivers, pricing strategies and even leading players. Ultimately, the results of these changes could be the redefinition of the term “mobile service provider.” We have already begun to witness the first steps of this process. MNOs have worked to reevaluate their core offerings in order to find new sources of revenue or to reduce churn. The defining trait of 2014 was MNOs’ drive to acquire the infrastructure needed to offer converged packages. Operators around the world—but particularly in the hypercompetitive European markets—pushed to lock in customers and raise monthly spending by offering quad (mobile, fixed voice, broadband and cable television) packages. Further, non-core value-added elements like Spotify, Netflix and other content-driven services became increasingly important in plan construction, forcing operators to branch out into new partnerships and ventures.

A dramatic recent example of this occurred in the U.S. with Verizon’s US $4 billion acquisition of AOL—a play to secure AOL’s mobile ad software, more proprietary content and new revenue streams in an increasingly competitive market. This type of news is an illustration of how the distinction between content creators, information aggregators, device manufacturers and service providers continues to grow blurrier. Just as we expect mobile operators to be packaging more non-traditional features in with their mobile packages, we believe that there is an opportunity for other types of companies to enter the mobile services space and use these services as a way to augment their traditional packages.

With Facebook’s acquisition of WhatsApp and Google’s ever-expanding reach across all realms of digital life—including its recently launched U.S. MVNO running on the Sprint and T-Mobile networks and its discussions with Hutchison Whampoa for international expansion—we would not be surprised to see either of these entities begin to pivot increasingly into mobile service as an add-on to their traditional offers. While projects like Google Loon/Fiber and Facebook Zero made headlines before retreating from the industry consciousness, the economic conditions that initially drove these initiatives remain—giant internet content providers that have significantly higher margins are growing impatient with mobile and broadband providers’ ability to connect their potential customers. Further, MVNOs like FreedomPop are experimenting with new business models like ad-based data sales. Finally, whether through mesh networks, ever-expanding Wi-Fi hotspots or new technology solutions, MNOs’ hegemony over mobile data is likely to be challenged in the coming years. The high and growing demand for large volumes of fast data makes the industry a prime target for disruption if an adequate alternative presents itself.

There are so many variables in play that it is impossible to make a firm prediction as to the precise long-term evolution of the industry. However, this much is certain—for MNOs to be successful in the future they will have to be adaptive and flexible in terms of developing new revenue streams and fending off non-traditional rivals. Maintaining outmoded plan structures and customer acquisition strategies will almost inevitably lead to painful disruptions. The current structural and competitive environment have the potential to change the core MNO business model in a way not seen since the launch of the iPhone in 2007 and the beginning of the mobile-data revolution. As such, strategic choices made by operators in the coming years will have an outsized impact on the future of the industry as a whole.

Tarifica is the global leader in monitoring and analyzing telecom pricing. Covering hundreds of operators in every region of the globe, Tarifica’s databases of mobile and fixed line data and voice tariffs are among the largest and most in-depth in the world. Tarifica is also a leading publisher of benchmark and other pricing reports, and its analysts are recognized authorities in the telecom industry, relied upon by operators and businesses worldwide for pricing insight and guidance. Click here to contact a Tarifica Analyst

T-Mobile Poland Offers Free 12 GB of Data with Mix Plan

T-Mobile Poland has launched a campaign that offers up to 12 GB of data at no additional cost to new customers who sign up with any of the operator’s Mix plans. The additional data will be valid for one year. Also, new customers and those extending their subscription contracts will receive a free monthly package of 100 SMS/MMS for the first six months or for the whole contract term, depending on the plan selected. The new offer is available both to consumer and to business subscribers.

The mobile market in Poland has very high penetration levels and is dominated by four mobile operators. As we have reported previously, mobile operators that provide services in developed and emerging markets alike are concentrating more and more on expanding the overall value of their plans by adding additional services or unique content to existing packages at no additional cost. Offers that include popular content such as music streaming services, entertainment, sport, unlimited access to social media outlets, as well as a significant amount of mobile data are highly popular among subscribers and thus constitute a good source of revenue. T-Mobile’s new offer provides a very generous amount of free data that can be used over a 12-month period, so that subscribers can take advantage of it throughout the duration of their contracts. We believe that this new campaign will not only attract new customers but will also promote T-Mobile’s 4G LTE network and have a positive impact on the operator’s position on the market.

 

Our recent findings using the Tarifica Score™—the leading measure of consumer value for mobile plans—confirm that additional amounts of mobile data tremendously increase the overall value of a plan. The Tarifica Score™ also highly rates content services such as access to Netflix, Deezer, Spotify or any social media platform. These value-added services are known to become popular on the market quickly and generate a good amount of revenue. Operators should focus on their market needs and include offers based on those preferences.

Edyta Krzton, Senior Analyst at Tarfiica

The above item appeared in a recent issue of The Tarifica Alert, a weekly resource that analyzes noteworthy developments in the telecoms industry from around the world. To access all of the latest articles and issues or to speak with the research team: http://www.tarifica.com/contactus.aspx