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  • Key Factors That Determine a Winning Application Store Strategy for Operators

    Since its launch over 2 years ago, Apple’s App Store is redefining the way consumers are using the Internet. Apple has created a phenomenon and industry experts forecast application stores will become a billion dollar industry with revenues expected to exceed $25 billion by 2014.

    Juniper Research estimates that by 2011 the majority of all applications-related revenue will originate from applications delivered via applications stores. And this trend will continue, with the contribution of 4G (both WiMAX and LTE) giving subscribers the opportunity to experience better mobile voice and data services, via application stores.

    Operators should be happy. They are supporting this boom by providing the connectivity, marketing and customer care to the subscribers downloading the applications. However to date, operators are not enjoying increased revenue for their efforts.

    Whilst data yield is increasing for operators, ARPU has been on a steady decline. Operators’ networks are being used to download and access applications but the operators themselves are seeing returns. Which is why, in recent months, operators have begun exploring ways to adopt the App Store model to gain full control over their revenue and subscriber base.

    However, the challenge lies in how operators can ensure that subscribers will purchase applications from them and how an operator can add value compared to its competitors, device and platform vendors?

    Source: Juniper Mobile Applications & Apps Stores Business Models, Opportunities & Forecasts 2009-2014

    The Winning Application Store Strategy

    Operators are only just beginning to realize that they have the existing assets to support their goal of launching an application store. By using the right avenues to tap into these assets, operators can fast track their venture into this exciting, profitable space.

    There are 7 key factors that determine a winning application store strategy for operators.

    I. Connectivity

    Simply said, connectivity is the fuel required to transport any application to subscribers. Connectivity forms the very foundation, without which any application store, regardless of how cool or entertaining it is, cannot operate. Operators must realize that they are in possession of an essential sector of the application store ecosystem, and this sets them on the right path to owning their own application store.

    II. Integrated Ecosystem     (Applications Management, Billing & CRM)

    A successful application store should place emphasis on both the front-end and back-end mechanisms, particularly the applications management, billing and CRM.

    CRM Capabilities
    On the front end, the system serves as a platform to push applications to subscribers. It is an online shopping mall that hosts various types of applications and it is the very place subscribers interface with the operator’s application store.

    Hence, the front end should be managed carefully to meet the demands of subscribers.

    This is where the operator has an advantage as they are the only entity within the ecosystem with a holistic view of subscribers’ lifestyle patterns based on their profile and purchase history. The operator’s CRM system provides an abundance of subscriber data which would assist in channeling the right applications to the right subscribers, at the right time.

    It’s important for the application store system to be equipped with artificial intelligence that integrates with the operator’s CRM system to leverage on the wealth of subscribers’ behavioural information.

    Based on this information, operators have the opportunity to make compelling recommendations to subscribers and meet their demands for personalized content.

    Ready Billing Mechanism
    Another advantage that operators have is a ready billing system, which includes options for prepaid and postpaid payments as well as flexibility in offering interesting rebate packages. This enables operators to differentiate from other players such as Apple, which typically has a less feasible or preferred billing options. The application store system should easily integrate with operator’s existing billing system, allowing a single point of access to manage billing.

    Applications Management
    At the back end, the application store system should be built to support an automated cycle of certifying an application. The right flow should be implemented to ensure applications submitted by content developers are properly scrutinized and tested before releasing to subscribers.

    This relieves operators from the manual process of managing applications and, at the same time, ensures all deserving applications are made available to subscribers. In short, deploying an application store is about creating a whole ecosystem to support, develop and provision applications both online and at the device level.

    III. Hassle Free Billing System

    Operators have an established and trusted billing relationship with their subscribers. With prepaid and postpaid payment options, paying online with credit cards no longer needs to be the settlement medium. This enables all subscribers to enjoy applications without worrying about security and fraudulent risks, which is one of the main factors that deter them from shopping online. Application purchases can be charged directly to the subscriber’s scheduled (eg.monthly) bill.

    Meanwhile, having a direct billing relationship with the operator puts the subscriber at ease. In the event of issues arising from the purchase of applications, subscribers are able to reach the operator for assistance and settlement.

    IV. Focal Point of Access

    A successful application store must consolidate all value-added services and applications within a single platform, hence subscribers benefit from a focal point of access. Distance to purchase must be reduced and free previews should be made available so that subscribers are given an opportunity to evaluate an application prior to purchase.

    V. Location-based Content

    Operators can offer more localization compared to application stores owned by device manufacturers or operating system vendors as the local operator understands their own market and subscribers’ demands. With this service differentiation, operator-owned application stores would generate more demand for applications and keeps the ecosystem healthy.

    According to research conducted by ComScore, the number of people who sought local information on a mobile device grew 51% within just one year (from March 2008 to March 2009). ComScore defines local content as "searching for information on maps, movies, business directories or restaurants."

    Among the various local content categories, the number of people accessing online directories has seen the greatest increase during the past year, at 73%, followed by restaurants at 70%, maps with 63%, and movies with 60%. This further strengthens the need for localized content. Usage of applications like coverage maps, traffic updates, and restaurant recommendation not only enhances a subscriber’s everyday life, but keeps them coming back for more, thus driving demand for the entire application ecosystem.

    VI. Multi End User Device & OS Support

    Operators are faced with the daunting expectation of providing applications/services that can be supported by multiple devices, across all platforms with a consistent user experience. This gives all subscribers an opportunity to indulge in the application store regardless of the device or operating system used.

    For example, Apple’s App Store is only confined to iPhone users. This means that unless they purchase an iPhone they cannot enjoy the applications.

    Operators now have the chance to break this monopoly and offer a similar experience to all subscribers via the operator-owned application store. Synchronization capabilities between multiple devices further enriches user experience.

    Aside from subscribers, a cross-platform application store is a stronger incentive for content developers as they are assured that their master pieces reach a wider target audience.

    VII. Fair Game for Developers

    It is widely expressed that the visibility of applications residing in Apple’s App Store has been a great disappointment to content developers. Apple’s practice of ranking applications by price drowns premium applications, while cheap and free titles receive a more preferable placement. With thousands of applications out there, an effective application marketing mechanism needs to be in place to give all applications a favourable selling ground. An application should have the opportunity to compete in its own space, ranging from popularity, rarity, uniqueness and pricing.

    Kelvin Lee is the Senior General Manager of Green Packet Berhad

  • Requestec Provides Bell Mobility with 3G Mobile Video Calling App for Facebook

    Requestec, an Adobe Flash-to-SIP telephony provider, announced their key involvement in the release of Bell Mobility’s, Bell Video Call application built on the Facebook platform.

    The application allows Facebook users to visit the profile page of a Bell subscriber that has added the application and click on their Bell Video Call tab. From here, calls can be made from anywhere in the world to the Bell subscriber’s HSPA Video Calling handset; all at no cost to the caller.

    The company claims it’s the first video calling application in North America that is fully integrated into Facebook.

    The application is available to Bell Mobility subscribers with video calling capable phones on the new HSPA network.

    “We were approached by Bell Mobility about the possibility of incorporating video-calling functionality into Facebook. This was our chance to show the world our technology within the Internet’s leading online community, Facebook,” said Requestec’s CEO, Marek Zwiefka-Sibley.

    According to Bell, its the new HSPA network (launched last month) covers 1.2 million square kilometers, reaching approximately 20,000 Canadian towns and cities and 93% of the population. It offers mobile speeds of 21 Mbps.

    Over the last 4 years Requestec has been focusing on developing Adobe Flash-based telephony solutions built on the Zenon Telecommunications platform. In 2008, the company launched Voixio, one of the world’s first web-based no-download Flash-to-SIP telephony services.

  • VeriFone Announces iPhone Secure Payments Solution

    VeriFone announced PAYware Mobile, a payment solution for the iPhone that brings card processing capabilities to small businesses.

    According to the company, PAYware puts “mainstream payment processing capabilities” in the hands of small business merchants who need a mobile card acceptance solution for enterprises such as home repair, small cafes, door-to-door sales, or virtually any other type of business.

    The solution includes a PA-DSS approved payment app and a card reader that slips over the iPhone to accommodate card swipes and allow merchants to avoid “card-not-present” fees.

    The card reader utilizes a secure magnetic stripe read-head and firmware certified to the Federal Information Processing Standard FIPS 140-2. Card details are immediately encrypted during the card swipe process, meaning no sensitive data ever reaches the payment app, eliminating the possibility of compromise either on the iPhone or when information is transmitted over WiFi or cellular wireless.

    Transactions initiated by PAYware Mobile will be managed through VeriFone’s PAYware Mobile secure gateway and routed to one of many credit card processors for authorization and settlement.

    VeriFone assures that the combined hardware and software provides “the strongest card payment security available for the iPhone”, including the company’s VeriShield Protect encryption solution as a standard feature.

    The solution will be available through existing bank acquirer and ISO channels, as well as direct from VeriFone. The company says they also expect to eventually make PAYware Mobile available wherever mobile phone accessories are sold. Customers who sign up directly with VeriFone without existing merchant accounts will be directed to a “variety of payment processor options”.

    The hardware and software solution will begin shipping January 15 and is available free to those who sign up for a PAYware Mobile secure gateway service agreement.

  • IDC: 450 Million Mobile Internet Users Worldwide in 2009, One Billion by 2013

    There were more than 450 million mobile Internet users worldwide in 2009, a number that is expected to more than double by the end of 2013, according to IDC.

    IDC’s Worldwide Digital Marketplace Model and Forecast finds that most popular online activities of mobile Internet users are similar to those of other Internet users: using search engines, reading news and sports information, downloading music and videos, and sending/receiving email and instant messages.

    Over the next four years, IDC expects some of the fastest growing applications for mobile Internet users will be making online purchases, participating in online communities, and creating blogs.

    Accessing online business applications and corporate email systems will also grow rapidly as businesses move to empower their mobile workforce.

    Highlights from IDC research include the following:

    • More than 1.6 billion devices worldwide were used to access the Internet in 2009, including PCs, mobile phones, and online videogame consoles.

    • China continues to have more Internet users than any other country, with 359 million in 2009. This number is expected to grow to 566 million by 2013. The United States had 261 million Internet users in 2009, a figure that will reach 280 million in 2013. India will have one of the fastest growing Internet populations, growing almost two-fold between 2009 and 2013.

    • Presently, the United States has far more total devices connected to the Internet than any other country. China, however, is the leader in in the number of mobile online devices with almost 85 million mobile devices connected to the Internet in 2009.

    • Worldwide, more than 624 million Internet users will make online purchases in 2009, totaling nearly $8 trillion (both business to business and business to consumer). By 2013, worldwide eCommerce transactions will be worth more than $16 trillion.

    • Worldwide spending on Internet advertising will total nearly $61 billion in 2009, which is slightly more than 10% of all ad spending across all media. This share is expected to reach almost 15%% by 2013 as Internet ad spending grows surpasses $100 billion worldwide.

    "With a wealth of information and services available from almost anywhere, Internet-connected mobile devices are reshaping the way we go about our personal and professional lives. With an explosion in applications for mobile devices underway, the next several years will witness another sea change in the way users interact with the Internet and further blur the lines between personal and professional," said John Gantz, chief research officer at IDC.

  • VocalTec Acquires Outsmart

    VocalTec, a provider of carrier-class multimedia and voice-over-IP solutions, announced that it has acquired substantially all of the assets of Outsmart, a provider of telecommunications convergence solutions.

    The Outsmart assets acquired by VocalTec included Outsmart’s technology and intellectual property, as well as its primary customer and partner contracts. The company says the engagement by VocalTec of certain Outsmart personnel “is intended to enable the continued development and support and an uninterrupted transition to all Outsmart customers and partners.”

    VocalTec provides trunking, peering and residential/enterprise VoIP application solutions that enable deployment of next-generation networks.

    Outsmart is a mobile solutions provider of convergence technologies. Its flagship product, the Plug ‘n Talk solution allows mobile operators to reach out across national borders to tap into new user segments.

    Based on its Smart Convergence Platform, Outsmart enables operators to converge between mobile and VoIP.

    According to VocalTec, Outsmart’s mobile VoIP and Intelligent Network products are a strategic addition to VocalTec’s existing portfolio of VoIP solutions. The combined portfolio positions VocalTec as a provider of VoIP solution and applications to both fixed line and mobile service providers.

    "Fixed & Mobile carriers are repeatedly forced to lower their rates. The competitive field is becoming so crowded that the only solution they have is to “go IP” in order to lower their cost. VocalTec is a dominant player providing VoIP end-to-end solutions to service providers," said Ilan Rosen, Chairman of the Board of Directors at VocalTec.

    Jacob Bros, CEO of Outsmart, claims VoIP technology will play a major role in revolution in providing cross-geography services. “And as such teaming up with VocalTec will position the technology of Outsmart in the forefront of the industry," he said.

  • VoIP Investment Remains Strong, IP Line Penetration Rose to 40% in Q3

    According to the recent Canalys report on IP telephony, investment in enterprise telephony remained restricted in EMEA in Q3 2009, with call control line shipments down 17.5% compared with the same period in 2008.

    The research shows volume declined 21.5% in Q1, while Q2 was down 18.6%. In total, 4.8 million lines were shipped in the quarter, a 4.4% sequential increase. IP line penetration increased to 40%, up from 35% one year earlier, as businesses continued to replace aging TDM infrastructure and expand trial projects.

    Canalys claims aggressive cash-back, fixed price, minimum spend and competitor trade-in promotions, as well as 0% financing offers have helped prevent greater reductions in shipments during 2009.

    Alcatel-Lucent, Siemens and Aastra continue to lead in EMEA, with Cisco gaining ground.

    ‘Alcatel-Lucent has been a stable performer in the region over the last eight quarters, overtaking Siemens as the market leader in 2008,’ said Alex Smith, a Research Analyst at Canalys.

    ‘During the recession, it has managed to maintain its market share, though its Q3 shipments were hit by the holiday season in its core markets, particularly France, Spain and Italy,’ Smith added.

    Siemens remained the second largest vendor with a market share of 13.5%, though this has steadily eroded over the last two years. Overall, Siemens is continuing to invest in growing its indirect business, but shifting direct accounts to the channel will take time, according to Canalys.

    In September, it announced plans to accelerate this process by selling its direct sales organisations in 27 non-core countries to Netlink, a deal worth €204 million ($308 million), more than the original €175 million ($275 million) the Gores Group paid Siemens AG for its 51% stake in the overall business.

    Aastra was the third largest vendor in the region, with a market share of 13.0%. During the quarter, Aastra benefited from competitor cash-back trade-in promotions in France, while investment in direct-touch activities helped it improve its German business, finds the report.

    Cisco continued to grow its market share during the recession, primarily driven by gains in Western Europe, particularly in Germany where it has invested heavily in marketing and sales resources. It accounted for 11.6% of total shipments, compared with 11.2% in Q2 and 10.3% in Q3 2008.

    Avaya, which grew its shipments by 4.2% over Q2 with strong sales in the UK, catalysed by the release of IP Office R5, won the auction for the Nortel Enterprise business. Canalys says new entity has the potential to emerge as the leading vendor in EMEA.

    ‘Shipments for the final quarter of 2009, typically the largest in EMEA, are expected to grow sequentially but will still be down annually as many businesses set budgets earlier in the year when economic conditions were worse. Year-on-year growth is expected to resume in 2010, though volumes will still be lower than in 2008 as economic recovery is expected to be slow after the worst recession for decades,’ said Matthew Ball, a Senior Analyst at Canalys.

  • IDC: EMC Led The Overall Storage Software Market in Q3

    According to IDC’s Worldwide Quarterly Storage Software Tracker, the worldwide storage software market experienced another decline in year-over-year growth in the third quarter of 2009 with revenues of $2.87 billion, representing –7.9% growth over the same quarter one year ago, but a 1.2% growth from the previous quarter.

    IDC report shows EMC led the overall market with 23.4% revenue share in the third quarter of 2009. Symantec held onto the second position with 17.8% revenue share, while IBM finished in the third position with 12.2% revenue share.

    NetApp finished in the fourth position with 7.6% revenue share while CA rounded out the top 5 with 3.9 revenue share.

    For the second quarter in a row, only two of the top 5 vendors displayed a positive growth over the previous quarter. EMC and IBM displayed positive growth rates of 5.7%, and 6.9% respectively, while Symantec, NetApp, and CA each had negative growth rates from the previous quarter of –2.1%, –8.9%, and –3% respectively.

    “Two out of the top three vendors in the data protection and recovery market grew sequentially (IBM and EMC) while the leader Symantec declined at 1.2%,” said Michael Margossian, research analyst, Storage Software at IDC.

    Symantec is still the market leader with 31.1% market share, and IBM and EMC having 14.1% and 12.8% market share respectively.

    EMC regain the top spot in the replication market, with 10.7% growth over 2Q09, while NetApp declined 10.1%.

    “The storage software market was barely able to maintain a positive sequential growth rate in the third quarter of 2009,” concluded Margossian.

  • Seagate Introduces Its First Enterprise SSD: Pulsar

    Seagate introduced the Seagate Pulsar drive, the first product in its new enterprise SSD family.

    Designed for enterprise blade and general server applications, the Pulsar uses SLC (single-level cell) technology, delivers up to 200GB capacity, and is built in a 2.5-inch form factor with a SATA interface. It leverages non-volatile flash memory rather than spinning magnetic media to store data.

    According to Seagate, its new SSD achieves a peak performance of up to 30,000 read IOPS and 25,000 write IOPS, 240MB/s sequential read and 200 MB/s sequential write.

    “Its SLC-based design optimizes reliability and endurance and helps provide a .44% AFR rating with a 5-year limited warranty. As an additional safeguard, the Pulsar drive leverages Seagate’s enterprise storage expertise to protect against data loss in the event of power failure,” the company says.

    The drives are available in 50GB, 100GB and 200GB capacities.

    “Our strategy is to provide our customers with the exact storage device they need for any application, regardless of the component technology used. We are delivering on that strategy with the Pulsar drive, and you can expect additional products in the future from Seagate using a variety of solid state and rotating media components,” said Dave Mosley, Seagate executive vice president.

    Joseph Unsworth, research director at Gartner said, “The enterprise SSD market is now primed and well-positioned for growth from both a revenue and unit perspective, with Gartner estimating unit growth to double and sales to reach $1 billion for calendar year 2010.”

    “Superior enterprise SSDs provide transformational capabilities when optimized in storage and server environments,” he added.

  • Boxee and D-Link Unveil The Boxee Box

    At the Boxee Beta Unveiling event in Brooklyn, Boxee revealed that D-Link has been named first choice as the hardware partner to release a Boxee Box – Boxee branded set-top box.

    The device brings HDMI-support, WiFi, Ethernet, an SD card slot and two USB 2.0 ports. It also comes with optical audio, RCA audio and RF remote and plays any non-DRM media.

    According to the companies, the Boxee Box, which has already won a Best of Innovations award from the Computer Electronics Association, “reinterprets what TV should be, delivering all the movies, TV shows, music and photos from a user’s computer, home network and Internet to their HDTV with no PC needed.”

    The full product will be shown at CES 2010 and it is supposed to hit the store shelves in Q2 2010 for about $200.

    Boxee social media center, and its free, open source downloadable enables to stream content from websites like Netflix, MLB.TV, Comedy Central, Pandora, Last.fm, and flickr.

    Boxee is in public Alpha for Mac, Linux, and Windows. This Monday the company launched the Beta and plans to open it up to the public on Jan 7th (also at CES).

    The company say its eventual goal is to let users integrate Boxee into their existing devices (TVs, game consoles, STB, and DVD/Blu-Ray players) where possible or to buy a Boxee Box if their existing hardware can’t run it.

    After launching in June of 2008, boxee has nearly 700,000 Alpha testers. In addition, dozens of content providers have built applications for their content on Boxee and a 3rd party developer made boxee available for the Apple TV.

    In 2009, the company hopes to reach 1 million users across computers, AppleTVs, and other devices that can be connected to a television.

  • Symantec Enhances Veritas Storage Foundation

    Symantec announced enhancements to Veritas Storage Foundation, Veritas Cluster File System and Veritas Cluster Server, the heterogeneous storage management and high availability solutions for UNIX, Linux and Windows environments.

    According to the company, this release enables organizations to capitalize on new storage technology, such as solid state drives and thin provisioning, “while continuing to reduce costs and complexity through improved performance and scalability.”

    Additionally, near instantaneous recovery of applications is now possible with Veritas Cluster File System through tight integration with Oracle, Sybase and IBM DB2 –allowing for “fast failover of structured information and near linear scalability.”

    “With this launch, Symantec is providing customers with the ability to effectively utilize the latest storage innovations—from SSDs to thin provisioned hardware and even virtual environments including Hyper-V—while also providing capabilities needed to optimize any storage or server platform,” said Josh Kahn, vice president of Product Management, Storage and Availability Management Group, Symantec.

    Storage Foundation automatically optimizes heterogeneous storage environments, including those that contain both SSDs and traditional disk storage. Symantec claims Storage Foundation is the only storage management solution that can automatically discover SSD devices from leading array and server vendors and optimize data placement on SSD devices transparently.

    The firm also claims its Veristas File System is the only cross platform, thin-friendly file system in the industry. It enables improved storage utilization by integrating with the thin provisioning ecosystem.

    Announced last year, the Veritas Thin Reclamation API enables automated space reclamation for thin provisioning storage arrays and is now fully supported by Symantec partners IBM, 3PAR and Hitachi Data Systems.

    Storage Foundation’s SmartMove technology together with Veritas Volume Replicator makes it easy for enterprises to migrate from thick to thin storage over any distance, as Symantec claims.

    Only the storage that is being used by the application is moved, making data and array migrations fast and efficient even across wide areas.

    With this release, Symantec also adds enhancements to Cluster File System and Cluster Server, providing improved availability of Oracle environments.

    “In contrast to traditional failover approaches, which require both application and storage to move to an alternate server, Cluster File System and Cluster Server provide concurrent access to information and require only the application to be moved,” said Kahn.

    As a result, organizations can now failover applications running single-instance Oracle or single-instance IBM DB2 “in seconds.”