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Telecoms Industry Issues survey 2008
30/05/08
The biggest
concern for telecommunications executives is the loss of landline
revenue and the threat of emerging IP-based competitors.
That’s
according to a new survey by JAJAH, whose Q2 Telecommunications
Industry Issues Index suggests that IP-based Value Added Services,
international calling and new pricing strategies are seen as the
best opportunities to replace lost revenue, though many companies
have yet to clearly define their IP strategy.
To gain a
deeper understanding of carriers' perceptions of the ongoing shift
in the global telecommunications industry and to drive product
development, JAJAH conducted delegate research at CTIA and in-person
one-to-one briefings with chief-level executives at
telecommunications companies in the U.S. and Europe. According to
the JAJAH study, new networks, competitors and connectable devices
are placing an unprecedented burden on global carriers as they try
to remain central to their customers' "connected life."
Consumer
behavior mirrors industry trends and pain points. A recent National
Health Interview Survey conducted by the Centers for Disease Control
showed that nearly one in six American homes (15.8%) had no home
landline, and that nearly three in 10 households have only a cell
phone or seldom, if ever, use their traditional phone.
Global
carriers face a new style of competition where anytime, anywhere,
interconnected voice and data services put significant strain on
networks and product innovation. With domestic markets heavily
penetrated, international markets will play a bigger role in future
revenue and market growth. Whilst IP-based operators can enter
markets with little or no infrastructure the JAJAH research shows
many carriers remain without a go-to-new-market strategy.
Key
findings from Q2 Telecommunications Industry Issues Index:
Landline
churn: The biggest fear amongst fixed line telecommunications
companies is the loss of landline connections. Four out of five
companies put landline replacement revenue at the top of their
agenda.
Value Added
Services the saviour? The majority of carriers rank the addition
of Value Added Services to their portfolio as a higher priority than
their network. Two-thirds of chief-level executives state Value
Added Services are the single most important factor for increasing
customer loyalty and revenue.
Talkifying
the Web: It is unclear how to deal with the perceived threat
from "new-style" competitors, with two-thirds more concerned about
IP-based competitors than new triple-play competitors.
IP
telephony strategy gap: Many companies identify significant room
for advancement in IP telephony strategy. Two-thirds stated IP
telephony represented the future of telecommunications and are
looking to carrier-friendly companies like JAJAH to partner with to
quickly advance its IP offering and IP backbone.
The future
is international: International markets hold enormous potential;
Ninety percent expect significant revenue growth abroad, rather than
in domestic markets in the next five years.
Infrastructure investment black hole: With a lack of funding for
infrastructure investment, more than 60 percent of the executives
questioned believe they will outsource a greater proportion of
infrastructure development by 2009.
Triple play
boom: Service expansion by telcos will lead to an increase in
triple play offerings in the U.S. and Europe in the next twelve
months.
More than
one-third of single and dual play companies plan to launch a triple
play offering within the next 24 months. Of those companies looking
to expand into IPTV, more than half will do so via acquisition.
Where once it
was a race to lay pipes, JAJAH's report outlines the goals in the
new battlefield -- Value Added Services, preservation of customer
base and diversification of revenue.
Service
bundles, technology convergence, increasing global competition and
decreasing margins are driving a major shift in the
telecommunications industry, says JAJAH. It is really encouraging
that the biggest companies in the industry are embracing the concept
of IP-telephony as a source of revenue protection and growth. With
our open IP platform and managed services, JAJAH is working with a
number of companies in the industry to help them embrace IP and turn
competition into co-operation.
Nick Gibson, editor
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