Time to Talk "Connectivity-as-a-Service"

By Mika Skarp

Consider this very common occurrence. You waltz into a mall or coffee shop, and before you've even looked at the selection, never mind plunking down your money, you've already scanned for their free WiFi. Note: This order is very important as anyone who's ever bought a coffee in a "no free WiFi zone" knows. If you haven't, you're one of the lucky ones, and increasingly so since most public places have free WiFi, even hiking paths on the way up mount Everest! But WiFi is never really free is it? Though you won't see it as line item on your next Starbuck's bill, like the heating, air conditioning or lights in your favourite coffeeshop you can bet that it's included in your purchase. "Would you like a refill sir?"

Indeed, free public WiFi has become a competitive must and a key to the sticky buyer experience the vendor wants to create. And the moment you step out of that walled garden you're back in the cold, cruel world of your cellular network where you pay and pay some more. This is the very opposite of Connectivity-as-a-Service. In the free (but not-so-free), one-size-fits-all WiFi network the costs are covered and recouped elsewhere. In the cold cruel cellular network you pay for every byte however it gets delivered. And as consumers become increasingly price sensitive and Smart Phone usage becomes less dependent on a cellular service, CSPs need to start rethinking the way service is delivered and paid for.

Enter Connectivity-as-a-Service. In an age of "All-Things-as-a-Service", where software, apps, content, platforms, IT and even the cloud get served up for an elastic monthly fee, we're not only ready for it, but in dire need of it.

We've spent a good amount of time in the pages talking about how to off-load cellular capacity demand to WiFi, but what about the reverse? How could we offer cellular network capacity for free?

Several bushels of hair and telecom generations ago this was a hot topic, largely pushed in the mobile advertising space. But this is not the kind of model we are talking about. Here we're suggesting a different kind of scenario and one that operators would do very well to look at very seriously. While the idea of a "something-as-a-service" has become rather loose, it holds to a few basic principles across the board. The essence of the movement is the idea that rather than paying a large fee from the get go, the upfront costs of the service (be it a data subscription or even weekly hot sauces delivered to your door), users or businesses enjoy the benefits of the service right away without breaking the bank. Think record of the month club. The total cost is covered for the level you've signed up for. And if you're thinking "well, aren't cellular services like that already?" think again. In fact, and when it comes to cellular service turn the whole concept on its head.

We're all used to standard X-as-a-Service models, but take a look at Uber or Airbnb. Their users are all subscribed for free and then pay according to the level of service - the length or timing of the drive (remember surge pricing?) or the square footage of the hot tub in the case of Airbnb. In cellular networks we can imagine a scenario where your starter subscription may include basic phone service and some data that's provided for free. These features would allow for simple use like local calls and synchronizing text and photos on a best effort basis. However if you want to up the ante and start streaming you'd have to pay additionally, and if you go for HD video streaming pay a little more. And as uninterrupted display of increased resolution on larger screens was required you'd have that at your fingertips on-demand for a fee.  So here we'd see a model where basic service was free, just like public WiFi, and anything else would cost you a little extra.  As we well know, our demand for mobile data is nothing if not dynamic, even chaotic.

But as we said at the outset, people don't like to pay and they especially they don’t like surprises. Remember the case of the 400 page iPhone bill? So in order for the kind of Connectivity-as-a-Service we're dreaming of to fly, these instant upgrades (if we can call them that) should be something we can use every day without thinking too much. In a nutshell, cellular connectivity and particularly video streaming should be akin to other monthly utilities we use like housing, rent, and electricity etc. And just like in those examples, consumers should have options that provide for differentiated cellular data services that can be accessed at will and even bundled in the same way WiFi is bundled with your muffin and coffee.

Why is this important? If you are a telecom operator providing fixed and mobile services, it really does not matter if people are using WiFi or Cellular data as long as they are using more data. But if you are an operator focused solely on providing cellular service you may be missing both the boat and the forest for the trees. IoT is coming and nothing is going to stop it. Spoty WiFi simply won't cut it and will have to move out of the way.