Mobile operators: looking to the future

Taking a close analysis of a recent trend that has grabbed the telecommunications sector, the Average Revenue Per User (ARPU) for voice services has been decreasing.

This is mainly due to people opting for cheaper data services which enable users to chat or even call each other over mobile networks.

Even as they need to build a new generation of high-speed fixed and mobile networks, their traditional sources of revenue are being commoditized, making it that much harder to raise the funds needed.

Networks are being threatened by services from Original Equipment Manufacturer’s own services (Apple App Store, Nokia Ovi, Sony Ericsson PlayNow, RIM Blackberry

services), the entry of alternative payment providers (Apple iTunes, PayPal Mobile, Google Checkout), alternative voice providers (Skype, Google Voice) and of course the myriad of social networking services (epitomised by Facebook and Google+).

Three major trends

Simultaneously, three major trends: demand for ubiquitous connectivity, the rise of modular technologies, and increasing competition from outside the industry, are transforming how all the players in the telecom space are creating value. I am sure 10 years ago no-one would have ever foreseen something so fundamental as calling becoming so easy and affordable for consumers. Arguably, the VoIP functionality is the major threat with data costs tumbling almost each month. In South Africa currently there are “broadband wars” just over who offers the cheaper, bigger and faster data service.

The relevance of this realisation is the mere fact that Zimbabwean operators should now think much further ahead in terms of their data capabilities, applications that their platforms offer as well as connectivity to the undersea cables that have surrounded most of Sub-Saharan Africa.

Currently Zimbabwe has access to two undersea cables, Seacom and EASSy and amazingly the link to both those cables is our own parastal TelOne. This raises the question, when will Econet , Telecel, and Netone tap into this great resource?

Considering that Econet, through Ecoweb, claims to have fibre links all over the country then surely data connectivity should be a breeze.

How to monetize

Of course it seems that this has dawned slowly on most operators as they now sell broadband Internet dongles and mobile WiFi hotspot devices at flat-rate bundles.

But mobile broadband continues to present an opportunity to the mobile ecosystem overall. The challenge for operators is how to monetize this opportunity.

Interesting points were highlighted in an article published in Teletimes International stressing that operators must strive to move away from traditional vertical structures and shift to horizontal business models that promote shared opportunities in this hypercompetitive market. Those who have a strong backhaul should look into how best to offer the infrastructure services needed for the rest of the industry to operate. The aim being to offer differentiated capabilities through scale, cost, efficiency and reliability.

Furthermore, they should offer open and reliable platforms and clouds to host and support an increasing number of specialized service and application providers, and provide them with access to target customer segments. Focus on selected customer segments, and offer targeted applications, strong content, and a differentiated user experience. In order to survive this hostile environment, mobile operators will need to be highly innovative and dedicated to the specific needs of their target customers.

No poor quality ICT: Chamisa
ICT act finally changed

Post published in: Tech

Leave a Reply

Your email address will not be published. Required fields are marked *