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OTT, M2M, Big Data and the Cloud drive the Global Telecoms Industry 29 Jul 2014
The broader telecoms environment continues to be very challenging in 2014 and looking towards 2015 there still are many technological, economic and regulatory changes that the industry faces. The market is highly competitive and ruthless with those operating in the telecoms, mobile, broadband, digital media and ICT industries alike all scrambling to retain and build new revenue streams.
Every day hundreds of thousands of new devices, as well as new people, are added to the telecommunications networks that span the globe and there is no indication whatsoever that the demand is going to slow down any time soon – we see it continuing for decades to come. Yet, at the same time, many telcos and ISPs are struggling to maintain their profitability.
This defies economic logic. Market economics will tell you that when demand increases companies are stimulated to build more in order to sell more; and if that doesn’t happen other companies will happily step in to take up the slack and compete for that extra demand. But this is not happening in the telecoms market. Operators are dragging their feet in the building of new infrastructure – in particular new fixed infrastructure such as FttP. In the mobile market also we see great problems on the supply side, with network congestion and network breakdowns.
In these conditions; the telecoms industry is again realising the importance of the customer as increased competition and economic pressure forces the operators to attract and retain customers. New tools and techniques are now being deployed to assist this process, with real-time processing and data analytics being used to improve the customer experience. Operators are also increasingly reviewing service packages in order to entice the customer.
While data management is becoming critical to business operations – very few companies have a good understanding of where their data is at any given time. As well as this; the enormous amount of data that is now being collected is placing a real strain on infrastructure, software and services. There clearly must be more intelligent ways to manage the data and both cloud deployments and Big Data analytics will remain hot trends for the near future. Indeed by 2015, BuddeComm can see that “the cloud” will be just another delivery model for a range of "as-a-service" offerings.
The role of external data centres are set to increase with organisations embracing this concept. The data centre market includes tele-housing facilities, co-location facilities, cloud and IT services, content hosting, connectivity and interconnection. They are important for the emerging developments surrounding cloud computing and the Internet of Things (M2M).
Mobile technology and smart devices continue to lead the way and mobile broadband has in fact become the fastest growth area for the overall telecoms sector. This in turn sees the number of Internet users continues to increase as the penetration of both fixed and mobile broadband becomes more accessible around the globe.
While the story for the traditional players in the telecoms market is all about shrinkage, on the other hand we see significant growth in many of the new subsectors of the broader ICT market, which includes cloud computing, data centres and M2M. The big picture reveals that many of the benefits and opportunities for telecommunications stretch far beyond the network and apply to social and economic benefits, healthcare, education, digital economy, businesses, new job creation and the green economy. All of these are potential opportunities and benefits that can be created on top of a robust global telecommunications infrastructure.
For detailed information, table of contents and pricing see: Global Telecoms Industry - Key Trends - OTT, M2M, Big Data and the Cloud
The Australian Calling Card Market in 2014 28 Jul 2014
In late 2012 M2 acquired a 32% stake in Aggregato Global through the divestment of the company’s calling card business, which was an asset acquired with iPrimus in May 2012. Aggregato is a company operating in both the Australian and American calling card market, and the broader prepaid mobile market
|Aggregato Global Limited provides optimised prepaid telecommunication solutions in Australia and the United States. The company provides mobile, long-distance international, and voice over IP via mobile applications services. It serves consumer, corporate and wholesale market segments. The company was founded in 2012 and is based in North Sydney, Australia.
They acquired or merged with the calling card operations of Access International, Australian Telecom and US-based Krush Communications LLC, before taking over Tele.Pacific
The largest acquisition so far happened in early 2014 when Aggregato bought Tel Pacific, which had been struggling in the rapidly declining traditional calling card market. Tel Pacific’s earnings before interest, taxation, depreciation and amortisation (EBITDA) for the six months ending 31 December 2013 was $3.1 million, which was down 36.5% compared with the same period one year earlier. Aggregato Global bought the company for $19 million. This brought in an extra 400,000 customers, bringing the total of regular calling card business to 700,000 customers.
The prepaid calling card business continues to face a challenging future, with ongoing competition and declining revenue growth, particularly driven by the trend towards prepaid mobile products.
Calling card and prepaid companies face rising competition from internet-based service providers like WhatsApp and Skype, which often provide free messaging and video calls overseas.
The calling card business is now largely targeted towards customers who cannot afford the internet connection that other services depend on. This is a very cost-conscious and largely ethnic customer market.
The future for any company operating in the market needs to be based on the lowest possible cost model. What makes the Aggregato business interesting in this respect is the fact that it taps into a new US-based technology that runs on a pinless platform. This technology removes the hassle factor from the procedures as there is no longer the need for customers to dial a service number before entering the pin code from the back of their calling cards. It also means a totally automated process.
This platform recognises the customer’s phone number and enables them to dial directly at the heavily discounted calling card rates.
Pinless Retail Web Portal from Krush
|Krush Communications LLC was a privately held telecommunications company known for the Homies brand and a pinless retail web portal space. The merger with Aggregato created a US entity focused on the development and consolidation of prepaid pinless services, white-label MVNO options. The key reason for the merger was Krush's patented pinless web portal technology that will be made accessible from more international destinations.
See also: Australia - Telecoms - International prepaid calling market
Mobile services capitalising on low fixed-line connectivity in Africa 25 Jul 2014
Accurate figures for mobile penetration in Africa are complicated by the popular use of multiple SIM cards in some markets. This has led to penetration rates of 150% or higher in a few countries, though given the diversity of the region penetration rates vary considerably, with Eritrea and South Sudan sporting very low rates. In general terms, higher penetration can be seen in several southern countries, including Botswana, South Africa, Zimbabwe and Namibia, as also in the north from Morocco to Egypt and in a number of West African states including Gambia, Ghana and Gabon. A large band of sub-Saharan and central African countries, often characterised by thinly populated areas or socio-political unrest, have relatively low penetration. Average penetration for the continent reached about 75% by mid-2014.
To some degree the sharp variable in penetration rates are evening out as countries at the lower end of the spectrum, such as Ethiopia, are typically recording far faster growth rates than those at the upper end.
Growth in the use of mobile voice services is largely stimulated by network coverage and quality of service. The latter is increasingly recognised as important by regulators who are prepared to fine operators for poor QoS, or temporarily suspend their ability to attract new subscribers until remedies are made. Another stimulus is poor fixed-line infrastructure which had rendered mobile connectivity as the only viable telecom service in many areas. This applies both to voice as well as internet services, though the latter are still largely geared to the 2G environment.
As a result of fixed-line limitations, mobile services still represent more than 90% of all telephone lines in service. The popularity of cheaper prepaid services, which in some markets account for up to 98% of all mobile subscribers, as well as a steady fall in tariffs has meant that an increasing proportion of the population can both access and afford a mobile phone.
Some market consolidation continues to occur in the region, with a small number of players, notably Bharti Airtel, MTN, Orange and Tigo, now having a significant multinational presence. In early 2014 Etisalat sold to Maroc Telecom its Moov-branded mobile subsidiaries in Benin, Burkina Faso, Central African Republic, Ivory Coast, Niger and Togo. The deal enabled Maroc Telecom to consolidate control of the West Africa operations and make use of its experience in this region. Newly introduced converged licensing regimes have also increased competitive pressure among operators, and have enabled them to branch into new service segments.
For detailed information, table of contents and pricing see: Africa - Mobile Voice Market and Major Network Operators
Iran shows progress in 2014 with fibre network deployment 24 Jul 2014
In recent years the international community identified Iran as lagging behind in terms of broadband infrastructure and access, particularly when compared to other GCC member states. However in 2014 there are encouraging moves underway to improve this situation, with the FttX operator Iraninan-net currently deploying a fibre network which aims to have 8 million customers by 2020.
Broadband penetration is also improving due to the growing number of competing ISPs, made possible through a licensing scheme. Competition has also improved following the launch of alternative infrastructure-based offerings centred on WiMAX.
In 2014 there are four companies licensed to provide WiMAX services, including MobinNet, MTN Irancell; MTCE and Rayaneh Danesh. In 2013 Datak Telecom failed to obtain ongoing authorization to continue to offer WiMAX services.
Despite these progressive developments; censorship in Iran appears to be increasing with Iraq utilising China’s experience on how to implement Internet control using Iran’s National Internet Network. In addition social media apps have been banned at various times including Instagram, Facebook , YouTube and Twitter and all Iranian’s are required to register their websites with the Ministry of Art and Culture.
Other potential inhibitors to growth in Iran include the government’s tight control of the telecoms market combined with the general economic situation and international sanctions. One bright spot however is the mobile sector which has shown strong growth.
With a young population willing to embrace technology; Iran has seen huge growth in mobile subscriber numbers in response to competition over the past 8 years. It now has nearly 90% mobile penetration and there is still room for continued revenue growth. Mobile data services are available but account for only a small proportion of total revenue. This is expected to increase over time as it becomes clear that mobile data services will increasingly underpin future revenue growth.
For detailed information, table of contents and pricing see: Iran - Telecoms, Mobile, Broadband and Forecasts
Wireless connectivity to promote road safety 23 Jul 2014
Australia has a current competitive advantage in this potentially enormous field due to two pre-eminent research and development organisations:
- The Australian Centre for Field Robotics at the University of Sydney, acknowledged as number 1 or 2 in the world in driverless vehicle operation in commercial operations such as mining and container handling
- The Institute of Telecommunications Research at the University of South Australia and especially the start-up company Cohda Wireless that has developed the IEEE 802.11p radio sets that are essential for V2X communications
Furthermore Telstra Australia is innovative and has the systems integration skills to develop a national approach to integrate driverless vehicles with vehicle to vehicle/infrastructure communications to achieve a dramatic improvement in road safety and efficiency
The Warren Centre is initiating a project which will aim to identify a way ahead to achieve an order of magnitude reduction in the risk of road deaths building on Australia’s leadership of Wi-Fi technology. It will seek to bring together four key areas – road agencies; vehicle designers and regulators; telecommunications service providers and regulators; and human machine interface and systems experts.
It is hoped that the outcomes of this project will provide a new focus for rejuvenating Australian industry through application of innovative technologies which will ultimately lead to a dramatic reduction of the social and economic cost of road accidents.
See also: Australia - Smart Transport, Smart Cars
Fiji - Internet penetration increases as mobile broadband helps bring access to the people 23 Jul 2014
Fiji is one of the largest of the Pacific Island countries in terms of population, with just under 900,000 living there. The majority of the populace ie, around 85% live in just two of the more than 100 inhabited islands. Economic growth in terms of GNI has continued to increase since 2010 as the interim government continues to oversee the country’s operation until the parliamentary elections for a new government are held in September 2014. Further growth through to 2014/15 is expected to slow, possibly pending the election results. Tourism continues to play a major role in the economics of the islands.
While the fixed-line telephone and broadband market has seen substantial reductions from its small base, the introduction of mobile telephony has been similar to what occurs in most countries. The current government has made many fundamental changes that have brought mobile telecommunications and its economic benefits being available to the people of the islands. The increase in mobile broadband and the introduction of tele-centres that provide free access has seen internet penetration increase by double-digit figures since 2010 as additional users gained access to the internet. The international submarine connectivity through the island from Australia to the USA is now providing faster connectivity to some of Fiji’s neighbours even though they are around 1,000kms away.
Mobile communications availability covers the majority of the population with more than 100% SIM penetration occurring with around 95% using the prepaid option. The pricing reductions in data and hardware together with an increase in bandwidth availability has seen mobile broadband penetration increase dramatically over the last couple of years.
For detailed information, table of contents and pricing see: Fiji - Telecoms, Mobile and Broadband - Market Insights and Statistics
Steady rise in El Salvador’s mobile broadband customer base 22 Jul 2014
Relatively densely populated, El Salvador is the smallest country in Central America. Economic prosperity has been stymied by income inequality, poor infrastructure and inadequate social capital.
Despite these difficulties, the telecom sector has been one of the more successful in the economy. This is particularly true of the mobile telephony and data sectors, which are emerging as the country’s preferred telecom services given the poor state of fixed-line infrastructure in many areas. The use of text messaging and multimedia has gained traction as an alternative for voice services, and there is a clear trend towards services supported by 3G networks as these are expanded by network operators.
El Salvador’s fixed-line teledensity is substantially lower than the Latin American and Caribbean average. However, there has been a significant drop in the number of fixed lines since 2010, largely due to the substitution for mobile-only alternatives.
Mobile penetration is remarkably high considering El Salvador’s economic indicators, being about 35% higher than average for Latin America and the Caribbean. Of the estimated total number of telephones in the country, 11% are fixed and 91% are mobile.
El Salvador’s telecom legislation is one of the more liberal in Latin America, encouraging competition in most aspects of the telecoms sector and permitting foreign investment in all areas. However, there are no regulations as yet which promote wholesale broadband, and thus the ADSL market remains a virtual monopoly for Claro. The only effective cross-platform competition in the broadband market comes from the few cable operators.
Although many companies launched services when the telecom sector was liberalised, the market has been undergoing a gradual process of consolidation, leaving a few dominant multinational operators (notably Millicom’s Tigo, América Móvil’s Claro, and Telefónica’s Movistar), which have managed to expand into almost all sectors through a process of convergence.
The mobile market is served by five operators: Tigo, Movistar, Claro, Digicel, and Intelfon.
The fastest growing sectors in coming years will continue to be pay TV and broadband (both fixed and mobile). The outlook is especially promising for mobile broadband, which could help to bolster the slipping mobile ARPU figures in the medium term. The longer-term prospect is also promising, particularly in the mobile sector where competition between Claro, Tigo, and Telefónica will oblige the operators to diversify services and reduce prices.
For detailed information, table of contents and pricing see: El Salvador - Telecoms, IP Networks and Digital Media - Insights and Statistics
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