& cplSiteName &

Microsoft Gives Telefónica an Apps Edge

Ray Le Maistre
LR Mobile News Analysis
Ray Le Maistre, Editor-in-chief
3/28/2011
50%
50%

Telefónica SA (NYSE: TEF) has teamed up with Microsoft Corp. (Nasdaq: MSFT) to offer 6 million .NET applications developers what they believe is an easy and affordable route to the international operator's mobile customer base. (See Telefonica, Microsoft Team Up.)

The partnership, if successful, could create a de facto model for operator/developer relationships as all parties in the chain -- Telefónica, Microsoft, the developers and the mobile customers -- stand to gain in some way. And it's clear, from developers that attended a press conference in London this morning, that the model proposed by Telefónica and Microsoft is a significant improvement on previous efforts from the telecom sector.

Here's how it works. Telefónica's BlueVia unit provides .NET developers with a software development kit (SDK) optimized for use with Microsoft’s Visual Studio development environment and the software giant's Azure cloud services platform. That SDK includes application programming interfaces (APIs) to Telefónica's network resources (currently its messaging platforms). This allows developers to build applications that utilize the mobile giant's network capabilities, as Telefónica outlined in February when it unveiled its BlueVia initiative. (See Telefonica Shows Developers the Money .)

For its part, Microsoft provides .NET development support and, if an application is accepted by Telefónica, hosts the application on its Azure cloud services platform for a recurring entry-level fee that grows only if the applications becomes successful and requires more capacity and support. Microsoft also provides additional support for developers targeting Windows Mobile-based devices and other Microsoft platforms, such as the Xbox, though the applications can be developed for use on multiple mobile device platforms.

For the developers, life is made as simple and easy as possible, with the prospect of recurring revenues if an application becomes successful. There are no up-front costs to use the BlueVia SDK; Instead the two parties forge a revenue-sharing deal that results in the developer taking, for example, 10 percent of any messaging-related revenues generated by the use of the service.

So as a service becomes more popular, Telefónica and the developer both see their revenues grow. Microsoft also benefits from popular services, as while the cost to the developer for being hosted on Microsoft's Azure cloud services platform starts at a low entry point, it grows as an application becomes more popular and requires more capacity to meet demand.

The idea is to encourage developers to create new services that utilize Telefónica's network capabilities, rather than developing a one-time application that is paid for and downloaded once. By building an application that, for example, makes use of the operator's text messaging platform -- such as the secure, location-based taxi-booking service in London called Taxistop -- revenues for both the operator and developer grow each time the application is used.

To date, the perception of telcos by the developers has been "very negative," noted the head of BlueVia José Valles, because the developers have been treated as potential sources of revenue (through charges for use of SDKs). This model, he said, is different, as it treats developers as partners for new revenue growth.

Currently, applications developed through this partnership can be offered by Telefónica's mobile operations in Spain, the U.K., Mexico and Argentina, covering about 80 million mobile subscribers in total. By the end of the year, the BlueVia team, which built its SDK and exposes its network assets using a service delivery platform developed with Huawei, aims to have extended that to Telefónica's nine largest markets that serve more than 200 million mobile users.

Of course, any applications developed will be available only to Telefónica customers, therefore making it a limited market. And the benefits of this partnership are targeted specifically at .NET developers. Microsoft says it's prepared to host applications developed using other platforms such as Java, though this sounded more like lip service than an olive branch.

Why this matters
Despite its limitations, the basis of this partnership could prove groundbreaking in the ongoing development of relationships between mobile operators and application developers.

According to developers that have already made use of the BlueVia and Microsoft assets, Telefónica is leading the way in terms of providing an attractive environment for the applications community, because it's not demanding money up front for access to its network resource APIs. In addition, this model provides the potential for recurring revenues rather than one-time payments for application downloads.

For Telefónica it provides extended access to the developer community and the opportunity to cultivate a reputation as a company that's looking to work with and help developers rather than exploit them. And if the model works, it could lead to data service growth and customer "stickiness."

For Microsoft it's an opportunity to get even closer to Telefónica and to further develop its Azure platform in terms of use and revenues. It's also an opportunity to enhance its reputation among the telecom operator community. BlueVia's Valles told Light Reading that Microsoft's Communications Sector team had been "very easy to work with. It has changed. Microsoft has lost the arrogance it used to have."

And for the mobile market in general it may point the way toward a model that can help operators engage more quickly with developers following years of frustration.

For more
Operators have been trying to figure out how to broker a meaningful relationship with applications developers for some time.

— Ray Le Maistre, International Managing Editor, Light Reading

(1)  | 
Comment  | 
Print  | 
Newest First  |  Oldest First  |  Threaded View        ADD A COMMENT
digits
50%
50%
digits,
User Rank: Light Beer
12/5/2012 | 5:09:17 PM
re: Microsoft Gives Telefónica an Apps Edge


A comment worth remembering... even if it does only pertain to Microsoft's Communications Sector.

Light Reading’s Upskill U is a FREE, interactive, online educational resource that delivers must-have education on themes that relate to the overall business transformation taking place in the communications industry.
LIVE NOW!
Friday, December 2, 1:00PM EST
The SDN Approach to IP & Optical Integration
Sterling Perrin, Senior Analyst, Heavy Reading
UPCOMING COURSE SCHEDULE
Friday, December 2, 1:00PM EST
The SDN Approach to IP & Optical Integration
Sterling Perrin, Senior Analyst, Heavy Reading
in association with:
From The Founder
Light Reading today starts a new voyage as part of a larger Enterprise.
Flash Poll
Live Streaming Video
Charting the CSP's Future
Six different communications service providers join to debate their visions of the future CSP, following a landmark presentation from AT&T on its massive virtualization efforts and a look back on where the telecom industry has been and where it's going from two industry veterans.
Women in Comms Introduction Videos
Korn Ferry Consultant: How to Find, Cultivate & Be the Best Talent

11|30|16   |   4:10   |   (1) comment


Erin Callaghan, a managing consultant for Korn Ferry Futurestep, shares strategies for companies to improve how they recruit and for women to ensure they don't get lost in the pipeline.
LRTV Custom TV
We Can Make the World More Sustainable

11|29|16   |     |   (0) comments


GeSI is a global e-Sustainability Initiative organization bringing together 40 big multinational companies around the world. According to GeSI's report, information and communication technology can make the world more sustainable. Luis Neves, chairman of GeSI, shared with us his opinion at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
Finding a New Way to Engage Customers & Drive Revenue

11|29|16   |     |   (0) comments


Mobile revenues are declining. Digicel, a player in the Caribbean telecommunications/entertainment space, has found a new way to engage customers and drive revenue. John Quinn, CTO of Digicel, shared with us its story at Ultra-broadband Forum (UBBF2016)
LRTV Custom TV
Do You Really Need Gigabit Infrastructure?

11|29|16   |     |   (0) comments


Altibox is the biggest fiber-to-the-home (FTTH) player and the largest provider of video and TV in Norway. They started out with zero customers in 2002. Now they have close to half a million households and companies attached to their FTTH business. Nils Arne, CEO of Altibox shared with us their story and insight on 5G at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
BT’s Openreach Strategy & Its Updates in 2016

11|29|16   |     |   (0) comments


A lot of developments at Openreach this year in terms of strategy and planned investments. Peter Bell, CIO of Openreach BT, shared with us the updates of Openreach at Ultra-broadband Forum (UBBF2016).
LRTV Custom TV
ITU: The Broadband Is Our Future

11|29|16   |     |   (0) comments


At Ultra-broadband Forum, Houlin Zhao, Secretary General of ITU, discussed how important it is for countries, companies and everybody to be working together to help to build the broadband and digital economies (UBBF2016).
LRTV Custom TV
Tackling 5G in Dallas

11|28|16   |     |   (0) comments


Here are our highlights of the 5G North America show in Dallas, Texas with Light Reading's Dan Jones.
LRTV Interviews
Cox Prepping for Virtualization Trials

11|14|16   |     |   (0) comments


In this video interview, Cox's Jeff Finkelstein discusses MSO's plans to test managed business services in early 2017 and tackle Distributed Access Architectures.
LRTV Custom TV
Drivers & Potential of NGP

11|11|16   |     |   (0) comments


ETSI has created an Industry Specification Group to work on Next Generation Protocols (NGP ISG), looking at evolving communications and networking protocols to provide the scale, security, mobility and ease of deployment required for the connected society of the 21st century. The NGP ISG will identify the requirements for next generation protocols and network ...
LRTV Custom TV
Huawei IP 2020 for Future Networks

11|11|16   |     |   (0) comments


Future Networks should satisfy many requirements such as high throughput, extremely low latency, flexible mobility, intrinsic security, networking automation, and so forth. The Chief Architect of Huawei Future Networks addresses a holistic solution, i.e., IP 2020, to achieve these requirements for various future life scenarios (e.g., autonomous driving, tactile ...
LRTV Custom TV
Digital Object Architecture

11|11|16   |     |   (0) comments


Digital Object Architecture provides a basic information infrastructure that can facilitate interoperability between or among different systems, processes, and other information resources, including different identity management systems. Digital objects are networked objects that are named by digital object identifiers and instantiated by an infrastructure service ...
LRTV Custom TV
BT's Openreach Has High Hopes for Long-Reach VDSL

11|11|16   |   06:04   |   (0) comments


Peter Bell, Network Portfolio CIO at BT's access business Openreach, talks about the operator's trial of a new broadband access technology called Long Reach VDSL.
Upcoming Live Events
December 6-8, 2016, The Westin Excelsior, Rome
May 16-17, 2017, Austin Convention Center, Austin, TX
All Upcoming Live Events
Infographics
Hot Topics
AT&T Debuts DirecTV Now on New Video Platform
Mari Silbey, Senior Editor, Cable/Video, 11/28/2016
Apple Seeds 5G? Seeks 'Multi-Gigabit' Chip Designer
Dan Jones, Mobile Editor, 11/30/2016
Altice Plans FTTH for Entire US Footprint
Iain Morris, News Editor, 11/30/2016
Altice FTTH Bill Could Hit Almost $9.6B in US
Iain Morris, News Editor, 12/1/2016
Samsung Bows to Investors, Considers Revamp
Iain Morris, News Editor, 11/29/2016
Like Us on Facebook
Twitter Feed
BETWEEN THE CEOs - Executive Interviews
Eyal Waldman, CEO of Mellanox Technologies, speaks to Steve Saunders, CEO of Light Reading, for an exclusive interview about the 100 GB cable challenge, cybersecurity and much more.
Join us for an in-depth interview between Steve Saunders of Light Reading and Alexis Black Bjorlin of Intel as they discuss the release of the company's Silicon Photonics platform, its performance, long-term prospects, customer expectations and much more.
Live Digital Audio

Even when there's a strong pipeline of female talent in the comms industry, it tends to leak all the way to the top. McKinsey & Company says women experience pipeline leakage at three primary points: being unable to enter, being stuck in the middle or being locked out of the top. Each pipeline pain point presents its own challenges, but also opportunities to stop the leak. Wireless operator Sprint is making a conscious effort to improve its own pipeline from new recruits to the C-suite, and it wants the rest of the industry to do the same. In this Women in Comms radio show, WiC Board Member and Sprint Vice President of Enterprise Sales Nelly Pitocco will give us her take on the industry's pipeline challenges. Pitocco, who joined Sprint in May and has spent 20 years in the comms industry, will also offer solutions, share how Sprint is tackling the challenge within its own organization and take your questions live on air.