The growing irrelevance of the operator: Now I just need connectivity

I’ve been a little silent here on Mobile Industry Review lately because I’m slightly bewildered by the new reality sweeping across the marketplace. I’m sure it’s familiar to many readers — that is, your operator is almost completely irrelevant to you nowadays.

It’s been a reality that’s slowly established itself in my mind. Of course I’ve always been happy to utter emotive, “these guys are toast” statements for many years, but it’s always been underpinned by the possibility of a change of strategy.

The death of operator relevance was demonstrated clearly in my own personal dealings with the UK players. I was spending about £500 a month with accounts on every network — contract accounts — so I could test the latest and greatest services. And then it occured to me: Why do I spent £50/month with O2? Why am I bothering?

My primary account is on Vodafone. I got to the point where I couldn’t tell the difference.

So I dumped the O2 accounts. With zero ceremony. There was no attempt to retain my business. I told the efficient customer services chap via internet chat that I didn’t need the lines any more.

He simply said (words to the effect of) “Ok” and gave me a termination date. What he did do is swap both accounts to Pay-as-you-go so that I won’t be marked as “lost” to O2 until about September time when the 2 PAYG sims I’ve received expire.

There was nothing the chap could offer me to stay. Shocking.

There was no attempt to discover whether they could switch my other business to O2. Or could they promise me a new iPad? Or a subsidised ‘whatever’? No. Nothing. They simply let me go.

And the worst part of it? This suited me perfectly fine.

Over at 3, I had to dick about myself getting an upgrade to the iPhone 4S. I really don’t know why I bothered. I ended up — at their request — paying off my existing 3 iPhone 4 contract with the proceeds of the sale of that device. I had to sell it myself. Then I established another contract for the iPhone 4S. The sales agent was delighted as it made his figures look better. I should have thought better and just bought the iPhone 4S. There was no additional value offered by 3 in this whole transaction. Indeed I was helping them out.

Over at Vodafone, I called them to terminate two additional contract lines that were irrelevant. I think, if I search deeply within my consciousness, the reason I still had them going was to feel good. You know, way back years ago, spending “a lot” with an operator was a good thing. You got better service, a few extra perks, handset discounts, that sort of thing. Now each contract line is judged on it’s individual merits. So there’s little point in me having them “to hand”. The sales agent explained I needed to terminate the lines in writing. Utterly flipping stupid. I sent an email as requested and was promised an answer within 2 business days. 10 days later I called again and the lady I spoke to just cancelled the lines there-and-then.

No attempt to retain the spend. No attempt to upsell. Again, this suited me fine.

And that’s what has been irking me.

I don’t appear to be able to buy anything more from these operators.

If anything, thanks to these new “unlimited everything” price plans, the only way I will be spending more with my operator(s) is:

– if I want additional lines
– if I am a crazy user of data
– if I roam abroad

I find this astonishing.

I’m the edge case, though. I recognise this.

I have an iPad 2 on contract from Vodafone. It’s got at least another year to go. I’m currently about to sell that to Envirofone. I’ve bought the new iPad already, directly from Apple. That revenue and additional contract commitment should have gone to Vodafone or one of my other operators. Instead it’s disappeared.

I’m still a Vodafone customer. But that’s only a temporal issue, relating to the last contract I established with them for the iPad (setting aside the fraudulent one that still hasn’t been rectified).

Right now I don’t see any value between the operators. They’re now merging into one for me. They’re simply connectivity suppliers. Previously I held them in a greater light. I felt I got more than just the brand. I’m not sure precisely what I was thinking.

For quite a while I’ve been suggesting all sorts of possible actions from contracting to deliver all my IT requirements (eg £150/month for an iPhone, iPad and MacBook Air) or some kind of special “Vodafone Black” account that gets you into airport lounges and charges 5p a megabyte for international roaming. Or five SIMs with one number. And so on.

We’ve obviously seen next to no additional action from the operators beyond their continued desire to stick to the knitting, flogging the PAYG horse and doing their best to move all contract customers on to 24-month agreements to try and put off the pain.

Certainly the average consumer doesn’t think like me. The most they’ve noticed is that the handset subsidies appear to have all but disappeared and that contracts are now 24-months. Meanwhile they’ve begun spending steadily via their mobile devices on everything from eBay to Dominos to Amazon and Apple. And meanwhile the dominant message from the operators has been “buy a phone (from us, maybe), choose a price plan, goodbye”.

They’ve nothing more to offer.

Indeed if you look at the product and service mix from the operators, I don’t think we’ve seen this change since the introduction of GPRS data as a new offering.

The price has certainly changed — downward.

But that’s it.

Zero innovation. I’m speaking broadly of course. There’s the odd little nod to “new stuff”.

Broadly, though, they’re still busy selling minutes and texts and megabytes. I can’t tell the difference now.

I’ve an iPhone on 3 and an iPhone on Vodafone. I seriously can’t tell the difference. They both cost the same. Three has a slightly better data price (ie “unlimited”) but that’s immaterial to me and most of the world especially since the network isn’t good enough to handle iPlayer at HD on the train. I’ve got WiFi at home and work.

I really don’t care who provides my electricity at home. As long as it’s there and the cost is largely “reasonable” I have don’t care. I’m surprised to say that’s now precisely how I’m feeling about mobile operators.