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« Mobile Services Beyond Messaging? Excellent TNS Global Survey Reveals Tons | Main | Understanding OTT - Why Carriers dislike BBM, hate iMessage and fear Skype (updated) »

May 09, 2012

Comments

Tomi T Ahonen

Hi everybody in this thread!

I just landed here in Hong Kong. I wrote a piece on the plane to explain the Skype situation and the more broad OTT matter, and put it in context of such services many mention here like VOIP voice services and messenger services like BBM and iMessage. I'll get it up shortly.

I also will of course come back here to chat with you guys. Most of the commentary here has been quite civil, that is nice. I removed a few trolls and lots of spam. I also see a lot of traffic on TW about this issue.

Meanwhile there is no apology yet from John S Pope, Director of Communications at Nokia. Lets see how long it takes for him to wise up and end this silliness, haha.

Keep the comments coming! And check out the OTT (and Skype) story on the blog shortly

Tomi Ahonen :-)

N900 owner

Tomi wrote:

"That Skype exists on some other smartphone platforms (but not nearly all, Android and iPhone added together account for about 30% of the installed base of smartphones in use worldwide today) is an irrelevant point to the fact, that Elop has admitted operators hate Skype and hate Nokia Lumia because of the Microsoft Skype connection."

Ouch... basically Tomi is saying, that Android and Iphone are not the relevant competition for Lumia, because they comprise only 30% of the installed base. Therefor the fact that Android and Iphone both have skype is no argument in this debate.

But that's actually the main point here. And believe me, Android and Iphone ARE the competitors for Lumia. Nothing else. Period.

Stoli89

So, by this logic the carriers must LOVE iMessage, Facetime, and Google voice.

Hoista

@N900 owner @Stolli89

The point isn't he 30%, the point is Skype is across multiple platforms including desktop which means their active userbase is super high, which means they are more likely to convert 'paying' customers of operator services to a lower revenue segment (e.g. international calls, messaging etc.).

The carriers don't love the alternatives, one of the biggest differences is that iOS and Android already have deep roots into the operators revenues, iMessage and facetime are out of the control of operators and limited by platform, google voice doesn;t have the same reach and Android is already embedded into the operator ecosystem so difficult to excise. In terms of WP... Microsoft do no have much bargaining power, and Skype is the biggest threat of all of these messaging systems.

zlutor

An other big thing with Skype if M$ turns it into de facto corporate communication standard. taking into account its position in desktop world - and especially its position in corporate world - it will most probably happen.

That is a real - if not the biggest - threat for the operators...

Peter

@zlutor

That is already happening. In our workplace the expensive conference call systems are currently just gathering dust because people will prefer using simple Skype call when communicating between offices.

Tomi T Ahonen

To all in the thread..

The follow-up blog is now up about OTT providers, explains why the Skype issue is completely in different league from iMessage, BBM etc

Enjoy

Tomi Ahonen :-)

cycnus

@TomiFan

I don't need a degree in secret agent interrogation technique to know that Elop is lying and hiding something, and his word should be interpreted as Tomi put it.

Instead of asking Tomi, why don't you ask Elop/yourself what if Tomi right, would nokia shareholder willing to take the risk? Elop is gambling with nokia shareholder money.

Prakriti

@Tomi:
Very well said--am hanging onto every word.

A suggestion, write a "short" 2000 or 2200 word article-- about "leadership failures at Nokia-- then and now":-
a. Elop blindly following M$'s interests;
b. Elop losing out prematurely revealing info to try to please bosses/shareholders
c. Elop Not understanding products Nokia's market wants NOR understanding value of patents, R & D efforts
d. Elop Not understanding telecom business in general
e. compare what was wrong with Nokia earlier

@So Vatar:
you are very right-- that WP7's limited flexibility and limited appeal to users is a bigger problem than skype.

Fan(atic)

Without fellow Finns like Tomi Ahone, we would never see 130.000 new unemployed.

In a healthy contrast to the EU-rat and M$-fanboy, Minister for European Affairs and Foreign Trade of Finland, Alex Stubb (keen user of Nokia Lumia), Tomi really genially want Nokia to fall. It will prove him right and make him a world-wide celebrity among peers.

I suspect Tomi might be headhunted to Samsung next CEO after he complete his current freelance assignment. Then again I could be wrong, also Apple would need such a inspirational and sympathetic visionary as Tomi Ahonen.

Tomi T Ahonen

To all in the thread

I just wrote the first 'Electronic Echoes' posting relating to the ill-advised personal war that Nokia Communications Director John S Pope started with me. There are tons and tons more articles, that I haven't yet even had time to read, so soon there will be more.

Meanwhile - still no apology from John. I just expedited the issue to four senior Nokia bosses. Lets see how it goes.

I'll get some coffee and come here to chat with you guys, with some replies.

Tomi Ahonen :-)

Tomi T Ahonen

Second set of replies (from 9 May)

Hi cygnus, Joe, Peter, Tomifan and vvaz

cygnus - good points yes, about differences with Apple, Android and Nokia+MS. Also yes, even in countries of number portability, not many bother to do it. There is a stickiness to the number and account.

On LG - I do think its mostly due to the feedback they are getting from carriers and their own sales staff, and they hear clearly that Android is better to get sales.

Joe - hear hear !! Yes. And it really really gets worse, the longer you hear him and see him and read his stuff, because all the flip-flops and contradictions then add up, not to mention that he seems to be willing to say just about anything to any audience with no correlation to the reality. He sounds to me, like the former Iraq Minister for Propaganda under Saddam Hussein, if you remember, so-called 'Comical Ali' - the one who said the Iraqi army was winning while the US army was taking that building haha..

As to why at Nokia now. I hadn't thought of it before you asked and there may well be a strong reason for it. Finns are traditionally known as no-nonsense truth-speakers with no small talk and reliable and trustworthy. And Finnish-born execs tend to illustrate that almost consistently (we've had our share of bad apples too haha). Elop on the other hand, is a brilliant con-artist, he is excellent at spinning the story any way he wants. He is the master propaganda man. So the Finnish investors and press and general audience were perhaps, exceptionally ill-prepared for such a big jump from the 'always tell the truth even if it hurts' school of management, to this Elop way.. I really hadn't thought of that before, Elop was the perfect con-man to come fool the Finns.

Peter - haha, really, funny, yes. Totally opposite. And yes, it is increasingly true, that the Nokia facade hides an empty shell anymore. There is almost nothing of real value or competitive edge left. They are now shutting down N9 sales for example and the 808 PureView is not going to be sold in Australia, will not get a carrier deal in the USA (effectively not sold there either) etc..

Tomifan - it seems we have for once a chance to have a serious discussion here on this comment. You seem to be at least partly serious. So yes. You first, observe very clearly that yes, my plan to save Nokia is to make it as near as possible, a slave to operator needs and whims. You interpreted my postings 100% correctly on that. It is not what I advocated before the Elop Effect and it is not a long-term optimal strategy for Nokia, it is a short term survival strategy. I do agree with the premise of your next question, Nokia should be able to explore a new long term strategic option (like you suggest Skype) and I agree with that. But specifically if Nokia tries that with Skype, it is 100% certain failure. So the idea is good, the method is wrong. Since your comment, I have now posted the OTT BBM iMessage Skype blog posting which explains why Skype is the worst route to go. I trust if you still feel strongly about that option, you'll come with reasonable comments there in that stream and we'll talk more. And if you start to bitch about why I delete some posts, when will you learn Tomifan, that is a futile path. I have my ways, you know them perfectly well, and if you stray from the topic onto nonsense stuff like bitching about my blog and my rules, your comment is totally deleted, no matter what good stuff might have been there. You have no idea how much pleasure I take in discovering a regular visitor breaking the rules here, because I know I can delete you without a guilty conscience... So isn't it about time you stop those games. We've been here long enough, you know I am sincerely here to help and assist, even where I have my obsessions..

vvaz - excellent comment and I really should go put that into the OTT blog article. Yes, the corporate/enterprise side is a relatively modest slice of total subscribers, but they have very high traffic, often international roaming etc traffic, usually far higher average monthly bills, and now OTT is taking all that too.

More comments soon

Tomi Ahonen :-)

Tomi T Ahonen

Just to Tomifan

Hey, you need to get a new nickname haha... Seriously, I was a bit harsh, now when I re-read that last comment to you. I am sorry for that. But I REALLY appreciate the way you have CLEARLY adjusted your tone here and in other threads. Hey, Tomifan, you are always welcome here to this blog, keep commenting and I look forward to our discussions. We don't always have to agree, it is in fact good for broadening the mind to disagree from time to time but I REALLY appreciate your clear effort to be 'nicer'. I will try too. Cheers ! The beers are on me when we meet somewhere in the world

Tomi Ahonen :-)

Tomi T Ahonen

More comments from 9 May

Hi cygnus, Peter, ej, So, Stephen

cygnus - funny metaphor (feed stomach vs biting hand that feeds you). And yeah, while it is bewildering to be targeted like this, it also has been good for my Twitter following haha and tons of visitors and comments on the blog.

Peter - yeah. NSN.. I actually joined Nokia via NSN, my first posting was on that side of the house (Nokia Networks way back then). but recently NSN has been a perennial underperformer for Nokia Corp. If I was the CEO, I'd get rid of NSN rather rapidly, I think it slows down the company. And a fully independent NSN could release its own abilities. I get the sense that still today its like it was when I worked at Nokia HQ, those who were on the networking side, always felt envious of those on the handset side and tried to get job offers or career changes to get to that side.. Bad for morale to have a kind of 'upstairs/downstairs' class system.

As to my blog digging into NSN, I don't see it likely in the near future, sorry.

ej - hey, YES, how did I not mention that. MMS definitely the next cash cow, now being slaughtered for Skype haha..

So - you are VERY correct, and I am sorry if that impression came across. I did not mean to suggest that the majority of Nokia's recent trouble is due to Skype. I don't even mean to suggest that most of Nokia's Lumia troubles are due to Skype. I was trying to show that carriers will rank the OTT services by threat and Skype is by far the biggest threat, and in that context, all Windows Phone and Windows 8 devices will suffer - greatly. But yes, Nokia had troubles before Elop, it has troubles in dumbphones, and it has troubles with Symbian and Meego smarphtones, and even in Lumia, many other problems hinder Lumia sales than just the Skype related anti-Microsoft boycott. Thanks for mentioning that, I totally agree.

As to 'poor Nokia' haha... Yeah. Really. And the irony is, that against all the stuff that is going horribly wrong, Nokia did have, almost still does have, the 'perfect antidote' which was MeeGo, N9 and N950... No evil Skype and Microsoft, rather the very unthreatening Intel as partner. No carrier revolt, rather China Mobile as enthusiastic carrier partner, etc etc etc.

Stephen - thank you so much. And yes the Apple vs Skype fear is a matter of degree, and the bigger Apple grows, the more its fear will also grow. Apple had a reputation long ago of being the small radical innovative rebel. But mostly in the iPhone era, Apple has been quite arrogant and even resorted to bullying - behaving ever more like Microsoft. And while Microsoft isn't the coolest brand on the planet, some of its brands are strong, espcially Xbox so the landscape is shifting. But in the big picture, Skype is an elephant where Apple would be at best a zebra sized rival haha.

Thank you all, keep the discussions going

Tomi Ahonen :-)

Strtxi

Thank you for a thorough analysis & description of the "VoIP" threat ( "V" incl Video, too) for telecom operators. You seem to not comment on the effects of Bandwidth law and Moore's law on operator costs & opportunities.

As former consultant and executive in the telecom-media-entertainment industry, I fully agree about the _traditional_ telecom operators interest to "kill VoIp" ( if they only could ) or at least slow down its spread ( might have "sinned" in that respect, too :) ).

However, I disagree with the medicine: the phenomena is too far spread and services such as Skype are too easily used by people and cannot simply be exterminated. Based also on actions of some operators ( especially those who have deep wounds from previous such revolutions, e.g. internet, international voice, loss of monopolies etc. - such as ATT in the US ), it is much more a matter of timing: WHEN to switch to new sources of income rather than trying NOT to. Most of these new revenue sources and models are easily spread sideways in business system now, thanks for internet. Trying to lock up the customer with tech means has only limited power and since there are too many players in the field, someone will take your customers if you delay your move too long.

So what would then be the best "move" to new services for operators if they cannot simply beat them ( and go on living on fat margins simply because end customer don't know of better or cannot get the better due to monopoly / oligopoly nature of telecom operators )?

IMHO: Operators need to 1. make their own services the easiest ones to use, 2. charge end customers for added bandwidth ( which becomes cheaper to deliver for them all the time ), 3. add ( with appropriate partners ) more value added services ( such as movies, books, entertainment, online cloud services for indviduals and corporations, etc. ... ), 4. make ( mobile ) SERVICE operator even more important gate keeper to the end customer.... (and finally ) N. Charge for that gate keeper role and services both the end customers AND the service providers.
Naturally they also need to keep their hold of the best knowledge ( and economies of scale ) of customer need.

For that, the operators need the help of end user equipment manufacturers AND operating system providers to help them create more value for which the customer happily pays as part of the monthly bill or for which they can charge other industries as gatekeepers. ( Simultaneously they need to use tech to lower your costs in fiercely competitive way but keep fatter portion of the extra margin for themselves ).

If this "support & enable & strengthen operators relationships with end customers" indeed is Nokia's core strategy, it means that the game is far from over for Nokia ( & Microsoft ), especially in light of what Google is doing in grabbing more and more of your privacy and turning around and using it for their benefit AND huge profit, OR Apple taking ALL that nice ( formerly operator's ) profit from that content they sell in their store ( which forms a closed ecosystem and locks the end customer to Apple, not to the operator ).

Nokia only need to do again what it did earlier with option of GMS - growt with their challenger operator customers.

Jari

P.S: Microsoft just might want to calculate if they would earn more money by giving up a vertical ( mostly physical ) delivery chain and access to end customers ( which is the main threat to operators ) and charging a much smaller fee for _services_ they already do deliver and could expand on ( os, virus, storage, games, ... ) AND invoice those services via ( trusted ) operators. They would not loosen up the knowledge and access to end user but would save hugely in delivery costs; just need to keep enough competitions there in order to not get locked in one channel, only. AND put even more effort on marketing. But this is a wholly different story, albeit part of Nokia's dilemma, too.

Tomi T Ahonen

UPDATE re Johnatnokia John Pope

John Pope came today to the Microsoft blog topic thread to continue the fight. I posted this update there, but because it relates to this unprovoked fight he started with me, I do also want to record it here, what just happened at Twitter. I will be posting a full blog about all the developments in Electronic Echoes Part 2 soon, including this of course. But for the record

John Pope just tweeted in reply to me demanding many times that he shows where I have fabricated quotes about Elop. He tweeted: "Not new & not about direct quotes at all, but twisting words into bogus ‘admissions.’ #factsvsfiction"

So John Pope is now shifting away from his May 9 accusation that I fabricate non-existent quotes, into the position that I now twist words. That is a shift. That is implicit acknowledgement that his original position is not tenable. He was wrong. He no longer holds that I fabricated, he now suggests that I twist words.

I will not deal with this LATEST accusation, until John Pope both explictly acknowledges he was wrong to accuse me of fabrication - and he apologizes. Then we can start to talk about what other accusations he has made.

I will be providing full discussion in upcoming blog posting.

Tomi Ahonen :-)

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    Tomi Ahonen is a bestselling author whose twelve books on mobile have already been referenced in over 100 books by his peers. Rated the most influential expert in mobile by Forbes in December 2011, Tomi speaks regularly at conferences doing about 20 public speakerships annually. With over 250 public speaking engagements, Tomi been seen by a cumulative audience of over 100,000 people on all six inhabited continents. The former Nokia executive has run a consulting practise on digital convergence, interactive media, engagement marketing, high tech and next generation mobile. Tomi is currently based out of Helsinki but supports Fortune 500 sized companies across the globe. His reference client list includes Axiata, Bank of America, BBC, BNP Paribas, China Mobile, Emap, Ericsson, Google, Hewlett-Packard, HSBC, IBM, Intel, LG, MTS, Nokia, NTT DoCoMo, Ogilvy, Orange, RIM, Sanomamedia, Telenor, TeliaSonera, Three, Tigo, Vodafone, etc. To see his full bio and his books, visit www.tomiahonen.com Tomi Ahonen lectures at Oxford University's short courses on next generation mobile and digital convergence. Follow him on Twitter as @tomiahonen. Tomi also has a Facebook and Linked In page under his own name. He is available for consulting, speaking engagements and as expert witness, please write to tomi (at) tomiahonen (dot) com

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