What is the Instant Gratification Generation, and how can operators plan their networks and systems to meet its demands? Nigel Waller explains all.
The lifestyle and mindset of the Instant Gratification Generation (IGG) is having a dramatic impact socially and economically. Actually more a pervasive cultural shift than mere target demographic, it’s the tendency of people to be online or accessible at almost any time. It’s the desire to want everything — from gossip, news and market data — to be up-to-the-second. It’s also the need to get consumer goods and business services in an instant.
The IGG trend presents a challenge to mobile operators: How to deliver services quickly and cost effectively enough to satisfy customers’ desire for the latest features, services and mobile applications. To compete, operators are migrating from legacy systems to next-generation networks that give them new levels of speed, efficiency and performance.
We are all part of the Instant Gratification Generation
The IGG is a larger societal trend, no longer based on a specific age, ethnicity, geography or other demographic, and it has grown to permeate the business and retail worlds, and our personal lives. To put this in context, the worldwide number of mobile cell phone users in 2004 is currently estimated at 1.6 billion people, an increase of 23 percent from 2003, and this figure is anticipated to rise to 2.1 billion in 2009 (source: Ovum, July 2004).
For better or worse, the IGG now represents a pervasive attitude or cultural expectation, not just a reference to the prevailing fashions and artifacts of the day. In the same ways that the Industrial Revolution sped up life more than a century ago, new technologies and ideas are speeding up our homes as well as the marketplace.
Gadgets of gratification
One can easily gauge the power of the IGG in profiling the adoption of the many technologies that drive its progress. People don’t just want to talk on their phones anymore:
* Approximately 17 million Britons have used their mobiles to access the Internet for rail/air timetables, mobile chat, location services, mobile images and music services. (Mobile Data Association)
* Worldwide camera phone shipments reached 178 million units in 2004 and are expected to increase to over 860 million in 2009. (InfoTrends/CAP Ventures, Luton, Bedfordshire)
The bottom line is that, when it comes to communication, information and media, Europeans — like their fellow consumers from Japan to America — want immediate access. They want to have the most complete range of choices possible. They want it on the go. And despite the bandwidth limitations, they ultimately want it all from a single source.
The operator’s challenge
Collectively, the marketplace demands a stream of new, innovative applications and product features that produce greater ‘stickiness’ to drive usage and revenues.
The harsh reality is that operations must deliver while also capping maintenance and other ongoing costs, simplifying administration, and leveraging open systems at all levels. And, due to intense competition, capital resources remain scarce, driving the need for more gradual migration strategies and scalable technologies that will optimise both short- and long-term return on investment.
As a result of these needs, change is accelerating at the industry level. A July 2004 Frost & Sullivan strategic analysis of communication applications in the market confirms for operators that voice and long distance services are declining as share of revenue.
A handful of priorities have emerged for mobile operators:
* Enhance the customer experience and increase average revenue per user.
* Lower the cost of customer acquisition, churn rates and total cost of ownership.
In the face of these ongoing issues, there are some market realities. The Instant Gratification Generation demands many services, applications In the face of these ongoing issues, there are some market realities. The Instant Gratification Generation demands many services, applications and capabilities simultaneously. Among enhanced services, messaging is the most pervasive. Text, instant, email and multimedia messaging will push much application development for the foreseeable future.
Next-generation networks: the platform to serve the IGG
Legacy messaging platforms just can’t keep pace with the demands for cost-effective, agile applications delivery. To overcome this, operators need next generation messaging platforms that are open and standards-based to facilitate a fast applications creation and deployment environment. Systems designed in this manner leverage common applications skill sets and reuse common software infrastructure and components. This is important in reducing demands on operations and development personnel, as well as increasing the time to market for new applications.
Technology factors are also key to unlocking the operator value proposition for enhanced services. To begin, an IP infrastructure is required to both control costs and support many new services. Achieving maximum value begins with a design based on an IP client/server development model and adherence to global industry standards. An IP standards-based client/server model and a rich application server platform are needed to support the converged voice and data applications mobile subscribers consistently request.
Additionally, speech and multimodal applications development should be vendor agnostic to accommodate the many protocols for recognition and next generation web communications.
Glenayre, through its proprietary Versera Intelligent Communications Environment (Versera ICE), delivers state-of-the-art computing and open source code that maximises mobile operators’ ability to cost-effectively deploy, maintain and operate messaging systems, and at the same time provides technology ‘headroom’ for the future. Versera ICE is an open communications solution that incorporates common, globally accepted standards, such as Java and VoiceXML, while supporting emerging standards and protocols. Versera ICE also supports the most widely accepted existing network specifications and protocols.
Open standards provide greater flexibility and long-term security, because there is no single vendor ‘lock in’. Operators are free to shop the market for applications that best meet their subscribers’ needs. Additionally, open standards can reduce the need for specialised training and support, which can help lower management and maintenance expenses.
Next-generation systems: the tools to serve the IGG
Despite the reality that most advanced applications still only enjoy low levels of market penetration, the next killer application is near. No one can say which will jumpstart usage, but operators would do well to prepare.
We do know that, as the market evolves, so must the companies who serve it. Successful operators understand the significance of these emerging implications:
* Operators must position themselves to profitably offer applications to even small percentages of their subscriber bases.
* Operators must be agile enough to deliver new services on demand.
* Operators must add new features quickly, without disrupting existing users.
* Operators must make messaging central to any migration strategy in the next two to five years.
Operators are realizing that the workflows supported by their legacy information and management platforms cannot meet current needs. Every day, time division multiplexing solutions fall further behind what are now commonly called next-generation systems. Next-generation solutions incorporate Internet protocol (IP or packet switched) and many other technologies that add tremendous productivity and performance improvements.
Look for the five ‘-abilities’
The grand prize in this race to satisfy the demands of the IGG requires deployment of Java-based applications, VoiceXML capabilities, IP infrastructure and other current technologies.
Taken together, they accommodate The Five ‘-abilities,’ the characteristics to look for in a next-generation solution:
1. Evolveability based on an open platform.
Homegrown and proprietary information technology platforms restrict what companies can accomplish simply because change becomes complex, time-consuming and expensive. A modular approach using common tools on an open architecture helps operators raise performance by leveraging a greater number of advances in security, processing power, applications, storage techniques and standards.
2. Distributability for faster time to market.
To capture new revenue opportunities, a high-velocity service creation environment is essential. Mobile and wireless applications developed using Java and VoiceXML offer a perfect example, as they greatly accelerate software development cycles.
3. Manageability and flexibility.
To navigate the transition to next-generation, service providers must be able to merge traditional telephony with the Internet technologies-at least for a time. An IP infrastructure lets operators integrate the old with the new, while offering new capabilities like IP storage and a larger selection of third-party applications.
4. Reliability to drive service quality. Operators face the dilemma of cutting costs while maintaining service levels for reliability and quality. Among next-generation features, VoiceXML-based voice mail is a mature function that has proven itself capable of outperforming legacy, proprietary voice mail systems. And VoiceXML adds far greater feature flexibility and cost structures.
5. Scalability of platform for multiple applications.
The key to unlocking the advantage of the new, next-generation technology is to run all applications on the same platform. These economies of scale are the foundation of the value an IP infrastructure brings. And when an operator wants to offer to VoIP networks, they’ll be ready.
Next generation equals revenue generation
The Instant Gratification Generation is one tough customer. But the mobile operators who meet the challenge will make good on a lucrative opportunity. They will choose an open-architecture platform that gives them the agility to take advantage of broader innovations in applications, storage and other technologies. They will enjoy a non-disruptive migration to a cost effective IP infrastructure. And they’ll do it all while maintaining a high baseline level of service quality. These will be the service providers for whom the economics of the Instant Gratification Generation translate into new revenue streams.