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January 6, 2009

The mobile industry’s £1bn lesson: Collaborate or die

By Peter Kirwan MM blog

Those of you who aren’t temperamentally Russian might like to cast your eye over this story about how Vodafone and Orange are extending their alliance.

The mobile operators — which already share bits of their network — will shortly start collaborating on pretty much everything apart from marketing and sales.

As detailed by Richard Wachman at the Observer, the expanded Vodafone-Orange deal covers technology, engineering, maintenance, 3G networks, international coverage. . . in fact, just about anything and everything that customers don’t see.

What’s the relevance of a tedious alliance between Vodafone and Orange? Anyway, surely these two companies are mortal enemies?

That last bit is true, course. But it’s also true that the mobile industry is grappling with a tricky double whammy of recession and structural change (limited long-term opportunities for new growth).

Rather like the news business, in fact.

And here’s the rub. As Richard Wachman points out, collaborating with its deadly rival is expected to save Vodafone somewhere in the region of £1bn annually. This comes on the back of a similar network-sharing deal between T-Mobile and 3.

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The news business faces far tougher challenges than the mobile industry. And yet we’ve barely started to explore the potential for collaboration between traditional enemies.

Yes, it’s true that excess print capacity does get rented out. And the Independent will shortly move into offices owned by DMGT.

But as I’ve previously tried to suggest rather haltingly on these pages, there’s more to be done. A lot more.

For example: at the Guardian, Jemima Kiss made the basic point yesterday that “sites as destinations” have been losing ground to “open, sharing, platforms”. She alights upon the Open Social initiative — which involves Google, Yahoo and MySpace working collboratively -– as an example of the trend.

Kiss suggests that the results of such collaboration include “a more uniform experience for users”. Just as importantly, cross-site collaboration also begets more applications. That’s because it allows developers to write code once and run it everywhere. Kiss writes:

Can you imagine the Times, Telegraph and Guardian partnering on the technology for a shared content system? It seems absurd, but the equivalent is happening in technology. The principle should be explored. Big media needs some big ideas.

The question is far from absurd. In fact, it’s downright good. Why haven’t newspaper websites opened themselves up to third-party developers a la Facebook?

(And before you say anything in response, consider that Facebook opened itself up to third-party developers 18 months ago. Since then, it’s become blindingly obvious that this stuff works. . . )

Why aren’t those third-party developers being encouraged to write applications that encourage the consumption of content and advertising? Or applications that automate the business of ad trading?

Come to think of it, why haven’t newspaper CEOs thrown their best geeks into a room with an instruction to report back after sketching out a dozen plans for increasing the usefulness of news sites in a socially-networked world?

The only possible explanation is parochialism. In 2009, collaboration with our bitterest enemies needs to become part of our response to what ails us.

If this doesn’t happen, I really will start to get worried.

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