THE ECONOMICS OF ALL-YOUCAN-
CONSUME BANDWIDTH: ARE
OPERATORS STILL MAKING MONEY?
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KEY FIGURES
SUBSCRIBERS
2.6 million
SERVICES OFFERED
Mobile internet access,
mobile portal services and
international roaming,
SMS, MMS
TELIASONERA OWNERSHIP
76.6%
REVENUE GROWTH
63% in 2010
EBITDA
Breakeven in Q4 2010
CASH FLOW
Positive by end of 2011
“[Yoigo] has experienced a 72
percent acceptance rate of
the mobile data up-sell option
since the launch...The cost of
implementing this project was
paid back within three weeks.”*
—Johan Andsjö CEO, Yoigo
YOIGO – A CHALLENGER IN THE SPANISH MOBILE MARKET
TeliaSonera’s Spanish mobile operator, Yoigo, is the fastest growing mobile network
operator in the region. Yoigo has seen exponential subscriber growth with its easy-to-use
mobile services. The service it offers is based on honesty, transparency, simplicity and the
streamlining of internal resources enabling it to pass on savings directly to its customers
and to offer lower prices. Yoigo’s strategy is to keep it simple—people should be able
to understand what they are paying for. It has a strong loyal base of postpaid as well as
prepaid subscribers.
”Yoigo has very ambitious growth plans, but in order to compete effectively we have to
ensure that we maximize the return on our infrastructure investment,” said Johan Andsjö,
Yoigo’s CEO. ”We needed a solution that could seamlessly integrate with our existing
network infrastructure, deliver the performance we need to keep our customers happy,
scale with our rapidly growing subscriber base and be up and running in a production
environment in a matter of weeks. Procera Networks delivered on all of this and even beat
our aggressive time plan for integration and installation.”
BUSINESS CHALLENGES
There is fierce competition in Spain with three mobile operators having monopolized the
Spanish mobile telecommunications industry by exorbitantly charging for their data plans.
Yoigo entered the market as the first low-cost operator in Spain. The goal was to attain the
country’s best coverage.
The following Yoigo solutions highlight the policy management and enforcement
capabilities of the PacketLogic solution by empowering smaller operators to compete with
larger competitors.
CHALLENGE: Subscribers with Multiple Devices
Data services usage has exploded with the advent of various mobile network uses like
Facebook, Twitter, online gaming and real time video streaming. A wide variety of affordable
internet-ready tablets and smartphones have stormed the market giving rise to more devices
in use by individual subscribers or family members tied to captive mobile data plan limits.
Typically a family of four on average has five to six mobile devices connected to the internet.
Each device has a quota allocated and it often happens that one device uses more than the
allocated bandwidth while the others consume less. The challenge that subscribers face today
is the inability of aggregating the bandwidth quotas allocated to each device in the same plan
associated with the MSISDN.
SOLUTION
A new service offering targeting mobile internet savvy subscribers has been created
on the PacketLogic platform enabling sharing of data across devices belonging to
the same account or plan. Thereby as part of a ”multidevice plan” different devices
can aggregate quota subscriptions and share data usage as if all devices were on
one plan. When multiple devices are active simultaneously, the volume limit applied
is the sum of the individual device’s data plans, even if the devices are connected
through different locations. A huge increase in this cost-effective and deviceagnostic
data traffic plan adoption is expected as more consumers jump onto the mobile
broadband bandwagon.
CHALLENGE: OTT Mobile VoIP Usage
Yoigo subscribers were using OTT mobile VoIP clients such as Skype or Viber for some of their
voice communications but these OTT services were impacting the profitability of their service
plans given Yoigo’s highly competitive pricing. Yoigo’s service plan contract was modified
to require that new subscribers acknowledge up front that Yoigo would block VoIP calls but
feedback from their subscribers indicated they were still looking for a solution. Yoigo wanted
to open up use of mobile VoIP to their subscribers but understood the challenges of accurately
identifying VoIP traffic in their network so that it could be made accessible and affordable
to their subscribers. Yoigo took this requirement to their partner Procera Networks to see if
there was a solution. Solving this and embracing OTT VoIP was the key to improving customer
satisfaction and lowering subscriber churn.
SOLUTION
Yoigo introduced VoIP Bono, a mobile VoIP add-on plan to their standard mobile data
offerings. This service embraced OTT VoIP services such as Skype, Viber, and other
VoIP clients from their phone or other device. Yoigo VoIP Bono customers get about
600 minutes of talk time with the 100 MB allowance devoted exclusively to VoIP
calls. At 6 euros per month, this translates to an average cost of 1 cent per minute
for mobile VoIP usage. VoIP Bono is powered by Procera’s PacketLogic products that
Yoigo has had deployed in their network since 2007.
“We needed a solution that
could seamlessly integrate
with our existing network
infrastructure, deliver the
performance we need to
keep our customers happy,
scale with our rapidly
growing subscriber base
and be up and running in a
production environment in a
matter of weeks.”
—Johan Andsjö CEO, Yoigo
CHALLENGE: Subscribers Reaching Data Plan Limits
Subscribers often maxed out their
data plan limits before the month’s
end, which resulted in traffic shaping
to lower bandwidth. Even though they
were willing to spend more money to
purchase additional data plan capacity,
it was restricted due to the inability
of the existing provisioning system to
offer the service. This resulted in loss of
incremental revenue.
SOLUTION
Yoigo launched a mobile data up-sell option, the Top Up, whereby the subscribers
could seamlessly recharge their mobile broadband data accounts using a Top Up
portal. A landing page is presented if the subscriber is surfing the web or an SMS is
sent when their data plan limit is reached.
Once the monthly volume limit is reached, they are given the option to continue
browsing at lower speeds with no incremental charge or purchase additional data.
This can be achieved with the user authorizing additional data volume using the Top
Up portal that provisions the PacketLogic platform’s policy settings with this volume
for the subscriber to use in real-time.
The Top Up offering is empowered by PacketLogic Real-Time Enforcement (PRE)
systems and the PacketLogic Subscriber Manager (PSM) deployed in the Yoigo
network. This platform implements a usage monitoring system, enforces policies in
real-time and integrates into the BSS/OSS systems.
CHALLENGE: Subscribers Incurring High Roaming Data Costs
Yoigo has 3G coverage across Spain, but in places where there is no 3G network, users switch
to national roaming using Movistar’s GSM and 2G networks. It was negatively impacting
service margins when subscribers were roaming since higher roaming data costs were
getting paid to partner service providers when this occurred.
SOLUTION
Traffic shaping was successfully introduced in the roaming areas where Yoigo
didn’t have 3G coverage. This resulted in lower costs associated with subscribers
roaming. The turnaround was very quick and return on investment was a couple
of months due to the quick implementation of the service provided by the
PacketLogic platform.
“Visionary mobile broadband
operators like Yoigo are
using powerful new business
models to make costeffective
wireless broadband
a ubiquitous reality.”
—James F. Brear
President & CEO, Procera
BENEFITS
The new Yoigo offerings that were introduced were immensely popular, generated new revenue
streams and increased customer acquisition and retention resulting in quick return on
investment. There has been a 50% year-on-year increase in subscriber base since the launch
of PacketLogic platform–supported services.
Yoigo has created a mobile app for smartphones powered by PacketLogic’s platform that
enables subscribers to get real-time consumption information and manage their accounts
proactively. This leads to better customer satisfaction and loyalty to Yoigo.
The PacketLogic solution provides real-time analytics and enhanced business intelligence
insights and reporting. It also drives the Policy and Charging Control (PCC) ecosystem by enforcing
advanced network and service policies. This empowers, service providers to improve
the subscriber’s quality of experience, better monetize their infrastructure investments,
contain costs, and create attractive services for their users by making qualified business
decisions based on granular user and traffic intelligence.
”Visionary mobile broadband operators like Yoigo are using powerful new business models
to make cost-effective wireless broadband a ubiquitous reality,” said James F. Brear, Procera’s
president and CEO. ”In order to make these models work, the operators need to make
intelligent business decisions, deploy new services and effectively manage and control their
network traffic. PacketLogic is designed to give these operators the performance and accurate
visibility they need to succeed.”
Results
Monetization of service offerings and drive new revenue streams
Increase in loyal subscriber base by 50% year-on-year
Operational cost savings and reduction in revenue outflows
Traffic shaping on roaming subscribers
Top Up portal for additional usage
Cost-effective shared data across devices in same plan
Mobile app for checking balance integrated with PSM
Powerful network and business analytics
Ease of integration and interface to BSS/OSS systems
Roaming usage notification for outbound roaming subscribers