Guenter Krauss, SVP and General Manager of NeuStar’s Next Generation Messaging (NGM) business, tells Keith Dyer how he is moving the division’s strategy on to meet operator needs. As operators evolve their messaging strategies and infrastructure, the key, Krauss says, is to be able to act as a trusted services partner – and to put the building blocks in place to support that
Guenter, how did you come to join NeuStar and what did you find when you joined the company?
I joined exactly three months ago. I’m a veteran in the business and have experience of running major international organisations in the telco space, and of specific relevance to NeuStar’s business is my experience at Critical Path, which was certainly a company in a similar space, selling to a similar set of companies.
I was approached by NeuStar to take NGM to the next stage in its evolution. It is already a leader in its space providing mobile IM services to over 48 operators worldwide. When I joined, NeuStar had identified where mobile communications will evolve next and decided to facilitate this evolution and develop its services to take away the growing pains from operators. My goal is to help NeuStar make it easier for operators to create the next generation user experience on mobile and I see NeuStar as the leading provider to manage mobile communications and services.
The big advantage I see with NeuStar is that although there are hundreds of companies trying to sell different things, they all share one common problem – selling to an operator – it’s the most complicated thing in our industry.
Operators are very picky, they look at vendors not necessarily on what they offer but on what sort of company they are. Most operators look at a smaller company and query how long will they be around, can they trust their services, will an unfriendly partner acquire them? So operators need to be conservative because they have a network to run, connections to maintain. Now this is where I see NeuStar as having the advantage. NeuStar has the same story, with all the ingredients of being a conservative and trusted point of contact to operators.
So what have you done within the business to address this new approach?
First of all we integrated specific functions of NGM (Next Generation Messaging) into NeuStar’s hosting environment. The fact that NeuStar runs one of the world’s best managed-services operations has a big impact on what we can offer – so we are using the best resources now from our mother ship. This includes hosting support, Professional Services and R&D. We also restructured the company because it’s grown so much from a start up into a more professional operation where we have R&D that develops the products and services, hosting which is run by the US operation, and also Professional Services.
This means we have the people to deliver pretty much everything and anything an operator wants, and that is new to our business because we have traditionally been in the transaction business, not the services business.
That’s something our customers will see going forward, that we have support for our offering and can do whatever is required to make it work. That’s important because it positions us as a much stronger partner for an operator, making us responsible for implementing a solution and managing a service end to end.
And do you think this mirrors how operators are approaching services such as messaging, seeing it less as a point product but within an overall data communications strategy?
I don’t think you can say which way operators want to approach this. Operator A probably has a different idea about how to run something from operator B, but they still want to achieve the same goal, driving data revenues from communications services.
We’ve set ourselves up in a way that we can do whatever the operator wants. As you know our core product is an IP communications platform that today drives IM traffic, but it’s not limited to IM traffic. It can do pretty much everything: email, chat, and applications, whatever you can think of. NeuStar as this trusted entity is the best positioned company to provide these platform services for whatever the customer wants to do.
Recently, I went to one of our customers, and he told me, “We have so many companies coming to us pitching an application or service and telling us what they want to do. But all these vendors and ideas have one thing in common – we don’t trust them. So if you can be the trusted and managed services provider to deliver these services, integrated to our billing system, and deliver a range of services and application quickly, then that’s what we’re looking for.”
And this is what NeuStar is keen to do – to be that partner, to tie together all the different point solution departments that exist within an operator. That is a big proposition, something that requires us to be trusted, and allows an operator to drive their revenue goal forward without dis-intermediating themselves from other areas.
Does this focus on being a trusted service provider mean you think operators are moving away from a specific concentration on IM?
I think what is happening is that we are seeing the evolution of IM together with the need for people to access their IM communities and all other services in one place on the handset. Our focus is on the user experience and we are opening up our platform to reflect the fact that clients are converging into multiple functions on the handset.
Doing this gives the operators more choice of what services to offer and much more flexibility. Similarly the end user is given more choice, easier and faster access to their communications and services, and more control. So if your company decides to take five more clients, provide a new IM service or access to a social network, for example, the only thing you need to do is be compatible with our service on the back end.
Today IM is a core service, it’s third after Voice and SMS and we already provide the service to 48 operators today. Our customers know how they want to evolve their IM services and we are helping them to do this.
Analysts have predicted mobile IM will boom and all the reports are positive – especially Ovum who predicted mobile IM usage will rise by 4,460%! We certainly think we will see significant growth in 2009 because IM is a very sticky application. We know the user behaviour, we know how to market the service and we know how to sell it.
Is that information you can share with operators?
We have created a group this year that we call Strategic Services to share with our customers user behaviour, the best handsets for IM, the handsets which have problems, those which have more and less churn, and so on.
NeuStar is probably the only company that has such an abundance of data on IM behaviour. I think we transact close to a billion messages a month, so it’s a huge quantity of data that we collect from our systems.
We can see behaviour based on billing plans, for example, so that if an operator goes out and markets a data bundle that has IM, email, chat, we can see what that does to the uptake of the service in detail.
It’s technical, anonymous data from the platform that shows very quickly the patterns of behaviour each day, week or month, if billing plans change, if there is a big promotional campaign, whatever happens. When I saw what we have in this information I was just blown away. This is real intelligence, and this is a very big offering we can give our operator customers that nobody else in the world probably can.
Given this need for detailed information, do you think operators are still weighing up their best approach to this market, whether to create interoperable communities, or focus on certain communities? Will the information you offer help operators focus on what is the best user experience for their customers?
NeuStar launched itself in this business initially as being able to create an interoperable community between operators, because we have the technology and know-how to do it. The focus changed a little bit because the company saw the creation of internet-based communities on mobile, so it launched itself into mobilising IM vendors such as MSN and others. But we are still very intrigued by the idea of creating this interoperable community. Russia is one country where US IM providers are not as pervasive. We have two Russian customers who have launched their own branded IM communities and they want to open these up between all three operators to create their own shared community. It’s a very intriguing idea. But it’s a commercial decision for the operator and we’re not dependent on that. We can help operators design any kind of service based on the strong metrics we have about commercial services in the market.
We also have customers who are driving a few projects from a presence-enabled address book, giving users one access point to all of their communications; be it IM, SMS, Voice or Email – giving them the choice of how they want to communicate all from one place, from their address book. This makes it so much easier for the end user. In two clicks they can see their buddies’ status updates and availability, and make the decision on how to contact them. It’s great for IM, as users don’t need to dip in and out of the service – it’s all done from their address book.
Our customers are putting the user, and the user experience, first and many are using our Professional Services organisation to create bespoke services, tailored to what they want.
For our customers, we are their trusted partner. We’ve merged our telco grade reliability, market knowledge and technology leadership to enable operators to innovate and get new services to market very quickly.