MobileActive 08: In the Elevator with Operators

In the Elevator with Operators – Pitching New Ideas to Mobile Operators
Pieter Verkade, Chief Marketing Officer MTN; Vuyani Jarana, Executive Director Regional Operations Vodacom; Moderator: Jesse Moore

Some lingo:
– A.R.P.U.: Average Revenue Per User/Unit (eg. UK $40/user/month, SA $15/user/month, elsewhere Africa as low as $5/user/month)
– Churn: subscribers lost per month (lower in developed countries with contracts)
– Acquisition cost: cost per new customer
– V.A.S.: Value Added Services (core: voice, SMS, some extent data)

Started with fairly lengthy discussion on expenditure and investment made by oeprators. Started with discussion on how volume is often the most important issue. Capacity is determined by peak demand, so operators try to drive volume to non-peak times. When building base stations, take into account financial, strategic as well as social concerns.

New services. Key issues: enhance revenue; provide strategic value / brand differentiation to operator; contribution to acquisition / retention. Then go to second tier detail: interface with open / existing standards; cost of implementation and maintenance (including, eg., the training of sales people); service activation costs over many users. For example, 3G networks: will lose money for a while, but long term value and retention.

Other interesting aspect of mobile networks: huge on-the-ground presence, including in very poor areas, through dealer / airtime sales presence. When looking at marketing to all areas, need to make technology simple to present, and focus on developing small businesses around the network.

On making pitches: first tier is obviously the above issues, but after that simplicity is a key factor, especially in projected uptake.

Nothing hugely unexpected so far. Unfortunately, I had to take a call now, so I missed the discussion part.