Openet finds people are losing their faith in OTTs

Research commissioned by BSS vendor Openet found the Facebook data scandal has affected overall trust in digital service providers.

Just over half of the 1,500 people surveyed in the US, UK, Brazil and Philippines said they were less likely to share their data with an OTT (i.e. big internet company) as a result of the data scandal that hit Facebook with the Cambridge Analytica revelations. This trend also applied to free digital services in general as people have apparently got the memo that companies don’t just give stuff away without expecting something in return.

Openet’s narrative is that this represents an opportunity for operators to present themselves as a more trustworthy source of digital products and services. We had a chat with Openet CEO Niall Norton and he described a potential role for operators as the providers of a seal of trustworthiness equivalent to ‘fair trade’ labels on consumer goods.

“Until now, digital service companies like Netflix or Uber have been held up as the poster children for delivering personalised digital experiences and services,” said Norton. “But it seems some have been a little too liberal in their use of consumer data, ruining the party for everyone.

“Since the Facebook data scandal, consumer attitudes towards digital service companies and personal data have eroded, with some consumers even deleting accounts in protest. In fact, many have expressed an interest in paying for services if it means that their data won’t be abused, signifying an end to the ‘freemium’ era. Consumers are clearly screaming out for something different, something trustworthy.”

Of course Openet has a vested interest in this narrative. It has been undergoing a strategic pivot over the past couple of years to position itself as the vendor operators can turn to if they want to do something about the OTT threat. Norton explained that billing itself isn’t the strategic play it once was and that operators need to get better at things like analysing data and partnering with other digital service providers to get with the times.

“Mobile operators have traditionally had a much more conservative approach in their use of subscriber data, despite having an abundance of it,” said Norton. “For a long time, this conservative approach to data use has been used as an unfavourable measure for operators’ digital efforts, especially in comparison to other digital-first companies.

“But times are changing and it’s clear that consumers expect more if they are to hand over personal data in exchange for services. Mobile operators have earned the right to answer this call. But to be successful, they must learn from the mistakes made by social media and digital service companies alike. Transparency around data collection and opt-in processes are now top priorities for consumers. Operators must bear this in mind when seizing new digital opportunities.”

Here’s a summary of some of the findings from the report. Even if they deliver everything they claim, vendors like Openet can only take operators part of the way. They’re still wrestling with colossal cultural inertia and creating new digital services is never going to be a core competence. But the trust angle does seem to have some legs, if only operators can work out how to exploit it, but in a good way.