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Asia telcos should value, monetize network data

Faced with lowering ARPU and fickle customers, regional operators need to recognize the value of the data they are collecting and learn to mine the information to improve their profitability-per-user ratio.
Written by Kevin Kwang, Contributor

Asia's operators are learning quickly from their Western counterparts in terms of monetization techniques but, like them, they have yet to fully comprehend the value of the data they are collecting and capitalizing on to respond quickly and effectively to market and consumer behavior changes.

Louis Brun, senior vice president of Guavus, a big-data analytics service provider, said that around 40 percent of mobile data will be carried over Asia-based networks by 2016, illustrating the volume of data that passes through regional operators' networks now and in the future. However, not many of them understand the true value of the information and how to monetize them in their favor, he noted.

Many of the operators in the region are instead focusing on improving their marketing efforts and are becoming "savvy" in this area by learning from their counterparts in the United States and Europe, added Anukool Lakhina, founder and CEO of Guavus. They are less focused on improving network efficiencies since there is still headroom for traffic growth, unlike the network congestion commonly experienced in the US market, he said.

Lakhina believes, though, that the importance of network data will increasingly come to the fore in the future, since Asia's networks will eventually be strapped due to the explosion in smartphone and mobile application adoption.

Mining network data will also be a differentiator for operators looking to create "micro strategies" that target beyond age-based demographics such as the "golden 60s". This means combining different parameters such as those in the golden 60s demographic who like to play mobile games, for example, he said.

The need to go into finely defined consumer segments is particularly critical for operators in emerging markets, which are predominantly reliant on prepaid accounts, Bruns noted, while Lakhina pointed out that such information can only be found via network data.

Such micro strategies, the CEO stated, will help operators stem the bleeding in their bottom lines and increase profitability per user as the marketing is on an almost personal, one-to-one basis.

"Average [in average revenue per user (ARPU)] doesn't make sense in this market anymore. It just hides the real truth [regarding profitability]," said Lakhina.

Both executives' points were highlighted by Procera Networks in 2010. Then Procera executives said Asia's telcos lag behind European and American ones in understanding how subscribers are consuming data, and what devices they are on while consuming information. This, in turn, hindered them from optimizing their networks and customers having to experience compromised network experiences, they said.

Merging analytics with marketing
Guavus on Tuesday announced its acquisition of Neuralitic Systems, a mobile data-monetization and marketing-analytics service provider based out of Montreal, Canada. The financial transaction closed on December 5, 2012, and the acquisition was effective immediately, but no financial details were disclosed.

It said the combination of Neuralitic's applications for mobile marketing with Guavus' network and customer care applications would enable communication service providers (CSPs) to attain timely and actionable insights that would help optimize business operations, support data monetization, generate new revenue streams, and enhance customer experience.

"Used together, these decisioning applications democratize timely decision-making across engineering, customer care, and marketing business functions," Guavus said in a separate statement.

Asked which telcos in Asia are using the company's tools, Bruns noted Singapore's StarHub as the only telco that it is allowed to name, but there are "active trials with many others in Southeast Asia".

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