France Telecom in the UK, under the brand name Orange, is starting the transition of separating consumer services from the access business. Orange UK customers of the “Orange Home & Mobile Broadband” service will, aside from getting dual play services at home, also get a USB dongle for the PC, with a monthly downstream traffic allowance of 3GB per month to ensure Internet access at home and while mobile on the PC. It does not include Internet traffic for their cellular subscribers which would have been ideal for a more complete service transformation, however this is likely due to the much broader organisational issues this would have caused for France Telecom. The 3G dongle for the PC is just a small step, but it is a step in the right direction of viewing services more independently of the access technology.
Orange UK's service offering is a welcoming refresh to an otherwise static market approach by operators to the services market. Operators typically sell a set of services on top of a specific access network (fixed or cellular). This is, however, a network centric and not a customer centric way of selling services. Operators need to understand that services need to follow the customers, not the network. This is crucial for those operators that target a wider services market, such as video entertainment. Premonvision recently published a report to clients on this business transformation issue. Many operators organise their business around the main access network types, however this structure inhibits their ability to execute in the consumer services market. The video entertainment markets are moving away from what specific networks can provide of content and services, and towards what can be provided to the actual consumer. This is what new media companies, such as Youtube and Netflix, have understood, and are therefore striking deals to enable their services on as many relevant terminal devices as possible. They want their services to follow the customer, not the other way around. Operators in the services markets need to accommodate this change in the market and look at how to build up a service platform that is independent of the access networks. This will not be easy and will be a massive business transformation for many those companies that own and operator access networks and sell these services directly to consumers.
