What’s the WAC? The dumb pipes awakening!

WAC for Wholesale Application Community, the last minute initiative from the GSMA at MWC, is trying to keep the operators in the application race, i.e. the service race as more and more service are delivered through application (see previous posts). It is a matter of survival for operators if they want a piece of the service pie in the future.

At MWC sessions, Operators were complaining about the device OS fragmentation, forgetting that they are at the ones who manage this fragmentation inside their device portfolio to avoid to be dependent from a manufacturer. But with the tremendous success of Apple and RIM, the strong service ambitions of Nokia they all feel threatened of being transformed into dumb pipe business in the mid term and … they are right. Vodafone’s CEO cleared stated it’s worries with Google advertisement monopoly. The fear is a great self motivator for change for operator behemoth.

The Wholesale Application Community initiative shows the right way: developers will never develop an application for a specific network operator using its proprietary APIs. Operators’ APIs need to be standardized and open like the SMS premium gateways operator have managed to launch few years ago.  The Canadian OneAPI is clearly the programme to watch even if it’s late as the GSMA guys have been not very reactive.

Nevertheless one technology may blow away the dark clouds over the operators, it’s HTML5. HTML5 enables flash like website without … flash. Developers will be able to produce website with animation, drag-and-drop and media playback, etc. without the help of any plug-in in the browser. HTML5 will make applications platform independent and contribute to the de-fragmentation of the application market.
That’s for the promises, but each technology has a flip side or at least some limitations, and HTML5 ones are still to be discovered.

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2 thoughts on “What’s the WAC? The dumb pipes awakening!

  1. What do you think is the business model for carriers to engage in WAC?

    -> Direct revenue from app sales: Hard to imagine that it’ll be much of deal especially since WAC apps are widgets. Widget apps are extremely easy to copy (they come in plain source code), so successful apps will seek immediate plagiarism and thus app sales prices will be very low overall.

    -> Indirect business model, e.g. less churn: Don’t believe in that either as the purpose of WAC is to avoid carrier specifics, read there is no room for differentiation.

    So, what’s the business case for operators?

    • Thanks for your comment.

      I believe the business model is a direct one (i.e. direct revenue streams). Operators will sell to application developers access to network capabilities and information. e.g. Location. An application may need to know the location of the mobile with a very good response time that GPS cannot provide. The application polls the network to know the location from the cell ID. Then the operators invoices the application provider €0.00..01. These APIs will enable application providers to build services.

      One other issue today with the stores is application developers cannot invoice recurring service (it’s always a one-off payment). So with Payment APIs, operators intends to give access to their billing system. The operator invoices application service every month. The application developer gets revenue through the operator. And the operator keeps let’s say 30% of the revenue which seems to be the magical number these days.

      It will work only if all operators share the same APIs. Developers won’t develop for a specific operator. So APIs won’t have any positive impact on the opertor vs. operator competitive landscape (differentiation, churn, etc.) but it will keep operators in the application game against the Apple, Nokia, Google, etc. And this is the biggest threat to mobile operator business these days.

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