'Google & Facebook shouldn't use networks for free' -- Total Rubbish

Good morning from the Costa Coffee at London Heathrow’s Terminal 5. That’s me back in London now. I spent most of my time in Hong Kong this week doing interviews so I hardly had any time to look at anything else.

I did manage to briefly laugh-out-loud at the suggestions by some serious people in the mobile operator sphere that service providers such as Google, Apple, Yahoo and Facebook should help contribute toward the costs of maintaining their networks.

If you missed the reports, The Telegraph has a nice write-up.

In the piece, the top chaps at Telecom Italia and France Telecom — seriously, I kid you not — went on record. Here’s one of the quotes:

And now telecoms operators want the companies behind these devices to contribute towards the upkeep and improvement of the mobile network.

“Service providers are flooding networks with no incentive [to limit bandwidth],” Stephane Richard, chief executive of France Telecom, told Bloomberg. “It’s necessary to put in place a system of payments by service providers as a function of their use.

Utterly preposterous.

The reason there’s demand for the data in the first place is, in large part, due to these service providers. Facebook has done more to sell mobile data plans than almost anything else in recent years.

It gets worse, though. Are you ready for a statement about just how misguided these old beans in the mobile operator space are?

Here’s another quote, this time from Telefonica.

And Cesar Alierta, chief executive of Telefonica, complained that companies such as Google and Yahoo! used his company’s networks for free, “which is good news for them and a tragedy for us”.

Cesar, you should be ashamed of yourselves.

“Use our networks for free” — you what?

What do you mean *they* use them for free? What about the consumer who’s actually typing in ‘google.com’ into their handset and accessing the service using a data plan for which they’ve paid you good money?

It’s this kind of backward, looney, highly misguided thinking that I simply cannot stand.

How about this for a solution? Why don’t we take Facebook, Google, Yahoo, MSN and every Apple service, and let’s stick it into it’s own private MNO. Right? Those services for which these geniuses are moaning about, let’s put them behind a firewall and make them only available to the subscribers of this new mobile operator.

What do you think the consumer will do?

It’s pant-wettingly stupidly obvious.

Indeed, if you’d like to see just how bad the mobile operator dynamic really is, all we need to do is announce the iPhone 5’s general availability and make it clear that it’s only available on Network X, Apple’s new Mobile Network Operator.

The consumer would migrate in a flash.

The consumer isn’t using Telefonica.com to search. No. They’re using Google, because the company has invested billions to make sure the service is pretty sweet. Likewise, they’re not using TelefonicaBook are they? No, they’re using Facebook. Because of the value Facebook offers them.

Bleating about the network demand is highly traditional, though.

It’s not solving a problem, is it? No. It’s not looking at the underling issues and innovating the problems away is it? No. It’s lazy — and I find it downright offensive.

Of course all-you-can-eat data doesn’t necessarily work for all consumers, especially when you find that 80:20 rule (i.e. 20% of users are consuming 80% of available networking resources). I can’t stand it when I see a teenager sitting on a bus with his iPhone streaming — or attempting to stream — a 600mb file from BBC iPlayer or YouTube. Despite the phenomenally bad service, he’ll just keep on waiting for the buffering message to disappear, he’ll watch 10 seconds. Then wait for another 30 seconds while the buffering continues. And, of course, my simple web browsing speed is nailed because the local cell tower is having to deal with him, me and a few hundred others.

I don’t think limiting people to 500mb or 1,000mb is the answer at all. Nobody knows what this means. It’s a stupid yardstick introduced by a silly, silly marketplace as this post by Ben Smith outlines. Instead — as Ben points out — allocating people at network speed limitation would be far more useful.

Give the teenager 20k/second included in their standard network subscription fee.

Give me and Ben 500k/second if we stump up £15/month, more if we choose to pay you more. As Ben puts it, sell speed, not volume.

Then start getting smart.

I obviously use Google services on my mobile devices a lot. Tons of times every day. Likewise a host of other similar services.

Why not charge me for priority access to them?

Go and talk to Google, Telefonica. Ask them for a super-direct connection to one of their local geographic data centres. I’m sure Google would be delighted to peer directly with you, so that there’s no ‘internet’ cost. Put some fibre between the Telefonica hub and the Google data centre. Same for Facebook.  And then, charge for it.

Anyone who’s paying the standard fee, route them via the normal slow internet connection.

Anyone who’s paid for priority mobile internet access, route them via your super-dooper priority mobile data system. That will allow you to do some really funky data styling and management across your network, on a predictable and certain basis.

And now you’re really adding value to me as an end user. So sell me tiered access based on speed and then give me the option of a priority booster so that whenever I access google.com, I know it’s being delivered to me super-super fast.

Too complicated? To difficult? I saw some twitter discussion recently whereby some industry geniuses were pointing out that it’s “rather difficult” for mobile operators to manage their network delivery and that it’s “quite complicated” to deliver services such as dynamic tiering and so on.

Well that’s not a valid answer.

The mobile operator game has changed. Data is becoming increasingly relevant to the consumer, prompted by the explosion in services. So get with the programme, Mr Mobile Operator. Wake up. It’s not just about telephone calls and SMS. The value added service providers like Amdocs, Bridgewater and Nokia Siemens Networks are waiting for you. It’s time to invest heavily. But it’s also time to charge properly.

Consumers will pay for this. They’ll happily do so, provided they feel like they’re getting value. I can see a time where a consumer who’s paying a fiver a month for ‘slow’ data would choose to upgrade to medium or fast speed because it means (amongst other things) that they get Facebook quicker, faster, better. There’s a lot of education going to be required.

Blaming someone else because your customers are ‘using too much’ is crazy. Look closely at the underlying trends, recognise the world has changed and construct your billing plans and your network infrastructure accordingly.