Tele 'cross the Mersey – T360 Liverpool captures the zeitgeist

Timing is everything. Just as we gear up for Telemedia360 in Liverpool on 21 October – where the media and telemedia industries come together to look at how to monetise cross-platform content and services – a flurry of activity out there in ‘the real world’ has shown that the timing of this show couldn’t really be any better.

Today the Internet Advertising Bureau has announced that, in the UK at least, online advertising has out stripped spend on TV advertising for the first time in the first half of 2009. This marks a momentous shift in the old world order and chimes very nicely with the appearance at T360 of Jon Mew, IAB’s head of mobile, who will be talking delegates through how mobile fits into this model.

At the same time, the Audit Bureau of Circulations (ABC) in the US has also published a study that finds that its US members in the print and online media industries are all desperate to take their brands mobile in a bid to increase revenues, reach, eyeballs and advertising. Again T360 features a raft of publishers that have all turned to mobile in one way or another to boost what they do.

The Financial Times will be on hand to demonstrate how it has used downloadable apps to drive people to pay for subscriptions to its website – the FT being the only publisher to charge for online access from day one, and so they are quite rightly, in the pink – while Future Publishing and Piri will also be there, speaking about how Piri helped Future use mobile to target third party adverts at its readers through mobile.

Bauer Media – the leading UK lifestyle magazine publishers – will also be joining in the debates at T360, with digital director Paul Wright, joining a distinguished panel that also includes leading UK newspaper group Trinity Mirror to look at how the print media has embraced online and mobile channels to expand from being simply a newspaper to being a multimedia set of channels – better serving readers and advertisers alike.

The other interesting development in the past few weeks that again chimes with what T360 is looking to do is explore how micro-billing – in fact all kinds of non-operator billing – are really the key to making media services succeed in their goal of monetising these new channels. The launch this week of Coinz from Charge2 is a case in point.

Debuting at T360 next month, Coinz provides online & digital businesses trading within the new media sector with a viable and effective payment solution to charge the new generation of micro-consumers for content, services or products. Any Coinz spent within the digital arena are able to be redeemed or exchanged by the respective Merchants for monthly revenue out-payments.

A Coinz user is provided with an individual secure account that can be dynamically charged using a variety of standard and widely acceptable payment methods such as credit/debit card, bank transfer, mobile recharge or PRS mechanisms. The Account converts and stores the value of money into Coinz and provides the user with a simple, consistent, secure and anonymous user experience across a multitude of digital businesses.

News and media are being consumed differently today and publishers are struggling with a vast reduction in circulation figures and the conversion of their readers to an online, payment based alternative. With circulation & advertising revenue dramatically falling in the commercial sectors and an increased number of broadcasters offering online catch up TV, the demand for charging micro-payments is being heavily supported within the industry. The boom of “Tube” style websites has also contributed to the trend to micro-consume content and has been extremely detrimental to businesses trying to gain equivalent revenue through pay-as-you-go and subscription based services. Coinz aim is to facilitate the “Billing of the Un-billable” by bridging the revenue gap between the online Premium and Free market sectors, which to date have so far remained elusive or at best difficult to capture.

Similarly, other alternative billing tools are also coming to the fore in the telemedia world, circumventing the old skool PRS and PSMS routes and opting instead for innovative ways to use credit and debit cards, and even cash, through the online and mobile channels.

Core Telecom, for example, will be at T360 exploring the role of its unique per minute credit card billing tools, which offer the ease of PRS, but without having to use PRS. Txttrans will also be on hand to discuss how it uses text in innovative ways to deliver flexible and interesting billing solutions.

Of course, there is far more than just these zeitgeist-grabbing topics at T360 on 21 October, but I just wanted to illustrate just how topical what this event is looking to do actually is. There are some major issues out there within the media – not least how to make enough money to keep going. Telemedia offers the channels, the billing and the track record to help them deliver this. Make sure you are there.

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Time for banks to join MNOs as pipes and let the cool brands handle the customers

The not-too-distant future could see banks shutting their branches, losing their brand identities and becoming ‘dumb payment pipes’, handling transactions from a new breed of online and mobile-based service providers. Or they could carry on much as they do now.

These were the two conflicting views posited in the Sibos Labs Innotribe debate on the future of banking, which sought to navigate its way through the likely impacts on the retail banking sector of mobile, social networking and, well, mobile social networking.

All sounds very familiar doesn’t it: it’s the same debate that the telecoms industry is having about the role of MNOs in the ‘who owns the customer’ debate (not to mention the will MNOs become banks debate)… In fact, odd as it may seem, the world’s of retail banking, mobile and telemedia are surprisingly closely linked.

Banks will continue to handle the movement of value, but by not getting in early on developments in mobile and social banking, they will simply be payment processors for a new breed of service providers that offer the services. The same has happened to telcos: they wanted to own the customer, and have failed. In the future telcos will carry the traffic and banks the transactions – the customer will be interacting with other, cooler, brands.

But it goes deeper than that: most retail banks are now really ramping up their trials of contactless payments with mobile devices, the use of mobile devices as card readers and payment authorizers, mobile banking and the wifi/wimax-based, location-based possibilities of banking and much more.

Billing for online and mobile content and services is also slowly become the preserve of the banks and credit card companies too. Its an interesting time.

But what it shows is that the banks and the MNOs are destined to become pipes: one for money and one for the content. This is a massive shift in the world order and doesn’t come a moment too soon. It will allow those with the service ideas to dominate the customer facing element of business and lets, finally, the boring, generally poorly regarded massive corporate banking and telco brands disappear.

Its already happening. Google and Apple, while not dominant in numbers, are the dominant brands now in mobile and online. They will soon become the dominant customer facing brands in retail banking, telecoms and billing – but only as the customer sees it. They will get all the glory, but the old world gets all the cash!

But still the old world clings to the misconception that it still has a role to play. Here at dull banking conference Sibos in Hong Kong, the ‘old world’, represented at a panel ‘face-off’ by Richard Jaggard, Head of Sales Global Payments and Cash Management Asia Pacific, HSBC, and Mary Knox, Research Director, Banking and Investment Services, Gartner Industry Advisory Services, Gartner argued vociferously that all the web, mobile and social networking brings to banking are new channels to customers and that, basically, what banks do will never change.

Chris Skinner, Chairman of the Financial Services Club & CEO, Balatro, and Tim Collins, Senior Vice President, Experimental Marketing, Wells Fargo, on the other hand, tried to convince the audience that mobile, not only offers the consumer “a branch in their pocket”, but also that mobile web access and social networking, are the tools of the upcoming generation and, whatever banks think, it is how they will interact with their customers in the future.

“Banks continue to put their heads in the sand when it comes to mobile and social networking,” said Collins. “It tool 10 long years to get banks using the web and they will take the same slow approach to mobile. But their customers get it and are bemused that their banks aren’t getting it. As a result telcos, and Google and Nokia and others will fill the gap and the banks won’t be involved.”

Skinner cited the example of Kenya, where Vodafone is now the biggest bank in the country. “In developing countries, the vast majority of banking is done using mobile and they are way ahead. This is what the future will look like.”

Knox, however, pointed out that, while this was certainly true in developing markets, “it is only because they have no better alternative. In the US and Europe, bank branches are very strong and will stay strong as they work and its what people want to use to interact with banks,” she said.

But, this may well be true today, but tomorrow’s ‘digital native’ consumers – kids that have never known a world without the web or mobile – will be very different indeed and will want to use social networking, mobile and other services, through consumer brands they trust, rather than going in to a bank branch, said Skinner. And that this is why retail banks face an uncertain future.

Jaggard, in defence of the banks, countered with the argument that “banks do get it and we are not ignoring it. But we are being realistic about the challenges of doing it – and anyway banks will underpin the whole thing anyway”.

MNOs hedge their bets with own credit cards

Much has been written – at least here on telemedia360 – about how mobile billing is seeing a shift from the poor payouts of operator billing towards alternative, credit and debit card billing mechanics which offer better pay-outs and, thanks to the rich inventiveness of the telemedia billing industry, a raft of flexible services.

All this means that, despite operator billing still being the predominant payment mechanism, the writing is on the wall for MNO control of the space.

So what do the MNOs do? Well, to cover all bases they are launching credit cards of their own. In the UK O2 has rolled one out and now Telekom Austria’s mobile arm, mobilkom Austria, has done the same.

It has long been mooted that operators would enter the financial services world. For many years they were so cash rich, thanks to their pre-pay services, that they rivalled banks for capitalisation (until of course we found out that banks were grossly under capitalised and were recklessly gambling with what money they did have – but that’s another story).

MNOs also had a huge – and profitable – FX (foreign exchange) business. Thanks to high roaming rates and the growing move to cross border services, they made tidy profits on simply moving money around.

All this made them look, to all intents and purposes like banks. Fast forward five years and banking is a dirty word and the idea of MNOs moving from their core business to join the throng of bankers is largely pooh-poohed. Its non -core and banking is now a dirty word.

But, launching credit card does leverage MNOs banking like operations, opens up a new revenue stream and, perhaps most importantly, means that, as credit card billing eats into operator billing, the MNOs still get a slice of the action.

There is other good news for telcos in the banking space also. At the Sibos convention in Hong Kong this week, strategists from Forrester Research, Microsoft and London Business School all painted a picture of tomorrow’s retall banking sector that relied almost entirely on delivery through wireless channels – that’s networks, wifi, wimax etc – and that relied on contactless payments and wireless web.

I’ll spare you the real boring details, but suffice to say the vision of the future is that you will travel in an electric taxi – paying automatically and contactlessly as you get out – enter the mall, where there will be a ‘bank space’ that will automatically recognise you and start pumping data to your handset and screens around you. You will then interact through you rmobile bah blah la did ah.

It all looks wonderful. But its Microsoft, so it probably won’t work very well. It is also mobile, so will cost a bomb and/or not work very well. Anyhoo, its an interesting idea.