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SP360: Service Provider

ABC.jpgAnticipating market direction and innovating for the future can yield big results. In my earlier post, I emphasized how service providers, in order to become experience providers, need to follow the ABC’s: Adopt a Connected Life, Boldly innovate business models, and Change the equation. This entry will focus on boldy innovating and will highlight several providers in the US market. 15 years ago, Comcast was just a cable company delivering video. But in the past several years, Comcast has made big bets on triple play offerings to include high-speed Internet access, digital video and digital voice. As a result of its desire to innovate and transform its entire business model, Comcast has produced excellent financial results and grown its subscriber base. In its July earnings report, over 670,000 digital voice customers were added in Q2 alone, with over three million digital voice customers added in two years. Comcast CEO Brian Roberts said earlier this year:”-we’re providing customers with superior products in a compelling triple play package that is clearly driving growth-we continue to be very bullish about the future and expect the strength and momentum of our business to continue to deliver this kind of growth for years to come.”Comcast formed an alliance with Sprint to offer a unique experience called Pivot, enabling an end user to watch Mobile TV channels on their Sprint handset, check e-mail, and make unlimited mobile calls to their home phone. On the horizon, Comcast is looking to offer over-the-top services as well as serving the commercial market. Looking at the evidence, I’d say Comcast is well on their way to becoming an experience provider.Verizon has chosen to innovate along the lines of entertainment, expanding its business model from traditional voice offerings, offering a variety of innovative experiences, and growing its customer base. Verizon’s FiOS service enriches the lives and homes of its customers; the Verizon”ultimate play” monthly bundle offers experiences that include digital TV, broadband Internet services, as well as mobile services that play upon Verizon Wireless assets. In July, Verizon reported over 500K FiOS TV customers, as well as 1.1M FiOS Internet customers, along with its 60M wireless customers. Verizon continues to evolve itself into an experience provider. AT&T’s innovation took the form of a strong partnership with Apple, as well as a willingness to evolve its image and focus. AT&T’s chairman/CEO, Randall Stephenson commented that the iPhone is just one part of a multi-pronged global strategy to turn AT&T into a “mobility” play. Apple’s innovative iPhone offering bundled with AT&T’s network moved both Apple and AT&T into new territory, bucking the mobile industry’s standard ways of introducing new handsets, according to the Wall Street Journal. Apple’s CEO Steve Jobs said it took just 74 days to sell one million iPhones (versus two years to sell one million iPods). AT&T recently launched a new advertising campaign (see video below) to underscore the company’s new, mobility-centric view of life, combining IPTV triple play (U-Verse) with their mobility (Cingular) assets. AT&T’s new tagline: Your Seamless World. According to Stephenson, the new advertising initiatives are designed to highlight how AT&T helps connect people to their worlds wherever they live and work. AT&T continues to take steps to innovate and become an experience provider. AT&T Advertising CampaignAnd one of the market’s boldest innovators, Google, has leveraged their search engine roots into offering a myriad of services and experiences. And now Google is focusing its vision on the wireless 700MHz spectrum--only time will tell where Google boldly takes its innovation next.

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