Pulling Together

In a rare show of cooperation, four of the Middle East’s mobile operators have teamed up to address the region’s shortage of attractive data services. One plan is to create economies of scale for content developers by providing a unified platform and pooling demand from their individual markets. The other is to increase their influence over mobile handset design.

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By  Richard Agnew Published  July 28, 2004

|~|vas2.gif|~|L-R: Ian Dench, GM, marketing, Batelco; Andrei Torriani, chief product development & technology officer, Wataniya Telecom; Ross Cormack, executive director, wireless services, Qtel; Mickael Ghossein, CEO, MobileCom|~|The Middle East’s operators have still to prove the business case for mobile multimedia content, in part due to technical difficulties that developers face and a dearth of services that have been tailored purely to the Arab region. But four providers have teamed up in a bid to give the market a much needed boost. Through the Mobile Value Added Service (VAS) Alliance, announced in Dubai last month, they aim to pool resources, encourage Arabic content development and accelerate uptake of GPRS and MMS subscriptions in their respective markets. Initially, the group’s members — MobileCom in Jordan, Batelco in Bahrain, Qtel in Qatar, and Wataniya’s divisions in Kuwait, Iraq, and Tunisia — will focus on providing roaming for their pre-paid and GPRS subscribers. The initiative will then turn to demand and supply side issues of the mobile multimedia market by combining their subscriber bases and providing economies of scale. On the one hand, the operators hope to cut the time and money application developers have to spend connecting to different networks to create services for individual markets. Part of their plan is to create a single access point to their networks, as well as a common portal and SMS short codes, which would reduce the costs of services’ promotion to consumers. The other aim is to create a single market for multimedia services by allowing common access for their subscriber bases, which are small individually but collectively number over 3 million. “We’re all at similar levels of development and have the desire to provide these services,” says Ian Dench, general manager, marketing, Batelco. “But we’re all struggling to get good relations with the content providers because we’re small in our particular markets,” he adds. In turn, the move will help the operators to raise traffic and revenues from GPRS and MMS subscriptions. “The [project will give] easier access to advanced services and bring a broader range of smart, rich and compelling content. The economies of scale will be of direct benefit to our customers,” says Mickael Ghossein, MobileCom CEO. Another benefit of the union will be to give the operators larger, collective clout when it comes to negotiating with handset manufacturers over the design of phones. In the last couple of years, global operators such as Vodafone and Orange have been able to influence handsets’ specifications and interfaces, which are seen as a key factor in generating greater use of their content. But individually, Middle Eastern operators’ user bases have not been big enough to persuade manufacturers that this would be worthwhile. Although handsets are not subsidised by providers in the region and are separated from the business model of GSM services, the operators hope to push manufacturers to adapt phones’ design. “We don’t procure millions of handsets at a time so we don’t have the power of bigger groups,” says Andrei Torriani, chief product development and technology officer, Wataniya. “What we can do now is to band together and [tell] the handset manufacturers [which] services we want them to support. That will give them a wake-up call and will go hand in hand with the application development work we are doing,” he adds. Among the plans of the Alliance are to standardise MMS settings on handsets that are available in each of their markets, for example. “Phones purchased on any of our networks should be easy to set up and configurable across all of our networks,” says Dench. “Over time, we will maybe also have requirements for the handset manufacturers [to adapt the phones’] operating systems as well,” he adds. In the nearer term, the members will be concentrating on various technical tasks, including the establishment of IP connectivity between their networks and roaming for their pre-paid subscribers. While MobileCom, Wataniya and Batelco have already established GPRS roaming and MMS interworking, Qtel is currently testing this with the three other members. On the content side, the group also has to install a joint development system before its first common services are launched. Their aim is to have the joint platform in place by Q404. “We have to show some developments soon after launching,” admits Dench. “Early developments will be around roaming, but expect to see some common services by the end of the year,” he adds. Going forward, another challenge the initiative faces is to maintain its early momentum. Although the group is yet to create formal terms of reference and decide who will head it up, its members’ plan is to get together and discuss opportunities every ten to twelve weeks. Working groups will be tasked to work on specific projects and report back at each meeting. “It will be a rolling effort — we won’t meet and then go away and work in isolation,” says Ross Cormack, executive director of wireless services at Qtel and the recently appointed chief executive officer of the operator’s upcoming business in Oman. Another factor that will affect the project’s expansion is its policy over new members. Although many similar programmes have been set up on a global basis and in other areas, the group is the first of its kind in the Middle East. But whether it grows into a region-wide initiative remains to be seen. The upcoming launch of Wataniya’s Algerian division will provide a new market where its services can be targeted, and the group says that it will shortly announce other participants. But commercial interests may influence its future make-up. It will be up to the existing members — all of which currently operate in different markets — to approve any operators who want to join up. “We’re talking to a number of different players,” says Dench. “We’ll look at how they complement the alliance, commercially and technically,” he adds.||**||

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