Mobile business strategy

Lecture 2

The mobile businessenvironment

• Mobile business is a broad definition that includes communication, transactions, and different valued-added services that are made available by using portable devices

• Another essential definition of “mobile commerce” is that it is referred to as “transactions with monetary value, conducted by mobile Internet.”

Wireless world

The wireless world is a complex environment consisting of different and competing technologies.• WiFi• HiperLAN• Bluetooth• ZigBee• WirelessUSB• Ultra Wide Band• WiMAX

WiFi

The first WLAN (wireless local area network) standard offering the capability to connect wirelessly to LAN; this technology developed rapidly with a wider offer of bandwidth (Gratton & Gratton, 2004).• Strengths:

– Expanding existing network without cables; – expanding network where cables are difficult to install,

rapidly evolving with users’ need; – largely used and close at hand;– one of the fastest wireless technology

• Weakness:– Difficult set up and configuration

HiperLAN

This technology is used in Europe and provides a different set of wireless communication specifications providing WLAN support. It is also compatible with 3G, enabling voice, and imaging communications (Gratton & Gratton, 2004)

• Strengths:

– WLAN support provided, data rate of 54 Mbps, the 3G applications support

• Weakness:

– Located only in Europe

Bluetooth

From the name of the Viking king Harald whose aim was to join together the Nordic European territories, a cable replacement technology to overtake the messy cables around laptops and desktops. Infrared was also engineered to tackle similar issues (Gratton & Gratton, 2004)• Strengths:

– Can be incorporated in many products and devices, low cost resulting in cheaper products, can make use of low power schemes, ease of use for consumer

• Weakness:– Small data rate available, uses the same frequency as

other devices

ZigBee

Introduced to disseminate a large range of products and devoted to businesses willing to develop wireless products. It works with IEEE to set up a new standard (Gratton & Gratton, 2004).• Strengths:

– Low power consumption and cost, affordable wireless solutions, fast wireless development, avoids coexistence

• Weakness:– Uses the same frequency of other

technologies and may overlap with Bluetooth

WirelessUSB

Short-range wireless technology operating on the 2.4 GHz unlicensed spectrum; developed by Cypress Semiconductors to gap fill Bluetooth shortcomings (Gratton & Gratton, 2004).• Strengths:

– Low power consumption, affordable wireless solutions, allows fast wireless development

• Weakness:

– There are restricted applications, uses same frequency of other technology, mostly unknown and not widely available

Ultra Wide Band

The FCC in the U.S. recently approved this technology, which is similar to Bluetooth, but can travel a distance up to 230 feet through obstacles by using minimal power. Currently two types of application exist: radar and voice/data communications

• Strengths:– Low power consumption, can overtake

obstacles, its radio waves travel further

• Weakness:– Early development stage and mostly unknown

WiMAX

• Represents the next evolution in broadband wireless technology and will be backed by Intel. This new technology, designed so that it does not require line of sight, should allow higher-speed downloads over much longer ranges than WiFi.

• WiMAX should have clear advantages of speed and simplicity over 3G technologies for in-vehicle entertainment, flexible CCTV, and security systems; WiMAX devices could represent a user’s second or third broadband connection

Location-based services

• Micro-Payment (Coca-Cola vending machines in Finland use SMS payment)

• Gambling (lotto, instant games, and sports)

• Intelligent Advertising (receive advertisements via SMS or MMS)

Approaches to mobile business

“MAGIC” (by NTT DoCoMo)– Mobile– Anytime– Globally– Integrated– Customized.

Ericsson developed the “0-1-2-3” approach:– 0 written manuals– 1 simple button to the Internet– 2 seconds of delay waiting to access the service – 3 keys to gain access to services and features

Mobile business roadmap to success

• Porter’s 5 Forces Analysis (Porter, 1980)

• SWOT (strengths, weaknesses, opportunities, and threats)

• Do the assessment twice:– firstly at higher level (macroeconomic

level)

– secondly at lower/specific industry level (micro-economic).

Five lenses to see mobile

• Mobile business can be analyzed into five different wedges: – movement, is the most obvious, as movement or

changing places– moment – more simply, time (possible to

manipulate passing time, planning, scheduling, and postponing, and even multitasking)

– me – remarkable amount of customization features (ring tones, colored screensavers, covers, and accessories)

– money (mobile phone that can easily replace wallet and coins, and enable mobile banking)

– machines – many mobile devices that can perform different tasks

Marketing dimensions

OWNERSHIP Personal phone, business phone,

parents’ phone, supplementary

phone

CONTACTS Few, many, random

LOCATION National, overseas, movers, and

shakers

TIME Weekday, night, day, weekend

BEHAVIORS Mostly caller, mostly receiver,

sending data, images, files,

music, call backer, avoider

Value chain for the wireless business

Network

• Back end system

• Web and WAP server

• Internet

• Mobile network

Technology

• SW development

• Payment and security solutions

• SW platform

Content

• Provision

• Applications

• Aggregation

Interface

• Portals

• Devices

Customers

• Individuals

• Companies

• Institutions