Google voice

To any analyst that is taken by surprise by the annoucement Google adds voice to its portfolio: shame on you! Telco's however, might see their future revenues on voice disappear in the Google business model.

To me, this is one more step compliant with several trends:

firstly: consumers vote with their feet instead of acting according to the wishes of the marketing department (takes one to know one). Just take a look at trends like Long tail or user generated content: creating value in the digitized world is very closely linked to consumer behaviour. This profoundly affects many business models (both in terms of creating value and in servicing customers). For a deep insight in the presures relating to this you might like to read Jonathans L. Zittrain's 'The Future of the Internet'.

Secondly: now that consumers have taken the steering wheel again, they are served by any organization or company that assists them with helpfull tools. That's where several free services come into play, ranging from Facebook's to Google's search service. No need to eleborate about web 2.0. The point is: this trend is not about the price but about users fullfilling their needs themselves. For a nice description of this trend please read Tapscott & Williams's 'Wikinomics'.

Advanced notions of this trend are to be found in the field of sociology and philosophy since this basically is about human identity and human interaction. Don't forget to dive into recent developments in in the field of Human Resource Management (they focus on the characteristics and needs of different generations of workers to optimize business performance. Don't be mistaken: a new generation of workers is a new generation of consumers as well).

Thirdly: now that consumer initiative has shifted, this trend affects businesses that create value by selling traffic (capacity on their single core product) to many prospects. The main pressure is put on the exclusivity of their core product, be it transporting voice, data, money or online contents. So, discussion arrises in the realm of intellectual property ownership and rights (IPR), the net neutrality debate or the great fuzz about telco's becoming dump bitpipes.

Advanced notions of this type of issues are to be found in future network architectures (4G modelling) or, with an even broader scope, the future of the nation state. Note that, while this may seem a little far fetched, this is basically about who's King and who's not. Pressure on core strenghts is something that nation states have been experiencing for decades. The case of the demise of the state is well known in the field of international relations. They like to define it as asymmetrical warfare (a.k.a terrorism) or economic protectionism. It seems to me that the ongoing struggle of nation states against influences of (international) businesses or international organisations (both legal and illegal) bear resemblence to Skype versus AT&T, for example.

Fourth: then WHO ís King? Well, it's certainly not content as has been made clear by Andrew Odlyzko's famous article. In my opinion, it's also not the 'closed' businessmodel (read Wikinomics again if you like) or closed societies - for that matter.

Let me start by adding to the first part of this argument in paraphrasing: IT'S THE PEOPLE, STUPID (made bold for marketeers and/or policymakers). Put in a somewhat sophisticated manner; it might be wise to dig into the possible convergence of democracy and economy, which immediately raises questions about linkages with ecology and religion (in no particular hierarchy). Later more on that.

(Next time, back to P2P banking)

banking with telco's

just noticed this post about mobile payment UI and M-Pesa in Afghanistan. It occurs to me that development of alternative banking in western Europe can't keep up with other areas.

Possibly, a lack of effective (payments-) infrastructure adds to the opportunity of raising new business models in developing areas. However, I'm not sure whether this 'backwardness' is actually the case. Many industries start to display really high standards (in terms of quality and effectiveness).

Anyhow, since banking is in the 'tight spot' and communicating is not, there are opportunities in the western hemisphere as well. For example, I wonder if P2P money transferring will take off if centralized banking by telco's or banks takes too long.

More on P2P banking later on.

bye bye banking (part 2)

let's take a closer look at existing payment scheme's such as premium SMS. Several aggregators connect a variety of content-sellers to the Telco billing engines. When a consumer decides to send a message to a paid-for shortcode, the transaction is done. A subsciption or single piece of electronic content such as a time limited link to a wap/web site is distributed to the cellphone.

Behind the scenes, revenues are devided by all parties, but generally the telco takes the biggest share. Given the lack of real competition compared to the aggregators or content parties, this shouldn't surprise anyone.

The aggregator has a central position in this scheme. It connects merchants and telco's similar to role of the payment service provider in e-commerce. Now given the existence of aggregators, trusted parties and systems, much depends of the customers.

Case studies of mobile banking show that user-trust and general acceptance of payments by merchants are crucial. However, little generativity is to be expected from competing telco's. The same holds for banks, which leaves us with the aggregators.

I propose a mobile payments clearing house. This institute should esthablish trusted relations with al parties concerned. It should act as mobile payment service provider for merchants. At the other side of the scheme it would be tied to both telco's ánd banks.

While I propose a single institute for clearing transactions, the transaction itself can be done by a variety of methods. All to often, the debate of mobile payments has focus on payment methods. Those methods, such as Near Field Communications, are integrated into schemes also involving clearing of payments, such as electronic wallets like minitix. This type of integration hampers universal use of the system in much the same way as does the obligation for shop owners to purchase expensive NFC enabled payment terminals.

Variety of means, single payment clearing with a variety of institutions could allow for a bright future of payments without banks.

[later more on banking with telcos's]