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A war has been brewing in the technology industry for some time now, with the Big Four contenders – Amazon, Apple, Facebook and Google – starting to encroach on each other’s territory.  According to a recent article from Farhad Manjoo at FastCompany.com, over the next two years, Amazon, Apple, Facebook and Google will increasingly collide in the markets for mobile devices, tablets, apps, content and social networking.  Each company has its own unique weapons in its armory, and whilst they did not compete directly in the past, we are now seeing more and more examples of them making strategic moves into the others’ space – Google with its Motorola acquisition and the launch of Google +, Amazon’s Kindle tablet, Facebook’s developments in Media, Advertising and Communications, and Apple’s Cloud Services and Social Networking features within iTunes.

As these four giants continue to increase their dominance of the technology industry, what does this mean for the network operators?Operators are not direct contenders in this war, but they are in a unique position, not only providing the connectivity that allows the Big Four to deliver and monetize their digital services, but also being the custodian of a wealth of information about customers as well as having direct billing relationships with, collectively, close to 6 billion consumers globally.The Big Four will continue to generate huge amounts of revenues from “over the top” services, and no doubt they would like nothing more than for the operators to get out of the way and be relegated to the role of “dumb bit-pipe provider”. However, if operators make the right moves, they can effectively become the arms dealer in the innovation war, leveraging their unique assets to allow the Big Four players to compete with richer, more relevant services, improve customer choice and convenience and, perhaps most importantly, provide new low-friction ways to monetize their services.

A good example is in the area of video services. Because they own the network and the customer billing relationship, operators have the opportunity to influence not only the quality of experience associated with video content, but how the delivery of the content is paid for, and by whom.  This provides greater choice and flexibility across the entire value chain, from the consumer through to the content owner. For example, a consumer may choose to pay a premium for high-definition streamed video to the content provider (i.e. one of the Big Four), who in turn shares a proportion of that premium with the operator in return for providing a higher quality of service. With platforms such as Aepona’s, this process can happen on-the-fly using APIs (as opposed to requiring manual pre-provisioning), with the revenue management and settlement processes also being automated.

Another significant weapon the operators can provide is contextual relevance. Whilst the Big Four have amassed huge amounts of data about their customers, operators can augment that with real-time customer information such as location, presence, the type of device and connection a customer is using, whether they are roaming, details of their data plan, whether they are moving or stationery, and so on. Combining historical customer data (such as the type of products they like) with real-time information (such as whether they are within a 2 km radius of a particular retail outlet) will allow service providers to offer customers contextually-relevant services, delivering significant benefits to consumers and merchants alike.

There are many other examples of how operators can take advantage of the increasing competition between the Big Four, particularly in the area of Business to Business services and billing, and we will be discussing some of these areas in future postings.

It is inevitable that Amazon, Apple, Facebook and Google are going to dominate the technology landscape for the foreseeable future, and whilst this means that the Big Four will generate significant revenues from digital services delivered on top of the operators’ networks, it does not mean that the operators will have lost relevance – provided that they re-evaluate their role and make the right investments, both in people and in platforms, that allow them to become the arms merchant in the tech war.