What happens when the Internet of Things – trillions of devices,]]> In brief: Recounting my briefing in London with Amdocs prior to the CES 8 launch, the results of a recent service provider survey and the wider implications of both as operators move from selling access to selling value.

What happens when the Internet of Things – trillions of devices, sensors and “things” connected to communications networks by 2017 – collides with the advance of the mobile Web? It’s a tough one to call, but the ongoing series over at ReadWriteWeb outlines the elements of this mega-trend. From the spread of barcode scanners and schemes to the re-emergence of M2M on mobile operator agendas, it’s clear that the connected world is upon us.

This was the also the message that came across loud and clear during the Amdocs Connected World Dinner I attended during my last trip to London to connect with MSG partners and clients.

The informal thought leader event provided me the opportunity to meet with Amdocs executives (including Nick East, general manager, OSS Division, and Cassandra Millhouse, director of product marketing, OSS Division) to get a sneak preview of Amdocs CES 8, the updated version of the company’s customer experience system product line (detailed further down in this post).  We also took the opportunity to discuss the business and technical demands of the Connected World and debate upcoming industry hot topics in the run up to Mobile World Congress (MWC). My personal thanks to Amy Edwards, Amdocs Managers, Public Relations, for reaching out to me.

SHIFT HAPPENS

The Connected World discussion is centered on how service providers can/should adapt to cope with the capacity challenges to support trillions of “things” that require ubiquitous connectivity. However, the Connected World isn’t just about things; it’s also about people.

Specifically, it’s about architecting the flexible business models that will also connect and empower us. Competitive advantage results when service providers leverage the capabilities of the network and the customer data it collects to deliver highly personalized offerings.

The critical role of customer data in the delivery of relevant mobile search results, mobile CRM schemes and targeted mobile marketing and promotion are obvious. (These two podcasts focusing on the personalization technology and tools within the Amdocs offer – resulting from the acquisition of ChangingWorlds, a personalization and recommendation provider – underscore the value of data and the impact on the operator’s bottom line.)

Personalization also sits at the center of Amdocs’ Universal Storefront – a one-stop-commerce-experience-for-all-goods-and-services offer and a focus of its updated CES 8 portfolio. The aim: to allow providers to offer a single customer interface that masks the complexity of multiple systems and partnership relationships. (A business imperative for service providers determined to power this long tail of app stores and/or cultivate developer communities, according to my personal favorite post from VisionMobile.)

BUSINESS MODEL CHOICE

So, which business models drive positive and powerful customer experiences? And how can/should service providers prepare to do business in a hyper-connected marketplace?

My briefing with Amdocs provided some interesting insights – particularly since Amdocs reduces the plethora of possibilities down to three concrete business models:

•    The experience model: The provider makes the conscious choice to own the customer experience and establish its own brand equity. Here, the provider chooses “audience” over “access,” and follows through with expansion into media, advertising, commerce and a range of so-called “Telco 2.0″ services. An example Amdocs offers is the O2 Joggler “home appliance,” a service that is connected to the network and synchronized with family members’ mobile devices. It does loads of stuff under the O2 brand, letting families keep a common calendar, connect around online photo and video albums and consume Web-based content.

•    The vertical model: The provider creates and delivers services targeted to a specific vertical such as healthcare or education. (BTW: This model is gaining serious traction, earning it a central spot in the Netsize Guide I just completed. Verticals were also a focus of a comprehensive industry survey conducted by Netsize. Results will be released closer to MWC and MSG will feature an in-depth analysis of the findings closer to that date.)

•    The partner enabler model: The provider becomes a smart wholesale pipe and distributor for multiple partners. In line with this the new product portfolio CES 8 exposes network, IT and data assets to content and developer partners. An example Amdocs offers is AT&T’s behind-the-scenes support of the Amazon Kindle.

Some providers might pursue a combination of all three models, depending on their business objectives.

AMDOCS SURVEY RESULTS

It’s encouraging to see this thinking (supported by updates in the Amdocs offer) because it confirms that the basis of competition in the marketplace is shifting from battles between companies to battles between networks of companies. As I have written many times here on MSG and in my white papers and books: winning is about creating the platforms to freely enable other companies/players in the ecosystem to participate in value creation.

More importantly, the timing of the Amdocs launch and thought leadership dinner tells me mobile operators are finally ready to borrow a page from the strategy of Web giants such as  Google and Amazon, companies that cleverly opened up their platforms just enough to aggressively further their own interests and promote their business ecosystems’ overall health.

Fortunately, the sharpened service provider focus on new business models, expanding relationships and leveraging customer, network and product data is more than a hunch. It is also a key finding in the Connected World Survey conducted by analyst firm Frost & Sullivan on behalf of Amdocs. Vendor spin aside, the survey of 50 North American and U.K. service providers and stakeholders sheds important light on the opportunities/challenges at the top of the service provider agenda.

Among the highlights:

• Web giants are welcome: More than 90 percent of respondents stated that wholesale services and partnering with consumer Internet companies such as Facebook and Google were a growing area of business opportunity. The vast majority (more than 90 percent) also recognized the need for flexible business models to support new partnership opportunities.
• Billing, charging and CRM are central: More than 80 percent of respondents cited investment in the network and network planning as the number one area of investment in terms of preparation for the Connected World.  Respondents identified the areas of device activation, billing, charging, settlement and customer-directed self-service as essential to ensure future success.  Seamless activation, self-healing devices, and “do-it-yourself” support were ranked as critical.
• Verticals = New growth: Qualitative data from the survey found that the most promising new areas of focus for service providers include healthcare, consumer electronics, government and utilities.  Service providers identified these industries as prime for a high degree of new device adoption, infrastructure support and potential end-user demand.

TRANSFORMATION AHEAD

My take: The survey reveals that the industry is indeed evolving, turning up the pressure on service providers to take the plunge and adopt new business models. Amdocs’ evolved offering correctly focuses on what it takes to enable service providers to define and launch services; integrate customer support, billing, network operations and service delivery; and offer wholesale and partnership models.

Service providers that want to transform their businesses and succeed in the Connected World must boost agility and – more importantly – build an arsenal of capabilities (around customer analytics, preference, presence and device management) that they can/should share but never give away.

Note: The advance of the app stores makes pursuing an all-inclusive partnership model a must. MSG analyzes the impact of app stores and requirements for a better retail experience in an upcoming personalization and recommendation report. Amdocs will feature as a profile in this report along with other leading players in the space.

Disclaimer: Netsize is an MSG supporter. Amdocs is not an MSG supporter.  However, MSG has published a by-lined thought leadership column authored by a ChangingWorlds senior executive. MSG has also participated in invitation-only  thought leadership events organized by Amdocs.

In preparation for my own industry report on personalization and recommendation I have spent the last weeks interviewing a who's who of industry players and their customers (mobile operators/service providers), companies that are ]]> In brief: The MSG special report on content/advertising personalization continues with ChangingWorlds, an Amdocs company, and includes a review of the company’s recent road test of personalized mobile advertising across more than 200,000 people over a four-month period.

In preparation for my own industry report on personalization and recommendation I have spent the last weeks interviewing a who’s who of industry players and their customers (mobile operators/service providers), companies that are connecting the bread crumb trail we leave behind (browsing behavior, personal preferences, purchasing patterns) with an aim to delivering the right content/ad to the right person. Even better it’s in the right context. We’re not there yet, but the race is on.

My research uncovered a slew of companies sharpening their focus on collecting/collating/combining subscriber intelligence – mostly in partnership with mobile operators — for the delivery of content and advertising individuals are likely to appreciate based on their interests and those of their community. This special report profiles the players at the top of my radar

ADMOB, GOOGLE & DATA

I’ll have my take on the Google acquisition of AdMob later this week (doing a few more calls with sources). But if Google snapping up AdMob is the equivalent of the “shot heard round the world” for mobile advertising, then expect the battle to be fought on the territory at the intersection between content and context (the space where players can offer/boost reach AND targeting) will have the competitive edge. Granted, Google benefits from AdMob’s ability to deliver improved targeting, its deep understanding of mobile and expertise in formats that go beyond banners, but the end-game is all about intelligence.

This insightful post from Ian Schafer, CEO of Deep Focus, an interactive marketing agency, sums it up best:

“With the acquisition of AdMob, Google now has access to usage data of many of the most popular mobile apps — especially the apps in the iTunes App Store. For iPhones. If Google is taking on Apple for mobile OS market share, they just scored a huge competitive advantage. Google will know more details than ever about how people are using iPhone apps, how they are engaging with advertising within those apps, and users loyalty to those apps.”

So, if mobile advertising is hot, then expect the mobile personalization space to sizzle.

AMDOCS CHANGINGWORLDS CORPORATE DNA

The timing couldn’t be better to continue MSG’s special podcast series on the top players in personalization. We kicked off with segments on Openwave and Bytemobile, and continue with Amdocs ChangingWorlds, an Irish provider of personalization technology that was recently acquired by Amdocs and is now part of Amdocs Interactive.

By way of background, Amdocs ChangingWorlds’ flagship offer is its ClixSmart platform – a solution designed to provide individual consumers with “proactive recommendation of content based on their preferences and context.” In a nutshell, ChangingWorlds’ ClixSmart platform includes a variety of solutions in areas such as content recommendation, mobile search and mobile advertising. Sitting at the core of this platform is a profiling and personalization engine that is capable of capturing subscriber intelligence by automatically monitoring the implicit behavior of how users use and navigate the mobile Web. The solution has been deployed by 50+ mobile operators around the world.

Data from Amdocs ChangingWorlds demonstrates that mobile operator customers that have deployed its personalization technology see an improvement in their bottom line and in the quality of the mobile Internet experience they provide. But it’s not just about delivering content people are likely to appreciate; it’s about the wider opportunities around enabling the delivery of more relevant mobile advertising.

PODCAST INTERVIEW

To this end Amdocs ChangingWorlds has developed Ad Personalizer, a solution that brings advertising into play, combining the company’s own Relevance Engine with the learned preferences of mobile users to identify, select and deliver more relevant advertising. But does it optimize inventory throughput and click-through rates (CTR)? I can’t judge from my vantage point (I’m hoping to get more from my interviews with mobile operators). But I can deep-dive into some stats and a study of relevance in mobile advertising to understand the technology and the results.

I caught up with Stephen Oman, Amdocs ChangingWorlds Worldwide Director Sales Engineering,to talk about the purpose of mobile advertising, the value of personalization and the impact of the open mobile Web (off-portal and the proliferation of app stores) on both. In part 1 of this two-part podcast series Stephen walks us through some surprising findings and key data points.

PROFILING: By looking at individual profiles and profiles of like-minded people Amdocs ChangingWorlds builds up a an Ad Signature, “a blueprint of an advertisement that describes the audience that is responsive to this particular advertisement based on who sees the ad, who clicks on the ad and who ignores the ad.” Because the system learns in real-time, it can change the ads shown people on the fly. “We take into consideration that user preferences change over time and this is where the artificial intelligence-based profiling really has its strength.” Picking up clues on what people like and dislike “we can determine which audience is right for the message.”

RESEARCH RESULTS: Stephen deep-dives in to the methodology and findings of a study looking at the behavior of 200,000 people over a four-month period. The data is more pertinent now than ever because it underlines the pivotal importance of personalization in the scheme of things. The takeaway: personalized targeted adverts are, on average, almost twice as effective as traditional ad targeting (according to where the individual lives, for example).

TELEFONICA O2 & VODAFONE: Stephen tells me both mobile operators reported a positive knock-on effect after implementing personalization. On-portal browsing showed an increase, as did the rate of opt-in to receive personalized services. In the case of Telefonica O2, “over 95 percent of mobile subscribers have opted in to receive these personalized services.”

My take: When it comes to turning mobile advertising into a viable business, relevancy (not reach) will likely separate the leaders from the also-rans. Targeting may not be a must-have of marketing messages on platforms such as the PC, but on our mobile phones (personal devices) the rules of engagement are shaping up to be quite different. My various mobile advertising research projects (which have included survey of real people) and my current ebook (where I interview players up and down the value chain) arrive at a similar conclusion: solutions that can connect the dots to deliver/draw our attention to content/apps/advertising that are in tune with our individual preferences will have a central role in the strategies pursued by mobile operators, mobile content/app retailers – and a slew of companies in between. The opportunity I hear less about is mobile CRM. It’s great to deliver a targeted message but the ability to adapt the message to an individual’s evolving tastes/preferences/desires is surely the approach that clinches the deal.

The MSG special report on personalization technologies continues next month with Part 2 of the interview with Stephen Oman.

After that we look at the all-new Novarra, a company that has cleverly and quietly aligned its server/micro-browser capabilities to focus on a much broader agenda. It’s all about providing operators, handset makers and Internet brands the technology and know-how to create new services and revenue streams (with the help of in-network intelligence, mobile Internet click-stream analytics and context information from Novarra).

Listen to the Amdocs ChangingWorlds podcast here. [16:05]

Related posts:

SPECIAL REPORT: GETTING PERSONAL Openwave Adds Mobile Analytics; Are Gateway Providers The Ones To Watch? PLUS New Report/Project With GigaOM Pro

PODCAST: Bytemobile CMO Adrian Hall: Operators’ Can Win On Personalization; Does A Widget Bar Do One Better Than An App Store?

MSG DEBUT VIDEO: Xiam Talks Targeting & Filtering; Make Way For The Personalized Web!

GUEST COLUMN:Using Personalization To Pump Up The Volume & Increase The Value Of The Mobile Internet

Disclaimer: ChangingWorlds is not an MSG supporter.  However, MSG has published a by-lined thought leadership column authored by a ChangingWorlds senior executive. MSG has also participated in an invitation-only  thought leadership event organized by Amdocs.