Telefónica steals march on Joyn with TU Me

Telefónica Digital, the innovation arm of the Spanish incumbent telco, has offered its first retort to the third party messaging apps like WhatsApp, Skype and Viber that are threatening operator business models. The TU Me application enables rich communications between users on any network, mimicking the functionality of OTT applications and tying them to the subscriber’s phone number. It has much in common with what is expected of the RCSe collaboration Joyn, which was announced by Telefónica with other leading operators in February.

The application will initially be available for iOS users, with an Android version in the works. It can be used regardless of network, as long as a wifi or data connection is enabled, but will be marketed as part of a bundle for users on its O2, movistar and Vivo branded networks. Telecoms.com notes that the operator said the app will be “free to use at launch,” and “will continue to be developed with added value functionality,” which suggests premium functionality—and associated pricing—is in the post.

Users of the application can exchange text messages, make calls, leave voice messages, share photos and location information. Unlike Skype however, users cannot yet call circuit switched lines, so all communication is within the boundaries of the application itself. Interactions are stored in the now popular timeline format with all content stored in the cloud so that it is always available whenever users log into the app.

“We’ve seen the growing popularity of communications apps on smartphones but we believe we’ve gone one better with TU Me using our knowledge and insights of how people use their devices,” said Stephen Shurrock, chief commercial officer at Telefónica Digital.

According to Informa, the likes of WhatsApp and Facebook Messenger among other OTT services are set to take almost four per cent of voice and messaging revenues from the mobile operators in 2012. And while the operators can’t afford to lose this money, they also can’t afford to lose the relationship they have with their customers.

A compelling user experience is essential but making the service cost free is also likely to be important as this is what consumers already get from OTT players. This makes Telefónica’s hint at some kind of ‘TU premium’ a potentially tricky issue.

Yet Dario Talmesio, principal analyst at Informa, believes the carrier is quite right to think about a monetisation model which can be implemented further down the line. While the service as it stands does not have any unique attributes and is largely an OTT copycat that has appeared two years behind the pack, there is scope to integrate it with other operator run cloud services such as storage facilities, Talmesio said. He added that rich communications offerings make interaction more fun and therefore more sticky.

The TU programme shifts more traffic from the voice to data, which seems somewhat at odds with plentiful reports of operators struggling with data traffic and the lowering of data usage ceilings.

Although it is app-based, from a functionality perspective TU foreshadows the network-based Joyn RCSe initiative, announced by the Spanish offices of Telefonica, Vodafone and Orange as well as T-Mobile and Telecom Italia at MWC in February. In a bid to stave off the threat from the over the top players, the five carriers are banding together to deliver their own brand of rich communications candy to their existing subscriber bases.

At MWC there was much speculation as to whether this plan was a last ditch bid for service supremacy from the operator camp. The TU offering launched by Telefónica today stands in direct competition with what is planned for Joyn, yet will likely in future be run in parallel. This is not the first time that Telefónica has pushed out its own version of a product on which a collaborative effort is in the works. O2 UK recently unveiled its mobile wallet service, while its Project Oscar JV with Vodafone and Everything Everywhere remains held up by EC investigation. Interestingly, TU, like the O2 mobile wallet, is designed to appeal to subscribers of competitor networks as well as Telefónica’s own customers.

Telefonica will be speaking at Global Messaging World Congress 2012, to be held in London on the 19-20th June 2012: http://globalmessagingcongress.com/