Sprint's Adib on the demise of preloaded apps, the growth of HTML5 and more
On the Hot Seat with Sprint Nextel's Fared Adib
Sprint Nextel (NYSE:S) has always been known for being fairly progressive in the mobile content space. The operator along with MobiTV even won an Emmy Engineering Award in 2005 for its Sprint TV service. But today's mobile app environment is much different from the mobile content space of the past. Fared Adib, vice president of products at Sprint Nextel, recently talked with FierceMobileContent Editor in chief Sue Marek about the company's advances in mobile app discovery, its decision to sell some of its signature products such as Sprint ID to other operators and more.
FierceMobileContent: Sprint recently created a new organization called New Ventures and said that group will market white-label versions of Sprint ID and Sprint Zone applications. Isn't it going to be difficult to market Sprint's signature products to other operators as a white-label solution? Who is going to buy it?
Fared Adib: I disagree. Carriers always rely on partners to develop our networks and our products and services. Inherently a lot of the innovation happens ... and how we run our networks and our services is done with partners.
We've already done this ourselves. We've integrated these products and services. So there's no reason carriers can't work with other carriers when they have already invested in the products and the intellectual property and the experience. The carrier is a big entity that has credibility. And when you talk to other carriers you have a level of credibility because you are speaking more to their challenges, and you understand them at a level that only a carrier can.
I believe that it may be a new model to a lot of people, but I think the carriers are very open to working with partners to deliver a solution. Just because we are called Sprint doesn't necessarily mean we have less credibility than companies that are smaller than us.
I think New Ventures is about taking a lot of that good stuff that we have created internally and sharing it with others and making a revenue stream from it.
What makes it different than in the past is the U.S., right now, is leading in smartphone adoption and network innovation. Other carriers around the world are just now in the infancy of delivering Android and certain specs. Or they may be more mature in that process but are looking for value-added services such as Sprint ID.
FierceMobileContent: One of the intentions of Sprint ID was also discoverability. That's still a huge issue for developers. Are you looking at other ways to help developers get their apps discovered?
Adib: This is one of my favorite topics. I'm a former app developer and coming from that world I can tell you that the biggest benefit that we got with open ecosystems such as Android is that you got these robust app stores like [Google Play] with hundreds of thousands of applications. But what you typically find--no matter what the operating system--is that the top thousands of apps are the same across all platforms. People are downloading the same things and it's not accidental. It's often the people that were there first captured the market share and became the de facto leader in that category.
Many of the innovative companies--whether they are small or even not so small--don't have huge marketing budgets. The natural path for them was to come to a carrier and say "preload us on your phone." The other problem we had is that we had devices that we were preloading so much on that customers started rejecting it. They thought there was bloatware on their devices. And as operators what you are doing is basically picking the winners and the losers.
FierceMobileContent: And that's exactly what content companies didn't like about the walled garden.
Adib: Exactlly, we were essentially creating another walled garden in a new world with a new paradigm.
So we looked at this seriously and said preloading is not the answer. And we stopped preloading except for a few core customer care tools. We started backing out and letting consumers delete those preloads.
The second part of what we did is that we worked with a partner called WMC Global with their Place Your Ad program that lets developers bid to get ad placement within the Sprint Zone app and the Sprint Tab on Google Play. It's an auction system that lets you place an ad in our recommendation engine. We bid it out and give people an opportunity to be an equal partner.
We are continuing to invest in it. We think there's a great idea here because it allows the developer to get discovered without the friction of having to deal with the carrier.
The other piece is that we shouldn't have to dictate who the winners and losers are. We aren't replacing the marketplace or the other app stores; we are just complementary.
FierceMobileContent: AT&T was recently reported to be considering charging developers for some of the data used by app consumers. Would Sprint consider something like this also?
Adib: I don't think it's within our principles to do that. We believe in unlimited. We don't want consumers to have to worry about how much data an app is using. We also think you could stifle innovation if you have certain apps that people are being charged for and they become the winners and losers in that space. People want simplicity in the way they are billed. This could be much more complex.
There could be advantages--it generates revenue and off-sets costs such as data usage and such. But it sounds like a solution, but not the one we would prefer.
FierceMobileContent: A year ago at Mobile World Congress there were a lot of OEMs introducing tablets. This year, that wasn't the case. Why the change?
Adib: Last year I was asked about the tablet phenomenon by a reporter and I said I thought I had seen this trend before. We had a hundred or so tablets introduced in 2011 between the Consumer Electronics Show and Mobile World Congress. By the end of 2011, there were less than a dozen.
I think what we experienced was a phenomenon that was driven by a low barrier of entry and commoditization. There is still growth, but I think it will be more established players investing in tablets.
FierceMobileContent: Now there is this new category of devices that are not quite tablet but smartphones with larger screens. What do you think of those?
Adib: I think what you are seeing is some experimentation. Companies like Samsung that are so big, and they have a large R&D budget so they tend to experiment with screen technology. They typically have some of the best processor technology. That differentiates them.
The Galaxy Note, they feel like there is an empty space between a phone and a tablet, and they are trying to fill that.
I don't think one size fits all. There are different form factors for different needs. We also don't think you buy one. There are multi-use scenarios for most consumers.
FierceMobileContent: Do you think there are too many operating systems for mobile?
Adib: At the end of the day, most consumers don't care about operating systems. The biggest innovation that Android and iOS brought to the ecosystem is the application marketplace. I think that what we have really learned is the true operating systems are the applications. It's about choice. That's something people will continue to want.
We hear a lot about HTML5 that I believe holds promise. I also think the browser should be considered an innovation. It sits on every platform that exists. I think the mobile Internet will go through the same evolution of Web 1.0 and Web 2.0. I think the browser will be somewhat of a platform in itself, and app developers will be able to create lightweight apps and not invest a lot of time in learning the different operating systems or developing for different operating systems.
Everyone has their eye on HTML5.