Are we seeing the end of the SIM card?

There has been quite a bit written in the telecoms press about various initiatives that will see the death of the SIM card as we know it. This is very significant for mobile marketing for a number of reasons, but primarily there could be a major shift in customers’ relationships with their operator. For mobile marketers it means the brand engagement in mobile could shift with it.

Firstly I’ll explain what the change in the technology and business model will be. Since the advent of GSM, the defining technology has been the SIM card. The rectangular card with the corner cut off. Technically it’s not a SIM card at all, but a UICC. SIM is the subscriber information (such as the mobile number) embedded in the card. We will stick with the SIM term as that is what we all understand. At the moment, the SIM comes from the mobile network operator, which has the mobile number and operator information hard coded within it. That’s been good news for the mobile opeartors as they have complete control over the access and billing for that phone. It means that handsets can be sold below cost as the operator has a guaranteed revenue. The operators call it a ‘subsidy’ but technically it’s really a loan, as consumer pay for the cost of the handset (and much more) through their monthly tariff.

However, the change is that the SIM will no longer be hard coded. In the future, the SIM information will be able to be remotely programmed by anyone prepared to provide a service. Apple are showing a particular interest in this for a few reasons. Perhaps the biggest one is that there will no longer be a SIM card in the iphone. Instead you will buy the handset from Apple and the whole thing will be activated via something like itunes. Thus they have cut out the operator from the whole sales model. Apple managed to do it with content, with the app store cutting operators out of the content business, so there’s every reason to suppose that it could happen with the SIM information as well. What this means from a brand perspective is that media ownership will be even further entrenched with the likes of Apple and Google.

By having a remotely programmable SIM, it allows many different things to be done. For starters subscribers are no longer tied to an operator and can jump around from one to the other. No need to get codes and new SIM cards. It also makes it easier to create other SIM embeded devices, such as smart metering. It also means that other information to be programmed into the SIM. One area that would obviously benefit from this is NFC, or Contactless Payments. Apple are beginning to show a keen interest in this area, whilst all the major credit card companies (not to mention the GSM Association) have already invested heavily. The idea is that there will be a standard protocol (not yet agreed!), so any phone with an NFC chip will work on any reader. The specific card company information can then be remotely programmed into the SIM. So, you won’t have to buy a Barclaycard phone, you just get your handset reprogrammed.

The GSM Association are also interested in remote SIM programming. Some observers have thought that a strange position as it makes the operators into providers of even dumber pipes than present. However, when you think of it in terms of NFC, then it makes sense. The operators want to be in on payments and this could be the way to do it.

Google Wave: rising from the ashes?

Following Google’s announcement that Google Wave would shut down at the end of this year, they have changed tack slightly and now announced Wave In a Box. They have open sourced some of the code and the intention is to get developers to include the Google Wave features via an API. The orignal Google Wave was deemed a failure, as in spite of wide promotion, few people took up the product. This, however, is simply an indication of Google’s general problem entering into social media.

The problem is this: Google are basically a search company NOT a social media company. They do search brilliantly: web search, map search, image search, paid search. Even YouTube is fundamentally a search engine for video. In fact, their own Google Video never took off and it was the acquisition of an existing successful site that saw YouTube become the second largest search engine.

On the other hand, their entry into social media has largely been a failure: Google Wave, Google Buzz (does anyone actually use it?). I think that Latitude was a good concept, but it was immediately met with privacy concerns and never took off. I blogged at the time that Latitude had potential if they opened up an API for it. They have finally done that, but not before new upstarts like Foursquare and Gowalla claimed the location social media space. And they had APIs from the word go.

So, it doesn’t take a genius to see that Google are successful when they stick to search and unsuccessful when they try social media. And Google are a very bright bunch of people, so I’m sure they also know that. So why do they persevere? From Google’s perspective, why not? Afterall they make gazillions of dollars from their advertising so they can happily put out applications and projects to see if any of them take off. Not only that but Google empolyees are developing side projects all the time, so if someone’s got a good idea, why shouldn’t they put it out there?

All credit to Google for sticking with social media, but in the end it will be simply a niche against what they really do well. Search.

iphone vs Android: this time it’s a war of words

Apple censors iphone dictionary
The Apple/Google relationship has been become increasingly sour recently. The latest manifestation of this seems to be the censorship of the word ‘Android’ in apps in the iphone appstore. According to a report in Mobile Crunch, one developer had a reference to their entry into the Android awards removed from their appstore review.

Apple has previously censored words on the grounds of profanity, but have been largely ridiculed for removing ‘boobs’, ‘booty’ and ‘piss’ from apps such as dictionaries. The censoring of other brands appears to be a new step for Apple.

Google buys Admob … problems for the mobile operators?

Google’s purchase of Admob for $750m seems to be a good thing for both parties and mobile advertising in general. Unless, of course, you are mobile operator.

Why is this a problem for the mobile operators?

The answer is simple … as operator revenues get squeezed, they have started to look at mobile advertising as a significant source of new revenue. In the UK, for example, Orange, O2 (O2 Media) and Vodafone (Vodafone Target) have all put resources into this sector. A case in point is Orange’s acquisition of ad network Blyk, this summer.

Google have not made significant in-roads in mobile advertising, but Admob have. If you are a business or brand, you will have a choice to go to your network operator or Google. Judging by Google’s success with online advertising, it looks like most people will not choose advertise with the operators.