By Ingrid Lunden
Telefonica (NYSE:TEF) has been working hard to make sure it remains a relevant force in mobile as big companies like Apple (NASDAQ:AAPL) and smaller app developers like Twilio all swoop in to eat the carriers' proverbial lunch - offering mobile services to consumers and "owning" that customer relationship: that's seen the company make strategic investments in mobile payments operations like Boku, establish accelerator programs and generally look to remain on the cutting edge of whatever the mobile world will bring us next. The latest in that trend is the launch of a new app from Telefonica, TU Me, which will see the carrier taking a big step away from its traditional paid business model to offer users texts, voice calls, messages, and location and photo sharing - all free of charge (excepting WiFi or data plan usage, of course).
With the app available worldwide from today in Apple's App Store, the idea is to get as many people as possible using it, and then monetize it along the lines of how Skype has done - through the rollout of eventual value-added services. That could mean enhanced communications, but Telefonica tells me that it will likely also mean adding mobile advertising and other ways of generating revenue.
Telefonica says that it has plans to introduce further direct-to-consumer services under the TU brand "over the coming months." It's fairly vague right now on what those can be, describing them only as "enhanced communications services which its O2, movistar and Vivo businesses will make available to customers as part of their bundles." One thing that seems to point to is that while TU Me is free, these future services will either be paid offerings - or services that are offered as perqs for paying subscribers only.
The TU Me app works similar to Whatsapp - and of course Skype - in that it works irrespective of what carrier you use, with the different interactions flowing in a timeline. Unlike those apps, for now it will only work on iOS devices, although given that Telefonica has the most brand recognition in regions like Latin America and Europe, there is all likelihood that we will also see versions of this developed for BlackBerry and Android devices, both of which are popular in both regions.
Given that it also incorporates location-sharing, this also opens the possibility for Telefonica to work in services like offers and location-based advertising. These are already areas where the company has developed services - specifically in its O2 business in the UK - and since the company announced a new digital division, Telefonica Digital, it has had a mandate to roll more of these services out globally.
Similarly, you can also see the company's strategic investment in BOKU coming into play more in a global service like TU.
Another area where Telefonica may choose to offer charges in future is for storage: the app's data is all cloud-based and presumably there will be a limit to how much data you can store there, and for how long, for free.
Telefonica is not the first carrier to look at ways of offering services beyond its own subscriber footprint. T-Mobile last year launched Bobsled, a Facebook app that let any U.S. user make free phone calls to their Facebook friends. That proved to be controversial when Facebook (NASDAQ:FB) decided it looked too much like a service it was offering itself - now Bobsled is browser-based, outside the social network.
However, just as T-Mobile's Bobsled never really took off, there will still be a big challenge ahead for Telefonica to get critical mass around TU Me - critical mass being the basis of the service's business model, for now. Still, it's always great to see an old dog try a new trick - and there's every chance that this could be the one to stick.