Making Smart Use of Mobile Customer Data

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Do they want to contest or complement global Internet companies, who have already become major players when it comes to the delivery of communication and media services to consumers?

Can the operators compete when they are subject to regulatory rules and stricter privacy laws? Do they have their customer data in a format that makes mining and manipulation viable? After all, operator databases have been built almost purely as authentication mechanisms.

Mobile-Identity Privacy

Or maybe the operators don't want to compete. Based on user behaviors, operators may risk losing the trust of their customers if they attempt to exploit personal data. People seem quite happy to put increasingly detailed personal and photographic information about themselves and their family, friends, interests, travel plans, etc. onto sites such as Facebook—as well as posting work-related information on business networking services such as LinkedIn. Yet in Britain, consumers revolted over the mere idea of a mobile directory assistance service, called 118 800. The debacle demonstrated how protective users are of their mobile identities—not even willing to list their phone numbers—even as they disclose far more personal details on Web sites.

Mobile companies have only just started to market their services to their own customers. Until now, they were so lax about doing it that loyal, longtime customers often learned of new services or tariffs by reading about them in the media, rather than getting a simple text message from the operator. Beyond that, operators still aren't making much of an effort to tailor and target services for small to medium-size companies—surely a potentially rewarding market opportunity.

If operators decide to contest the challenge posed by Internet firms, they still face the problem of organizing and using their available customer data. The years spent deploying often-proprietary legacy systems have led to very fragmented data storage compared with that of Internet peers. Changes in data architectures will require investments backed up by solid strategies if operators are to modify their business models and develop new revenue streams.

Yet the rewards could be massive. Operators hold the key to maximizing the potential of the mobile-services market. But by competing with the OSPs, they risk diluting the impact of the mobile Internet. And they face almost certain failure if they try to build their own alternatives to already-popular online services such as Facebook. A far better path will be to develop value-add relationships with Internet companies, based on preferences. That will keep operators in the mix and give them a clear and essential future role beyond that of a "dumb pipe" utility.

Bengt Nordström is the co-founder and CEO of Stockholm-based telecommunications consultancy Northstream.

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