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Wednesday, 9 May 2012

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

Posted on 05:46 by Unknown
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.
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