Orange's approach to the new mobile ecosystem

Earlier this year, I pointed out how Orange and operators were pursuing their innovation efforts in the context of new entrants (Apple, Google,...) shaking up the mobile value chain.

The recent announcements made at the 10th Orange collection are another proof of Orange's dynamism.If you have no clue what lifeisbetteron.com, wormee.com, radiomee.comcityvox.com, or webcity.fr have in common, I strongly advise you to take a look at this document.

Another interesting announcement was made this morning at the LeWeb conference in Paris, where Orange officially announced the launch of its Application Shop (available in beta in the UK and France for several months). This shop will first be available to 1 million customers in these two countries before being roll-out to millions more customers throughout 2010. For now it gives acess to 5,000 applications.

Replicating Apple's success will not be an easy task and operators should not follow this route. They should on the contrary leverage their key assets to offer:

- simple and personalized access for consumers. Operators are taking an horizontal approach serving their customers whatever devices they have (by opposition to the vertically integrated stores of Nokia, LG, Samsung...). The key is to offer the few relevant apps that are really optimized for a given device and to promote their own services (customer care, core services...) as operators won't be able to compete on choice and on a large catalogue of apps. Via operator billing, they can offer clear benefits to consumers but also to developers. Also, based on their consumer knowledge, operators could provide a more personalized experience with tailored recommendations à la Amazon.

- cross platform access, global scale and reach, marketing tools for developers. That's why operators' developer programm are key. In this regard, operators are struggling to federate the community of web developers more likely to work with the likes of Google, Apple or Microsoft (with its OneApp initiative targeted at non smartphone users). However, Orange Partner did a good job so far. Operators can offer developers various APIs (location, customer data, messaging...) to help them offering more tailored and targeted apps. The real value would come here from a mashup of several APIs in a single application. 

Can operators really provide differentiation in an increasingly competitive app store market?

It is early to have a definitive take on this as a lot will depend on the execution and the quality of the user-experience.

I expect several stores (from operators and handset manufacturers) to fail, consolidation to take place and niche players to emerge. Also there are many different options that operators can follow. Like Orange, other global players such as Vodafone (with its 360 initiative and with the JIL platform with Verizon, Softbank and China Mobile) or Telefonica/02 can pursue an ambitious app store strategy and offer developers cross-platform scale and reach. Smaller players should probably follow other options.