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BLOG: Head, shoulder and tail

Arnaud Delorme | Dec. 5, 2011
Go-to-market strategy for mobile apps business

o        The shoulder of the Value-Volume apps curve is the middle zone - where both existing and new partners can help to address new vertical industry opportunities, such as healthcare, travel, finance, etc. For these apps, platform exposure and a high-touch collaboration is needed between the strategic partners and the service provider. A SaaS (software-as-a-service) model works well here, with a focus on simplified integration, easier on-boarding of external partners and reduced development time and cost. Operators need to create an ecosystem where value is created for these partners as well, e.g. through co-branding. Monetisation results from offering these more differentiated and personalised services, and through the use of multiple, flexible business models: from a simple pay-per-use model, a tiered user volume, or flat monthly fees.

o        The long tail of apps only requires a low-touch strategy: Operators "just" make the network easily accessible for independent Web, mobile and widget developers. This is more of a self-service model where simplicity is the key word, where the service provider offers capabilities in a wholesale model, and where new distribution channels can be created. Making it simple for developers to start using the network APIs (application programming interfaces) is key to achieve mass adoption (by well documenting them, for instance). Usage-based pricing models work best here. 

Although engaging long tail developers can enable innovation at the speed of ideas, this type of apps is also the most difficult one to get a grip on and should not be the main priority for the operators when kicking off their apps strategy. The community of long tail app developers is very fragmented and scattered all over the world. Moreover, service providers usually need to build the skills for exposing and documenting APIs in a simple way. As long tail apps are not generating large revenues in the short term, they should be part of a longer-term strategy - with the support from top management.

Arnaud Delorme is Alcatel-Lucent Asia Pacific's regional head for applications business.


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