Guest post by Shira Levine, Directing Analyst, Next Gen OSS and Policy, at Infonetics Research

As we approach the end of 2011 and I try to summarize the top trends of the year, three words keep flashing into my consciousness from countless PowerPoint presentations, trade show signs, and conference agendas: customer experience management. Suddenly, the customer is a hot topic, and how to manage him has been fodder for endless conversations of the last year—and, dare I say, a certain amount of hype.

What exactly is customer experience management (CEM)? It depends on who you’re talking to; there’s no standardized definition put out by the 3GPP or the TM Forum. A network management or test vendor would probably discuss CEM in terms of service management, while a CRM or billing vendor would frame it in the context of customer care. Nor do operators seem to have a universal sense of what CEM means, with varying views based on factors such as the competitive environment and regulatory requirements, and even variation between the departments of a single operator.

My personal opinion is that CEM is all about understanding how the subscriber wants to interact with his/her CSP, and acting accordingly. That could mean an acknowledgment and an apology after a certain number of dropped calls, and possibly even a credit. It could mean personalized advertising and promotions based on past usage. Or perhaps it could mean interacting with the operator via a social networking site such as Twitter or Facebook, or through more traditional means. I think CEM is about giving customers options, and letting them make decisions about their services.

And though CEM does indeed have a lot to do with customer care, billing, and service assurance, policy management plays a huge and often underappreciated role. Policy may have once been all about bandwidth control, but the next generation of policy management solutions is focused on how operators can offer subscribers more targeted and personalized services with demonstrable value—characteristics most operators’ service offerings sorely lack.

Take most data plans as an example. We all know by now that flat-rate all-you-can-eat data plans are unprofitable and unsustainable, but operators looking to transition to tiered billing models face subscriber backlash—in large part because customers question the value of tiered plans. For them, a tiered plan means a bucket of bandwidth per month, without a way to understand how that translates into usage, and a constant worry about exceeding that quota (and incurring overage fees) or under-using the bandwidth and leaving that money on the table.

Policy management allows the operator to add context to those new service models, by correlating service requirements with available bandwidth and presenting that information to the subscriber in a way she can understand. Rather than selling subscribers buckets of data, an operator could sell a movie package that includes four HD movies each month with guaranteed quality of service plus a set number of hours of Internet browsing, or market a service to Twitter junkies that exempts traffic from social networking sites from monthly quotas. Or in the case of a shared data plan—the subject of a white paper I recently co-wrote—a family could share a certain number of movies or hours of online gaming or Internet usage across devices, as opposed to a bucket of Gigabits each family member pulls from.

Why, then, aren’t more operators deploying these new service plans? It’s certainly not a technical issue—these business models are all feasible, given the relative maturity of the commercially available solutions. I believe the stumbling block is the far more pervasive one of service provider mindset. CEM is a giant paradigm shift; the service is no longer about what the network can support, but about what the customer wants. For this to occur, operators need to break down their traditional internal silos—departmental silos, network silos, service silos, etc.—and work more collaboratively, sharing information and solutions. Until that occurs, the term “customer experience management” is likely to remain a buzzword instead of becoming a reality.

About Shira

With 15 years as an analyst and journalist in the telecommunications industry, Shira Levine joined Infonetics Research in April 2009 an accomplished expert in the OSS, billing, and service delivery platform markets. She authors several Infonetics equipment market size and forecast reports on policy servers, service delivery platform (SDP) software and services, and subscriber data management (SDM) software and services, as well as an ongoing series of Continuous Research Service (CRS) notes and surveys on important communication industry players, technologies, and service provider trends.

Guest Post By Richard Webb , Directing Analyst, Mobile Devices, at Infonetics Research

As the analyst responsible for tracking the mobile broadband devices market at Infonetics Research, I have been asked to participate as a judge for the smartphones category at the Mobile World Congress industry awards taking place in February 2012.

As I considered where to place my vote, I had to consider each phone’s functionality, aesthetic appeal, performance, value-for-money, and other criteria. This became increasingly tricky, because not all smartphones are trying to appeal in the same way to the same user. This sounds obvious, but of late, differentiation in this segment has become much more marked due to the market entrance of a new breed of smartphone.

A Segment Emerges: The Low-End Smartphone

Previously, all the focus of innovation in the smartphone market had been at the top end: making smartphones even smarter, faster, flashier . . . and more expensive. Functionality comes at a price and the drive from vendors had been to exceed the capabilities of its competitors, confident in the belief that early-adopters would not be able to resist.

But this focus has changed. Not completely, because of course there is still much attention being paid to making smartphones better than ever: the dream of the ‘ultra-smartphone’ (whatever exactly that might mean) still spurs vendors on to new heights. But there is now a discernible counterpoint to the likes of the iPhone and the Galaxy: the ‘low-end’ smartphone.

With the emergence of smartphones such as the Huawei Blaze, Motorola Defy and the ZTE Skate, launched this year at price-points around $150, the focus is no longer on maximizing functionality, but optimizing functionality: the low-end smartphone doesn’t try to do everything, but instead does enough. Enough, that is, for people for whom the array of capabilities of smart smartphones, and also the cost, is excessive. The low-end smartphone competes on price, not on being a cutting-edge must-have gadget.

This shift of emphasis acknowledges there is a degree of overkill in the segment – many smartphones are capable of far more than we ask of them. But higher functionality might be equated with lower user-friendliness –  smarter phones are fine, but if we do not use all the functionality we are paying for, does this represent value?

Barriers to Mobile Broadband Adoption Are Lowered

Cheaper smartphones are appealing. Not only do lower prices bring these smartphones into the price range of a larger potential market, but less functionality actually makes them appeal more. Focusing on a basic range of features (email, browsing, MP3, photos, applications) can be a good thing; these are the features most used by the majority of smartphone users. High-end features such as 3D video are not for everybody, and over-complexity can be a barrier to adoption.

Low-end smartphones should combine well with the emergence of shared data plans to drive mobile broadband adoption. In a recent whitepaper by Infonetics Research (All in the Family: How Shared Data Plans are Driving New Requirements, October 2011 ), we noted that mobile operators will offer plans giving users a ‘pool’ of data to be shared between multiple devices, or multiple users, to give greater flexibility in terms of usage and devices.

As smartphones get simpler and cheaper, users want more devices, but not necessarily more data plans. Not only are separate data plans per device expensive, they also frequently give users a higher total data allowance than they can actually use; however, shared data plans and low-end smartphones share a synergy that counters this: value-for-money.

Infonetics forecasts that approximately 15% of all smartphones will be sold as part of a shared data plan by 2015. It will become an increasingly important method for selling smartphones, particularly for new mobile broadband adopters looking for simplicity – exactly the demographic for whom low-end smartphones might appeal.

One Day, All Phones Will Be Like This!

This is not a ‘dumbing-down’ of the smartphone segment, just a focus on optimizing smartphones in terms of the right functionality at the right price point for the right market segment. At some point all mobile phones will be smartphones. With low-end smartphones driven by Huawei and others, we are certainly getting closer to that reality.

As for which smartphone will win the Mobile World Congress award . . . find out in Barcelona in February 2012!

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About Richard

Richard Webb is a highly sought-after analyst, consultant, writer and speaker who has been covering telecom markets for 13 years, including WiMAX since shortly after its inception in 2001, making him one of the industry’s foremost WiMAX experts. As a directing analyst with Infonetics Research, Richard authors and co-authors numerous market share and forecast reports, service provider surveys, and Continuous Research Service (CRS) opinion pieces on WiMAX, LTE, 4G, mobile broadband, FMC, microwave, mobile backhaul, and phones and devices (mobile, FMC, WiFi, smartphones).