User Involvement during the Development of Mobile Service Applications

Introduction

The increasing trend towards Internet connectivity by consumers through a variety of mobile devices has altered the perceptions of consumers in terms of their access to information; applications and related services over their mobile handsets. The increasingly interconnected nature of new mobile services has impacted MNOs (mobile network operators) business structures, operations and their interaction with customers. The concept of a business model has evolved from the work on value provision which identifies the value-adding activities of a firm. Unlike the case of manufacturing industries and adding value to the process by the transformation of the physical materials through a sequence of manufacturing processes, many scholars suggested that in some industries (such as banking, insurance, advertising), Porter’s value chain (1980) cannot give a clear picture of the impact of the different ways firms and customers are connected to each other (Funk, 2009; Weiner et al., 1997).

Traditionally the mobile communications industry value chain was influenced by the evolution of digital communication systems, more specifically, the transition from analogue to GSM to CDMA communication system standards at a global level (Funk, 2009). At that time the value provision was limited to basic phone calls text messages and limited data bandwidth. The traditional business model of the phone industry value chain is based around the Mobile Operator’s service provision as shown in Figure 1 (Funk & Methe, 2001; King & West, 2002; Lehenkari & Miettinen, 2002; Lyytinen & Fomin, 2002; Steinbock, 2003). The subscriber not only sees the MNO as the provider of wireless connectivity (including internet access) but also their route for downloading applications. The billing mechanism is through the MNO for the entirety of the user’s mobile provision.

Figure 1.

Traditional business model for mobile services

The enhanced capabilities of mobile handsets are starting to include activities previously associated with traditional desktop computing capabilities. This extends the mobile handset from being used for connectivity to a range of purposes as shown in Figure 2. From the consumer’s perspective their contracted services is also part of the overall package as shown on the right of the figure. Consumers will assess their current package in light of their perceived requirements which is based on lifestyle and individual preferences. Further, consumers will be aware of the alternatives as for many demographics (such as youngsters) social image is partly portrayed through their chosen handset and services.

Figure 2.

Mobile applications and billing packages for consumers