Should you Joyn the club?

The GSMA-backed rich communication service initiative Joyn has been heralded by GSMA as the answer to the threat operators have faced to their communications revenues. However, the service has split opinion among the industry’s forecasters; some are encouraged by the progress the service has made, whereas others believe it is too little a step taken too late. Albeit from a standing start, Joyn now seems to be gaining momentum; in recent weeks, Spain’s big three operators have thrown their weight behind the cause, along with SK Telecom in South Korea, which takes the number of markets where the service has been launched to four.

One thing is clear: success for Joyn is dependent on mass adoption from operators as well as their customers. If consumers cannot connect with all of their friends using Joyn, they will simply use a different service to communicate with them. They will not accept, particularly if they are paying a premium for the service, that it may work with only a quarter of their friends, for example.

I have had the opportunity to witness a first-hand demo of Joyn, courtesy of Jibe – the Silicon Valley start-up which is developing applications and technology for the initiative. And I was pretty impressed by the functionality. Being able to have a real-time video chat with your friends while playing a multi-player game, editing documents or sharing photos is something I can certainly see consumers getting used to. It removes fragmentation from the communication process; rather than sending a picture and then phoning a friend afterwards to talk about it, or editing a document and then discussing the changes that you’ve made, it makes perfect sense to do all of this in real time. From a consumer perspective, this feels to me like a natural next step for communication services.

Pricing could present a stumbling block, though. If this is supposed to be an attempt to provide a supplementary messaging revenue stream for operators then the service must somehow be monetised. Movistar in Spain has already launched its service free of charge, and according to Amir Sarhangi, CEO at Jibe, operators are going to have to take a leap of faith on this one.

He says that the Joyn initiative presents an opportunity to get back into the communications game, and to do this, they need to change their mentality. Rather than asking what the business case is before pledging an investment they should instead take a leaf out of Google’s and Apple’s books, he argues.

“[They] are nimble companies; they’ve first gone out to get the consumer attention and then figured out how to monetise it. You don’t always have to have a clear financial model beforehand,” he says.

Having said that, he speaks of a future where the carrier could offer a bundled package for a selection of three Joyn-enabled apps, for example, for around £5 per month, and the operator would prioritise the customer’s traffic while they are using these apps. But if operators want to charge for this service, they will first need to hook consumers in and get them dependent on using it.

I just cannot see all operators taking such a leap of faith, when they have enough investment and service development to manage already. Many web businesses have taken this kind of leap over the last decade and recent history is littered with the names of those whose faith has not been rewarded. Some very big names, meanwhile, continue to struggle with their business models. Much will depend on the ability of the GSMA and its most powerful members to whip up widespread support. And even that may not be enough.

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  1. Avatar Nikki Brown 11/01/2013 @ 12:51 pm

    We also compared the pricing models of the inital few joyn launches globally. Will be very interesting to see consumers reactions. But ultimately, operators need to entice subscribers first, then ensure they like the service and see its value over and above other perceived to be ‘free’ OTT applications – then they’ll have more power re pricing. Visit our blog The Art of Messaging for more details: http://theartofmessaging.com/2013/01/04/the-right-price-to-joyn/

  2. Avatar Tom Veldman 11/01/2013 @ 3:18 pm

    Although the term ‘leap of faith’ seems quite appropriate to me in the context of RCS, operators investing in a new mass market service that combines the reach of SMS and the richness of IP Messaging is by no means a leap in the dark.

    In today’s market, the fee for person-to-person communication services such as RCS must be “hidden” in the operator’s package in order to achieve massive uptake.

    As a consequence, the direct revenues from RCS will indeed be low but, probably much like Google and Apple, operators will be able to create significant new (indirect) revenue streams off the back of the RCS user base. Global brands are quite eager to use (and pay for) RCS as a rich channel to reach out to their consumers, in promotions, loyalty campaigns or for delivery of content and entertainment.

    This ecosystem concept is very much designed into the RCS initiative, with the GSMA recently launching the joyn Innovation Challenge to stimulate mobile and web app developers to explore ideas for new and attractive services on joyn/RCS.

  3. Avatar Cathal Fitzpatrick 23/01/2013 @ 1:39 pm

    In reality, GSM operators do not have to make the same “leap of faith” that a web-based business with no existing billing relationship with users has to do when launching RCS.

    There are a number of reasonable and viable approaches that an operator could take to monetize RCS as a revenue-generating service.

    – Messaging and voice (RCS 5) usage could be deducted from standard subscriber bundles.

    – Use of the App could be based on a monthly service charge

    – Advertising could be displayed on the client during various subscriber interactions.

    – Access to RCS users could be extended as a premium service to external companies for application such as Customer Care, Account Checks, Payment Processing etc.

    RCS gives operators a means to defend against further OTT encroachment by offering an improved set of communication services that can be charged for using normal business approaches but which also support newer business models. It is not a “leap of faith”, it is a concrete step forward for operators to a richer and secure future.

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