3 Ways for Telecoms to Compete in New Digital Ecosystem
Companies in the telecommunications industry are in the fight of their lives. Operators, CPE manufacturers, media companies, software vendors, and Internet players have invaded each other's previously clear-cut turfs. Over-the-top (OTT) players have become a major source of revenue cannibalization. For example, players like Netflix and Hulu are directly cannibalizing telco and cable operators' TV revenues. Similarly, applications like Skype and WhatsApp have made serious dents in operators' voice and SMS revenues. To make matters worse, the bandwidth needs of these OTT players exponentially increase the cost of building and operating telecommunications networks.
This exponential increase in bandwidth consumption is not accompanied by an equivalent increase in revenues for operators. The industry's fear is that the cost of providing connectivity could at some point outpace revenues generated. Many have tried to strike back with their own content platforms and services, with little success.