Global - Analysis - Industry - Transforming telco models - progress in 2004

Synopsis

For many years it has been my contention that in times to come IT will be the driving force behind the telco industry. If they are to maintain their relevance in the future, today’s telcos will have to become more like IBMs, HPs or Microsofts. In ten years’ time 90% of telco revenue will come from broadband-delivered (data) applications; only 10% will be voice-based (fixed and mobile). While the telco industry has been slow to move in this direction, things are gradually changing. Over the last few years the focus has been on applying new IT technologies for cost-cutting purposes, rather than on exploiting the new IT opportunities to increase revenues. In an effort to preserve the traditional mode of business, and to avoid cannibalisation, new developments were deferred. VoIP is now going to speed up this process. This report was archived in 2005.

Table of Contents

• 1. Synopsis
• 2. Related reports
• 3. Changing to Facilities based Models
• 4. Turning Carriers into Multi-Service Operators
  • 4.1 Introduction
  • 4.2 Service Level Agreements
  • 4.3 VPN Solution
  • 4.4 New revenue-generating applications
• 5. Changing telco business Models (Analysis update March 2004)
  • 5.1 Improved results
  • 5.2 Disruptive developments
  • 5.3 Incumbents do need to change
  • 5.4 Competitors need to become more sophisticated
  • 5.5 Urgent need for consolidation
  • 5.6 Trench warfare and guerilla activities
  • 5.7 Business processes
  • 5.8 Customer service
  • 5.9 More cost to cut
• 6. Observations made during 2003
  • 6.1 No future in ‘more-of-the same’ services
  • 6.2 New broadband players are leading the charge
  • 6.3 There is business in value-add
  • 6.4 Technology players are delivering
  • 6.5 Telcos will have to kick start
  • 6.6 Financial markets hamper telco recovery
  • 6.7 Under-investments in the CAN
  • 6.8 Over-investments in the long haul
  • 6.9 Infrastructure in economically unviable areas
  • 6.10 A natural monopoly
  • 6.11 Formal or informal structural separation