If the US market is fixed price(data) .. why does it not take off?

At forumoxford, I posted a very simple thought which has generated some great conversation.

The question was:

Just wondering ..

If the US market is fixed price(data) .. why does it not take off?

They have had fixed price data apps for some time .. so why dont we see more US data apps?


There are many insights to this question. Michael Mace posted on his blog - which he cross posted on forum oxford the points below. Not all of them are immediately practical (for example some form of application signing/security certificates is needed and releasing the user’s private data has much more serious implications on a mobile device – nevertheless, its a great list!

In addition to offering flat-rate data, here are the other steps a mobile operator must take in order to make that mobile data ecosystem work:

1. Provide a consistent architecture that works offline. Web applications depend on having a constant connection between the user’s computer and the Internet. That’s not practical for the mobile Web. Even in countries with heavy 2G coverage, there are lots of gaps in the 3G network, and will be for years. Mobile Web apps need to work like RIM’s e-mail client, which stores both the program itself and the user’s data locally and then sends the data to the network when a connection is available.

That means just bundling a browser is not enough. The phones will also need a software architecture installed on-device that can manage applications and data when the user is offline.

2. Kill security certificates. The line between websites and applications is blurring, as Web 2.0 architectures allow much more processing to be done on the client device rather than a server someplace in Mongolia. For example, Skype is mostly an application, not a web site. In the future it will be impossible for a user to tell exactly where an application ends and the Internet begins.

But today the operators treat websites and applications completely differently. The new flat-rate data plans let you browse just about any website you want. But just as we open up the browser, operators are starting to restrcit applications by insisting that they obtain a security certificate before they can be installed. The certification process is slow, inconvenient, and unreasonably expensive for small software companies and those that create a lot of applications.

Can you picture a website paying for certification before it can run on your browser? How many sites would bother? If the operators insist on certificates, they will make the mobile Web a small and uninteresting subset of the real Web, permanently. Certificates have to go.

3. Unlock the user’s data. Many operators (especially in the US) make it very difficult for an application to access the user’s data stored on the device, such as the address book, the dialer, and the user’s current location. But many of the most interesting new mobile applications need to be able to work with this information. The operators are afraid to give access to this data, but they’ll need to adopt the same security model used on the Web — let the user do what they want, and defend the device via security software. It’s ugly, but it worked in the fixed line world.

4. Make it easy to discover new content and services. The mobile data ecosystem will evolve faster if it’s easy for users to find new services and applications. Today the content discovery tools and software stores on mobile devices, if they are installed at all, are often buried under several layers of icons, or are very hard to use. We need the mobile equivalent of an Amazon.com — an online content store that’s easy to find, browse and search, and that makes suggestions to you based on what you’ve used in the past.

And oh by the way, that store needs to offer everything, not just the operator’s ten favorite apps. Do you think Amazon would have succeeded if it had offered only the books that Jeff Bezos thought were cool?

5. Get ready to go to a flat rate for everything. The logical outcome of putting the open web on a mobile device is that voice and data merge under a single flat fee. If a Skype call is free, then eventually all calls need to be free, or the users will just switch everything to Skype. Same thing for SMS messages once they’re directly in conflict with instant messaging. The operators’ old financial model won’t evaporate overnight, but I believe it’s now officially dying. I think the race is now on for full flat-rate mobile pricing. The operator that moves to the new model fastest stands to gain the most customers.