Subject: [NEXTEL-1] Jordan may see Head-on Competition between GPRS-based Push-to-talk services and iDEN

From: [email-masked]
Date: Thu, 02 Oct 2003 08:55:55 -0400

Jordan: Wednesday, October 01 - 2003 at 13:57
Jordan may see Head-on Competition between GPRS-based Push-to-talk services and
iDEN

An IDC Event Flash, released to IDC's MEA Telecommunications Continuous
Intelligence Service (CIS) clients, analyzes the likely market entry strategies of
the New Generation Telecom Company, an iDEN operator, and the GPRS-based
Push-to-talk services to be provided by the two incumbent GSM operators in Jordan,
Fastlink and MobileCom.

Fastlink and MobileCom have both announced plans to launch carrier-based
Push-to-Talk (PTT) services over GPRS in Jordan during early 2004. Simultaneously,
the Telecommunications Regulatory Commission has awarded a digital radio trunking
license to NewGen, part owned by Jordanian and Saudi investors. The company, which
is set to launch in 2004, will use iDEN PTT technology from Motorola to cater to
specific vertical business sectors in Jordan.

Thus by mid-2004 Jordan could see competition between NewGen, a new entrant in the
mobile voice market, and the two GSM incumbents. But the marketing strategy chosen
by each player is likely to determine whether the rivalry between these two
seemingly competing technologies, GPRS-based PTT and iDEN PTT, will result in a
head-on collision in the market, or whether they will steer clear of each other by
focusing on differing niche markets.

NewGen is studying the possible applications it could provide to several vertical
sectors, including tourism, trade, finance, insurance, real estate, construction,
manufacturing, and transportation, while also assessing its options with the
consumer market, including residential customers and students. According to NewGen
estimates, there are about 80 private trunk networks in Jordan, providing PTT
services to roughly 8,000 users.
Although all three operators have yet to announce their intended market entry
strategy, IDC believes that there are parallels between the carrier-based PTT
services being planned in Jordan, and the current rush to launch PTT services in
the United States by mobile operators wishing to compete with the US incumbent
iDEN operator, Nextel.
While it might be tempting for the GPRS-based PTT providers to seek to compete
with NewGen's iDEN service head-on by targeting the vertical sectors with a high
degree of PTT needs, such as the current 8,000 or so users of private trunking
networks, closer analysis of the needs of these vertical sectors, and the
underlying PTT technologies, indicates that positioning the GPRS-based PTT service
for these vertical sectors might not be the best market entry strategy for the GSM
operators.

As the US market has shown, attracting key vertical sectors is not only dependent
on the instant connectivity offered by PTT services, but also on the service
provider's ability to integrate its services into the core business processes of
its customer base. Very often, these processes are centered on mission-critical
field force applications and are vertical in nature. NewGen will have these
vertical sectors as its primary focus, and thus is likely to meet the specific
needs of these niche customers with its iDEN technology more than the larger
GPRS-based PTT providers can.

The usability of competing GPRS-based PTT services, including delay in session
initiation and latency in transmission, will play a key role in deciding their
success, especially when it comes to churning key vertical sectors. Because
GPRS-based PTT is still very new worldwide, these performance metrics will be a
moving bar as experience with the application and network migration serve to
improve the user experience.
While it is certainly worthwhile for the incumbent GSM operators to protect key
customers from churning to NewGen, IDC believes it is inevitable that many of the
vertical sectors most in need of PTT services will do so. IDC believes that
GPRS-based PTT providers should focus their efforts, at launch, on consumers and
general business subscribers. This will allow them to leverage their best selling
points, build experience and expertise with the application, and later attack
NewGen's core customers with the highest value proposition.

Current opportunities for GPRS-based PTT services exist specifically in
white-collar and "general business" organizations, such as IT departments, general
services, and maintenance personnel. These are roles in which the PTT
functionality may be mission critical for the employee or group, but it is not
necessarily mission critical or central to the processes of the company as a
whole. The primary roadblock in these circumstances will be performance and QoS,
specifically related to initiation delay and completion metrics.

On the consumer side, the best view of consumers' willingness to accept this new
mobile service is probably found in the recent history of SMS demand in Jordan,
which has shown one of the region's highest usage patterns. Much like SMS,
however, the lack of PTT interoperability between the two incumbents' networks
could be the Achilles heel of carrier-based mobile PTT services on the consumer
side.

IDC is the premier global market intelligence and advisory firm in the information
technology and telecommunications industries. We analyze and predict technology
trends so that our clients can make strategic, fact-based decisions on IT
purchases and business strategy. Over 700 IDC analysts in 50 countries provide
local expertise and insights on technology markets. Business executives and IT
managers have relied for 40 years on our advice to make decisions that contribute
to the success of their organizations.

IDC is a subsidiary of IDG, the world's leading technology media, research, and
events company.

http://www.ameinfo.com/news/Detailed/28863.html

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