In this blog, I thought I would try and look at the app developer community from the mobile operator perspective and bring out some thoughts, I gave a richer version of this as a lecture at The Mobile Academy in London, hosted by Mobile Monday London and UCL. It seemed to be appreciated and so here are some extracted points.
1. Think Scale
Firstly, think about the mobile operators, they are enormous companies but have you ever thought about the scale of them. For instance their networks cost billions literally to build and to fund, in the UK they spent more than 20 billion pounds on spectrum for their 3G networks, money which they have never got back in reality.
They have huge customer bases, have you ever done the maths to realise that with churn at 1.5 to 2% per month, then a big operator with 20,000,000+ customers like EE for instance can easily lose 4,000,000 customer a year and has to replace them just to stand still in terms of market share, and it costs several hundred pounds to acquire each customer.
So a company of this scale is not likely to be the most easy to talk to, certainly as a small developer, so my first thought is, make sure your apps use pretty well supported functions, if you rely on some new obscure network function that is only supported on one network its very unlikely that you can influence the deployment of the feature across all networks, so make sure you know the enablers you are using are widely available.
2. Think Climate
The other aspect of the mobile operators that is quite interesting and maybe not as apparent outside of their world is the climate that they are operating in. They have always been very competitive with each other for market share in particular. However they now feel that the regulatory framework is constraining their ability to earn the money they need to re-invest in the networks, for instance the constant erosion of the money that they receive for terminating calls. Similarly they feel it is almost immoral that they invest billions in networks, and then the over the top (OTT) players can exploit these networks at almost no cost and take their voice and messaging revenues. I guess it feels like a slightly one sided playing field. That’s why the price plans are changing from individual minute and message charging to large bundles and data charging.
3. Think Bandwidth
It’s worth looking at the technology that the mobile networks are built from as it can seriously impact the performance of applications. Around 20 years ago the GSM system was specified and built mainly around Europe, it then spread worldwide. It came with no inherent data capability until the arrival of GPRS which is still in service today and is the most ubiquitous mobile data bearer that is available. It has a very limited throughput typically only 9kbits/s in many cases, and it can normally be usurped if a voice customer needs the channel for a call. Then there followed 3G and more lately 4G generations of technology. These all improve the data throughput into the Mbits/s range practically with 3G and its variants up to 10s of Mbits per second with 4G. Of course, all of these systems are shared and will slow down when more users access the same data bearer and it is shared between them. So be aware that in theory your app may have to work or at least do something sensible when it is on a data bearer ranging from 9kbites/s up to 25Mbits/s!!
4. Think Latency
There is another aspect to performance that is often ignored against the headline data rate, and that is latency. Again, this has improved significantly over the various generations of the mobile data bearers. Latency is really key to performance and on long latency systems like GPRS, the ping time can be several hundred milliseconds, compared to a few 10s of milliseconds on 4G. So if you can build a ‘non chatty’ app it will perform faster than one which uses multiple serial requests for data.
5. Think Roaming
It’s worth mentioning roaming in this context for two reasons, firstly it’s expensive today but getting cheaper so your app may have to evolve to acknowledge this. Secondly, even if the home network has rock solid 4G that goes like a rocket, when you roam you can end up on anything from GPRS at 9kbits/s upwards, so you really do need to think about how this manifests itself as a user experience, especially when roaming around Europe for instance is very affordable and customers use data as if they were at home.
6. Think SMS
SMS is interesting for a couple of aspects, firstly it’s a really easy way to monetise applications because the charging models are very mature (there are loads of aggregators around that will let you send and receive SMS), and flexible, and secondly it is ubiquitous. SMS is a strange product, it’s 20 years old, and has never been enhanced, where else can you see a 20 year old product where the owners of the product have not tried to enhance or replace it – a really strange behaviour by the operators that left the door wide open for OTT players like WhatsApp and iMessage.
One last thing with SMS, you need to be aware that in some areas of the world it is prone to attack by spoofing, faking, DOS and premium scams.
7. Think M2M / The Internet of Things
M2M is a fascinating part of the industry. It does appear that after a long and painful birth it really is growing now. You have to think differently about some M2M apps, for instance if it is a mass app with millions of terminals then all of the economics around terminal repair, and network loading are very different from those for a smartphone with human owner. Similarly the security aspects are different and have to be thought about very carefully, I have seen one project in particular where misuse of a SIM security feature caused mass failure in operation and wrote off all the savings that the project was supposed to deliver. So one thing to watch for is often M2M applications are about cost saving and so tend to run on tight margins, margins which it is easy to destroy with very simple mistakes. On the plus side there is a healthy ecosystem for M2M enablers developing, and over time it probably is the biggest growth opportunity in the industry.
8. Think Voice
Lastly I have to mention LTE and voice. This is actually a comedy of errors by the operators. On 2G and 3G the voice and messaging services were completely embedded into the radio system including specialised channel coding for their support. This means an OTT app will struggle in terms of performance using a 2G or 3G data bearer compared to the embedded service. Along comes 4G and for some reason that none of the operators can explain other than ‘we forgot’, voice is an add on layered on top of a QOS assured 4G pipe. So bizarrely the operators have no more of an advantage with voice than any other player, eg. Skype, Vonage, Viber and in fact since the operators have almost no experience of OTT mobile VoIP they have played the best cards for one of their key services straight to the OTT industry. Actually this probably means that the industry will change substantially in a way that will be quite unexpected … but that’s an issue for another blog I think !!