Wireless providers urged to be picky with customers

Alana Roberts

Friday, Oct. 24, 2003 | 11:09 a.m.

Guess what, business leaders: not every customer is one you want to keep.

Such sentiments would seem to go against good business practices, but that is not the case, says Reed Hundt, former chairman of the Federal Communications Commission and current senior advisor at McKinsey & Co., a management consulting firm. He spoke during Thursday's keynote session at the Cellular Telecommunications & Internet Association convention in Las Vegas.

The session addressed how wireless firms can remain viable in a market saturated with customers.

CTIA represents all elements of wireless communication -- cellular, personal communication services, enhanced specialized mobile radio, and mobile satellite services. Member companies include Microsoft Corp., Intel Corp. and Nokia.

"In the starkest terms, there are customers that you should tell to go away. You shouldn't say it like that but you shouldn't do all that they ask for," Hundt said.

Juha Christensen, corporate vice president of the Mobile Devices Marketing Group at Microsoft and Sean Maloney, an executive vice president and general manager of Intel Communications Group at Intel, joined Hundt in one-on-one and group conversations with Tom Wheeler, president and chief executive officer of CTIA during Thursday's keynote session.

Hundt said given the huge lack of customer loyalty in the wireless industry, where customers often jump from provider to provider, wireless companies need to look at who their most valuable customers are and work hardest at pleasing them and not every customer that they have.

"A typical value destroying customer is my mother-in-law," Hundt quipped. "There isn't a day she doesn't phone somebody and ask what services you can give (her). She should not get the total amount of attention she desires."

Hundt wasn't the only one with a joke to sum up a useful business.

"A good friend of mine said there's a thesis of perversion," said Christensen. He said that "thesis" states that the best indicator of the success of a particular piece of technology is when people start using it for perverse or at least unintended reasons.

Christensen said the best way to go about acquiring and keeping loyal customers is to make sure technology meets the needs of both private and business users.

"We need to pump energy into the future market. We need to find ways to get core customers to spend more money with us," Christensen said.

Christensen and Maloney said continued development in wireless technology is the best way to ensure more and more people spend money on wireless.

Maloney said that "Wi-Fi" technology (a wireless form of communicating) will remain a popular form of communication as it is continually developed and expanded. For now college campuses and coffee shops are the most likely places to spot Wi-Fi technology, but he said in the future it will permeate everyday life.

Maloney said he is confident that businesses in large numbers will eventually change their systems to adapt to the wave of wireless technology. He added that in the long run wireless technology will become a very efficient and cost effective means of doing business.

"I don't see why wireless will slow down. I think companies are going to re-engineer their activities around mobile data," Maloney said.

He said that Intel and other companies are currently working on expanding the reach of Wi-Fi through technology referred to as Wi-Max.

Daniel Francisco, an Intel spokesman, said Wi-Max will take Wi-Fi technology beyond a small area, such as one building, and expand it from a current radius of up to 1,000 feet to a radius of up to 30 miles.

"This can be an alternative to cable or DSL. What we're looking at is this is a technology that will connect Wi-Fi hotspots to the Internet. It has particular implications in places like rural areas where they don't have broadband and in emerging markets. It has the same high performance quality as cable or DSL, but it has a lower cost and we think it will allow more people to connect to the Internet," Francisco said.