FOCUS ON CRM
Over the last few weeks we have seen some very encouraging signs regarding the development of broadband in Australia (Optus) and in Singapore (SingTel and StarHub/SCV). So, while visiting CommunicAsia in Singapore last week, I spoke to both SingTel and StarHub to get a complete update. Full marks to both companies, but especially to SingTel, for providing me with answers to all my questions. They bent over backwards to help me.
Speaking in both Hong Kong and Singapore on Customer Relations Management (CRM), I proposed that CRM (of which the concept constitutes 85% and the actually technology makes up the rest) could propel Asian companies and Asian people into a leading role in this development. During this trip I was involved with the major company in the field, Siebel, and I learned quite a lot about CRM and some of the great new applications that are becoming available (such as eAdviser – but more on that next month).
IBM calls itself the largest user of CRM and it is very impressive to see what IBM has been able to do with it within a small period of time. For those people who consider CRM to be a load of hype, I would say ‘think again’. I am convinced it is the lifeblood of an organisation. The many failures in the implementation of CRM is a fair indication that those who concentrate their efforts on the 15% of CRM that represents the technology, still don’t have a good understanding of what is really involved in customer services. Technology is important, certainly, but it should be attended to only after the company has fully embraced the concept of customer services. These are still dirty words in the telco industry – lots of lip service, but I can’t bring to mind any telco in the world that has a good customer service (in terms of customer expectations). I refer to my earlier analysis – see Report www.budde.com.au: Global – Industry – Strategies – High-level Strategic Thinking
Before going on, I must once more express my absolute disappointment at the lack of Australian participation at CommunicAsia. NDC was the only visible Australian company and they did a great job. They told me that they have further strengthened a number of good relationships in Asia. I am sure there were a few other Australian companies present, but I didn’t see them. I didn’t see Telstra, PCCW or any of their new ventures such as Reach and WirelessCo. One comment was ‘Australia should try to be part of Asia and blend in rather than wave an Australia flag (hmm) don’t know.
New Zealand was very well represented, with a range of companies, and so were many other countries such as Spain, Germany, USA, Korea, Thailand, India, Taiwan, to name just a few. Paul Budde Communication was represented by one of our report resellers, GII from Japan. We successfully launched our five Reports on the Asia telecommunications and information highway markets (see page 100 and backsheet for more information).
THREE MAJOR BROADBAND DEVELOPMENTS
But back to SingTel and StarHub .
A few weeks ago telco StarHub and cable TV operator Singapore Cable Vision (SCV) launched their plans to merge their activities and upgrade their networks and services to a fully-fledged broadband network. SCV already has close to 300,000 cable modems in use. The merged entity will upgrade the analogue network to a digital one – it hopes to complete this over the next few years.
Hot on their heels was the announcement from SingTel. Some 300 residents in Singapore will be involved in an interactive multi-media services trial when this company rolls out its Interactive Television (iTV) later on this year. SingTel will use its broadband ADSL (Asymmetric Digital Subscriber Line) infrastructure.
The company has already signed up various content partners, such as Columbia-Tristar, Sesameworkshop, Intertainer Asia and MediaCorp, to provide movies, sports, drama, travel, and news content. However, it doesn’t have a broadcasting licence so it will be interesting to see how the regulatory issues are resolved.
The initial service offerings available during the trial period are video on-demand, scheduled program channels, electronic program guide, Internet access, e-mail, TV commerce/home shopping and information services. Additional services such as enhanced TV, interactive gaming and interactive advertising will be made available at a later stage in the trial.
Within the same few days, Optus announced that technical testing of its two-way interactive digital television platform on their broadband network was progressing well, with technical suppliers and more than 35 content partners. Trial participants are receiving a wide range of features via their existing televisions including TV Net, TV Mail, Optus Television content and a fully interactive electronic program guide. Pace Micro Technology have supplied high-speed DOCSIS-compliant digital cable set-top boxes and Liberate Technologies have supplied the middleware for the trial.
ANALYSIS OF ITV
Interactive TV has so far been spectacularly unsuccessful all around the world. It has been available in various formats since the late 1970s (first trials were in Columbus, Ohio, Osaka, Japan and Berlin, Germany). But, notwithstanding the availability of the technology, the business models to make such a service profitable have so far proved elusive.
The other problem in the iTV industry is that as yet there are no international standards. However, the Open TV platform that will be used by SingTel has a good chance of becoming a global standard. Furthermore, they have a good migration path to other developments such as Multimedia Home Platform (MHP) (also see article on page 97), the next generation of interactive TV based on Java technology (see web report on www.budde.com.au: Global – Broadcasting – Digital Terrestrial TV). MHP has already been selected by the Singaporean Broadcasting Authority as the official iTV standard for the country.
My analysis of iTV is that it will only be successful if included in a total broadband package. On its own we know that iTV is not all that attractive to customers – they don’t want to pay lots of money for the feature. However, if it were to be embedded in e-entertainment, VOD, and other ‘Internet-a-like’ applications, iTV could become a very important ingredient. Those companies that are capable of harnessing the various technologies (including videostreaming and datacasting), enabling them to base their offerings on what customers want, rather than on what they would like to push, are going to be the winners in this new field (see my remarks on customer services above).
Unfortunately, however, both SingTel and Optus are delivering the same old iTV examples: watching a sports match on television, fans will also be able to check the players’ profiles, visit the Internet website of the teams, purchase online team merchandise, and order the same boring old a pizza or meal, using just a remote control (yawn).
But, having said this, the main point is that broadband is now well and truly back on the agenda. SCV and Optus have both been leaders in this field since the mid-1990s, but both failed to capitalise on their early start. For a while it was thought that SingTel was not really interested in broadband. The company is in the process of buying Optus and they did give consideration to selling off that company’s broadband operations. However, it now looks as though significant strategic progress has been made within these organisations. I am sure that the rest will fall into place as long as they stick to their long-term strategy. We still have a lot to learn about broadband and it is great to know that SingTel, StarHub/SCV and Optus are taking these major initiatives.
More from CommunicAsia (3G, SMS and telco developments in China) in next month’s Telecommunications Newsletter.
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