CTIA 2013: Telenor Connexion touts advantages of connectivity focus

It seems mobile network operators are constantly being urged to play a bigger M2M role than that of connectivity provider, but Telenor Connexion claims its focus on connectivity is helping it stay ahead of the competition.

The operator this week announced a new deal to provide connectivity services in Europe and Asia for Geotab, a North American fleet telematics specialist now expanding its service internationally.

It seems mobile network operators are constantly being urged to play a bigger M2M role than that of connectivity provider, but Telenor Connexion claims its focus on connectivity is helping it stay ahead of the competition.

The operator this week announced a new deal to provide connectivity services in Europe and Asia for Geotab, a North American fleet telematics specialist now expanding its service internationally.

“One of the reasons Geotab chose us was because some of the other players had solutions in the European market that were competing with what they wanted to do,” says Gwenn Larsson, Telenor Connexion’s head of Americas.

Speaking with M2M Zone on the sidelines of this week’s CTIA Wireless Show in Las Vegas, Larsson says the operator is pursuing companies already established in the US and Canada but looking to take their business overseas.

That opportunity is one that has also attracted the interest of other European operators, including Deutsche Telekom, but Larsson sees a big difference between Telenor Connexion’s proposition and that of its German rival.

“Deutsche Telekom is pursuing companies that want to use the mobile network operator as a solution provider, whereas we’re going after companies that already have their own solution and just want connectivity,” she says.

Margins are seen to be notoriously thin in that area, but Larsson says Telenor Connexion is still building a profitable business by delivering additional value.

One way is through its embedded connectivity application framework (eCAF), which reduces traffic consumption compared to traditional M2M deployments and helps customers to reduce costs.

Nevertheless, a reduction in competition would clearly help to boost margins, and Larsson thinks some of the MVNOs challenging Telenor Connexion and other network operators may find the going tough in the months ahead.

“Even two years ago, AT&T and T-Mobile USA weren’t focusing on SMEs launching M2M services, and now they are,” she says. “It must be hard for MVNOs because they are putting in an extra layer of margin reduction by selling the services that network operators can offer directly.”

Besides catering to US companies moving into Europe and Asia, Telenor Connexion is also looking to serve those expanding into Latin America, although the operator faces a tough challenge in this area from Telefonica.

“We don’t yet have much business in Latin America but we’re counting on that growing in the next couple of years,” she says.