I like the look of the new Telstra Digital Business bundle, even though like many (most) people I'm not a fan nor an advocate of my telco provider. I'm certainly not about to Like them anywhere in the social ecosphere!
I don't Like you but the others are probably worse - I fear
I'm a "hostage" customer in that I think the couple of other "competitors" are just as bad if not worse. Telstra has earned it's share of the rising number of complaints to the Telecommunications Industry Ombudsman (but to be fair its proportion of the complaints has fallen). And the marketing telebabble which all the players indulge in has been likened to Orwell's 1984 doublespeak - it's decidedly scammy but that's the world in which their marketing departments live.
So despite in the past having to endure up to 6 hours on the phone trying to rectify my accounts (they eventually offered me $500 to "settle" one blunder) I have "registered my interest" in their new Digital Business offer.
What is the real "natural market" for telco business extensions?
The future for telcos is a hot topic and the big events on this get the attention of the top people, especially if Tomi Ahonen is on the stage!
That's because it's not so obvious. For example, personally I don't buy the argument that telcos are the "natural owners" of cloud computing services and that this will be their new salvation.
Over the last decade telcos have said to be the natural owners of many things - web hosting, general hosting, media, entertainment, sports, SMB services, SaaS portals, systems integration services, enterprise software services, buying groups, trade exchanges, trade markets, trade directories, trade forums - but few if any have had any traction despite the billions poured into these initiatives globally.
Let's face it, although the "app store" and "iTunes" was invented and commercialised by Japanese carriers 5 to 6 years before Apple the telco world elsewhere universally proved to be the dead hand which crushed such initiatives, and others such as mobile payments.
Apple didn't innovate iTunes, it innovated out of the dead hand of the telcos
Apple's innovation wasn't in iTunes or the app store, they were proven models in Japan, it was in taking control out of the dead hands of the telcos and music companies. That was a true commercial innovation. And I suspect Apple will also take control of a broader payment system as well. In these respects telcos universally are duds and they've lost those races.
Telco 2.0 provides industry research and strategy, and their model has 6 "opportunity types". Telstra's Digital Business initiative lies across 2 of those types - Vertical Industry Solutions, and Embedded Communications. The bundle comprises:
- New voice calling features: including an "Auto attendant" redirecting calls to fixed phones in up to three locations and mobiles;
- High-def call quality – SME voice-over-broadband;
- Sophisticated voicemail – fixed and mobile voicemail messages are collected in a single hosted voice box and can be forwarded to staff as email or SMS;
- New pricing – businesses pay a ‘per user' fee rather than "per phone line", with a flat rate for services including hosted email;
- Free calls - all voice calls between phones on a Digital Business account including mobiles are free of charge;
- Domain Registration - access to professional email and web addresses;
- Hosted email via Microsoft Exchange Online - real-time and synchronised email, calendar and address book information across computers, laptops, tablets or smartphones;
- Broadband back-up service via the Next GTM network – can switch businesses automatically to wireless in the event of a fixed network outage.
I'm sure that there are many similar bundles offered by telcos elsewhere, and this stikes me as an attractive package to small businesses like mine. If the rumoured entry price of $120 per user per month is correct then that is attractive, subject to the detail. I'm paying almost that much now just for my mobile phone. (And if Tesltra would add in virtual fax then it would be a real winner.)
Scaling is always the killer because the channel is the choke
The $64 question for Telstra is how can their distribution channel cope with a product of this "complexity". After all just signing up for a mobile phone has the channel extended to its limits. It doesn't matter to me personally, as long I as I can sign up without too much grief. But in order to achieve scale the digital and the retail engagement model will need to be designed and executed with care and a lot of attention to operational excellence and digital engagement.
I'm not about to Like Telstra, but I am looking forward to the detail of the new offer, and I'll very likely sign up. If they get it right then Telstra will suck the wind from the sails of many of the smaller existing IT service providers to the SMB market, particularly the "Medium", and that's something which which should be keeping these providers awake at night. Don't bet on Telstra's previous incompetence, if nothing else their price point is going to crunch the market.
It's not as if relationships don't have a strong role. The smaller service providers have this advantage with their current customers. It's just that at some stage the value offered by the local service provider falls below the value created by the low price point of offers like Telstras.
I actually hope that Telstra can deliver as if it is well done it will help small business productivity with the suite of integrated services. It's a sign of "cloud" productivity and economics hitting the mass market.
Are you a user of a similar bundle, from your telco or elsewhere?
What natural markets do you see for telcos to extend into?
How threatened should smaller IT service providers feel by these kinds of bundled offers?