Current State
Over the top operators has become new normal (whatsapp, viber, netflix, etc), not just telecom services ott has impacted delivery mechanism in every industry vertical like media and broadcasting.
As more and more services are being consumed online it created a huge demand for data and connectivity.
But real value is in products that run on top. This has transformed telecom infrastructure into commodity. Products and Services are built on top of this commodity. Even if demand is increasing for telecom operators to invest more in infrastructure there is no real incentive. In most of the developing mobile markets ARPUs remains steady. Markets and Consumers need change, very fast change But vertical models are very hard to change.
Telecom operators, CPE manufacturers, media companies, software vendors, OTT players have invaded each others previously clear cut turfs. As well as now a content producer can directly deliver to consumer without being controlled by distributor or broadcaster. Phone communication(voice and text) can be facilitated by service providers directly between two international users without being controlled by a local telecom operator or regulator. This big threat is already being realised by all big and small operators around the world. First wave of defence by telco's was to put up their own ott content and products. This strategy has failed as the new rule book is being written by new people with new ideas and very fast grow and change capability that a fat old guy can never match.
Progress
Telcos are diversifying and experimenting many possibilities like mobile money, cloud offerings, OTT based apps. And telecom operator has to learn most of the things fresh as the new age product development life cycle last days and weeks not months and years as before. Trajectory changes almost everyday with a final goal intact. All components and stakeholders in this process like infrastructure, people, processes, mindset has to adopt to this rate of change.
Clones does not work. yahoo, AOL, facebook clones have failed, things have to be original and competent. New revenue models such as CPM, CPC, CPA and freemium are largely foreign to telecom industry.
Direction
Telecoms can take a positive step to become more valuable. Operators must coordinate and cooperate with all players in the digital value chain. Operators can create value by investing in and operating up core telecom capabilities to digital players. example payment, customer data like location, advertising, etc. Now operators extract 50% for sms or direct payments. It gives reason to OTT to find ways and bypass operator. This is not easy and there is nothing defined. There is not one tried and tested business model for cooperation. The exact shape of this reshaped digital future is still up for grabs. All players in this game have to revamp this mindset and innovate with cooperation to be successful in this still unfolding digital story. Its a game telcos can't afford to lose. And there is huge opportunity for technology startups to create a meaningful and valuable business riding and taking advantage from cooperation of big telecom operators.
In my next post I would be talking about verticals where new opportunities can be created, tools and software stack making it happen and possible models of the future.
Over the top operators has become new normal (whatsapp, viber, netflix, etc), not just telecom services ott has impacted delivery mechanism in every industry vertical like media and broadcasting.
As more and more services are being consumed online it created a huge demand for data and connectivity.
But real value is in products that run on top. This has transformed telecom infrastructure into commodity. Products and Services are built on top of this commodity. Even if demand is increasing for telecom operators to invest more in infrastructure there is no real incentive. In most of the developing mobile markets ARPUs remains steady. Markets and Consumers need change, very fast change But vertical models are very hard to change.
Telecom operators, CPE manufacturers, media companies, software vendors, OTT players have invaded each others previously clear cut turfs. As well as now a content producer can directly deliver to consumer without being controlled by distributor or broadcaster. Phone communication(voice and text) can be facilitated by service providers directly between two international users without being controlled by a local telecom operator or regulator. This big threat is already being realised by all big and small operators around the world. First wave of defence by telco's was to put up their own ott content and products. This strategy has failed as the new rule book is being written by new people with new ideas and very fast grow and change capability that a fat old guy can never match.
Progress
Telcos are diversifying and experimenting many possibilities like mobile money, cloud offerings, OTT based apps. And telecom operator has to learn most of the things fresh as the new age product development life cycle last days and weeks not months and years as before. Trajectory changes almost everyday with a final goal intact. All components and stakeholders in this process like infrastructure, people, processes, mindset has to adopt to this rate of change.
Clones does not work. yahoo, AOL, facebook clones have failed, things have to be original and competent. New revenue models such as CPM, CPC, CPA and freemium are largely foreign to telecom industry.
Direction
Telecoms can take a positive step to become more valuable. Operators must coordinate and cooperate with all players in the digital value chain. Operators can create value by investing in and operating up core telecom capabilities to digital players. example payment, customer data like location, advertising, etc. Now operators extract 50% for sms or direct payments. It gives reason to OTT to find ways and bypass operator. This is not easy and there is nothing defined. There is not one tried and tested business model for cooperation. The exact shape of this reshaped digital future is still up for grabs. All players in this game have to revamp this mindset and innovate with cooperation to be successful in this still unfolding digital story. Its a game telcos can't afford to lose. And there is huge opportunity for technology startups to create a meaningful and valuable business riding and taking advantage from cooperation of big telecom operators.
In my next post I would be talking about verticals where new opportunities can be created, tools and software stack making it happen and possible models of the future.
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