February 17, 2009

Customer Loyalty Shifts from Provider to Device

By Linda Hardesty

Consumers are becoming more loyal to their telecommunications devices than to their network service providers, according to a 2009 Telecommunications Industry Issues Index released today.

The report was commissioned by Jajah, an IP telephony company, to evaluate how carriers view the IP communications market. It is compiled through interviews with C-Level executives at U.S. and European telcos.

Some key findings of the 2009 Index include:

• The global shift from landline to wireless is driving telcos to offer new services intended to help retain revenue.

• Carriers are increasingly concerned about the threat from competitors outside the telco sector.

• Many carriers recognize they need to drive innovation but have not been successful in developing new services to date and are now having R&D budgets cut. They need to find a route to innovation that allows them to get new products and services into the market quickly.

• Carriers are no longer looking for a "killer app" to solve their problems, but are focusing on customer retention and finding the right mix of new services.

The full report prepared by J Arnold & Associates, the analyst consultancy engaged by Jajah for the research, is available at http://www.jajah.com/press.

Jajah hopes to fill the need

In addition to releasing its Industry Issues Index, Jajah today also announced new services to enable VoIP calls to be made for BlackBerry, Windows Mobile and Symbian. Jajah announced a similar service for the iPod touch earlier this month.

The new services are intended to enable VoIP calls to be made either via Wi-Fi or over the cellular network on consumers' existing devices, said Paul Naphtali, Jajah's VP Global Marketing. The services are offered as white label solutions for carriers and non-carriers to launch under their own brand.

Naphtali said no deals with providers have been announced yet, but conversations are underway. Carriers with their own networks could deploy the service themselves. "But we also offer our own back-end solution," Naphtali said. "We can do full call termination in more than 200 countries, as well as the billing system, the payment system and customer service. A network is just part of the answer. We call it the full end-to-end solution.

"In some cases, we do tap into the last mile of the cellular network," he added. "We're not taking on the carriers. At the same time the carriers have a lot of needs to innovate with a short time to market. These are all downloadable apps that will work immediately from the device."

Asked how the makers of the devices react to Jajah's software solutions, Naphtali said, "There's been no negative response whatsoever. The truphone has a similar application on the Apple Store."

CT recently reported video applications for BlackBerry; for the full story, click here.

- Linda Hardesty

Read more news and analysis on Communications Technology's Web site at www.cable360.net/ct/news/.