As much as service providers across the communications business worry about the threat of value erosion, with increasing amounts of the actual value of broadband-enabled applications shifting to devices and applications, it does appear that service providers are making adjustments.
And those adjustments seem to be coming in both the transport business, which might the closest analogy to a communications service that traditionally has been about “transport” services, as well as in the mobile business that arguably now represents the venue where most application activity is focused.
“Raw capacity (and especially raw intercity fiber count) means nothing compared to the capabilities you enable, the services you offer, and the content you deliver,” argues Telecom Ramblings. Fiber glut?
It might be argued that intercity fiber exists today as an enabler. Whether you lease waves, hold fiber IRUs, or built the conduit yourself, what it does for you is enable the rest of your product portfolio, Telecom Ramblings says.
For metro-focused infrastructure players, it connects up their markets and lets them serve regional customers all on-net. For enterprise-focused players, it helps maintain end-to-end control and keeps margins up. For cloud-focused players, it helps control latency and service quality.
Long haul capacity increasingly is bundled with metro transport and access, content delivery services, collocation and other managed services. Some might even argue that much of the “raw bandwidth” business will cease to exist.
Much the same sort of thinking occurs in the retail mobile business as well. Mobile operators will be forced to up the ante on innovative business models if they are to survive, says Ericsson.
Ericsson predicts that maturing markets and heightened competition will force mobile service providers to dramatically shift business models.
Borrowing from approaches more common in financial services and airline industries, loyalty, user profiles and preferences and customization will become more common ways of providing new value on top of basic access, Ericsson predicts, especially for business customers.
Mobile money, Near Field Communications and cloud based services are some examples of new approaches that will change the value proposition.
Ericsson sees some shifts as particularly affecting markets iin Southeast Asia and Oceania in 2012. Asia Pacific region in 2012.
In the “local access” markets, “services and applications” are the norm, not the exception. Video and voice are, by definition, applications and services rather than “mere” access. Only the new broadband access service is in large part a “pipe” that gives users access to the Internet.
And even there, some might argue that the value actually includes all of the processes that allow Internet access to happen, including assigning and managing IP addresses, providing user authentication and other services.
Bundling anti-virus and security services, storage or other applications provide further examples. The point is that “dumb pipe,” though an under-estimated source of business value, rarely provides the value sold to an end user.
Those sorts of changes probably are clearest in all the parts of the business that deal with transport and access services, even though there seemingly always will be demand for dark fiber and “raw capacity” at a wholesale, carrier-to-carrier level.
On the retail services end of the business, simple broadband access increasingly is bundled with other services.
Gary Kim is an active industry writer and analyst, editor of Mobile Marketing & Technology, Content Marketing News and Carrier Evolution. He is a frequent contributor to IP Carrier and TMCnet, and a good friend of Razorsight. Keep up with all his industry insight -- follow him on Twitter @garykim.
0 comments:
Post a Comment