Depending on who you ask it is either the most awesome freebie in a broadband plan or it is the most controversial subversion of the Internet Economy possible. As in many cases in life, the truth is somewhere in the middle. There are many use cases where zero rating is a huge benefit to consumers – I for one would argue that T-Mobile’s approach with BingeOn is a great example of value for customers due to their support for a large number of video streaming services. The European Union’s Network Neutrality framework (discussed here) appears to be very concerned that zero rating will be used to inhibit the growth of the innovation economy by artificially limiting your application or content choices by incenting subscribers to choose the applications that are zero rated. Many US companies have urged the FCC to watch zero rating closely, and the FCC has said they will investigate on a case-by-case basis.
When you roam internationally, what are some of the main services that you want access to without paying a huge ransom in data roaming fees? Most subscriber’s answers would likely include email, messaging apps, and maybe map/navigation apps – keeping in touch with people using the same tools no matter where you are.
One of our customers, Yota, recently published a blog (here is a Google Translate link) describing a service that delivers exactly this offering to their international roaming subscribers, and I would like to explain how they designed it and how it works - and how it is good for their subscribers.
First, they used the Procera solution to determine what messaging applications were the most popular in their network. PacketLogic told them that their customers preferences were to use WhatsApp (45%), Viber (28%), Telegram (8%), and Facebook Messenger (4%) (They also added iMessage to this list for the official service launch). This is THE key aspect of offering a service like this – know what your customers want and deliver it to add perceived value to your broadband service.
Next, they conducted rigorous testing on the signatures that Procera had for the applications and had us make several changes to enable them to distinguish reliably between messaging, voice, and video. In general, we treat applications that our customers have selected for zero rating with a special level of signature creation rigor (anything to do with charging requires a lot more attention!). As they mention in the blog, some applications are updated almost weekly, so we have to keep on top of them (by coincidence, Procera updates our signatures weekly, allowing us to maintain pace with the rapid evolution of applications on the Internet).
They then launched the service offering to their subscribers, and from their perspective, it has been a huge success. They report that the number of roaming users that use mobile internet has increased by 5x – a huge benefit to both the operator and the subscriber. From a consumer point of view, this is exactly the kind of service offering that adds value to a service plan, as you can maintain connectivity while traveling is maintained using the tools that many mobile users prefer. Once you have started roaming, data traffic for the most popular messaging applications on their network is free – even when you run out of overall data allowance.
I expect to see more services like this that pick an entire class of applications (again, like what T-Mobile has done with their offerings) and serve them up as a zero rated offering. There is a huge consumer benefit for this type of offering, and operators that can use analytics to determine the application types that are the most highly valued by their subscriber AND their network can handle will come out winners in the highly competitive broadband market.