Operators engaged in ‘cashless’ relationships with big social brands should take heart: change is afoot. Those who can form relationships with these new innovators, such as the much-hyped ‘Ello’, stand to benefit
Ello is a new social network that has been attracting considerable attention in recent weeks.
The network, which positions itself as the “anti-Facebook”, offers users two unique selling points: firstly, it promises not to respect the privacy of its subscribers and secondly, it aims to keep the site an entirely ad-free zone.
The site is stripped back, and its founders anticipate that they will ultimately fund the project by offering users additional functionality. “When a network is very simple, people want specific features, and they’re willing to pay for those features,” Ello’s creator, Paul Budnitz, told Business Insider.
The network is currently in Beta testing and is invite-only but, according to some reports, is already getting 31,000 sign up requests an hour – highlighting just how willing users are to break away from the established social players, Facebook, Twitter et al.
Last week AsiaInfo hosted a media event to promote our latest research project, the results of which demonstrated that operators in Western Europe are missing out on €2.2 billion in OTT profits. Our argument, backed up by independent research, was that operators should look again at their OTT Partnership model: moving away from a handful of partnerships with very large OTT players towards multiple partnerships with smaller players.
The business case: Micro revenues X 100s of players = Compelling business case
While journalists could see the merit of the argument for multiple partnerships with smaller ISPs, such as retailers, not all were convinced that there would be many opportunities to partner with new social players. When the incumbents are so dominant, and with Facebook in particular entirely ubiquitous, who was emerging as a credible threat, they asked? Who could operators realistically partner with, if they were looking for a social media partner that offered differentiation and would talk seriously about revenue share?
Ello may not be perfect, and it may not be a challenger in the long term to the behemoth that is Facebook. But it reminds us that there will always be demand for the new and different. Facebook may have captured the market but the signs are there that users want to try something else.
So operators currently tied into deals with Facebook – who apparently “pays with brand” (rather than the preferable – cash!) should take note.