The whitepaper report discusses how increased competition and a changing legal background have impacted upon the EMEA telecoms industry. Looking forward, it also highlights the five key areas mobile and fixed line carriers will have to consider when making future plans for their business.
The combination of exponentially increasing data volumes over the last five years and greater competition from new entrants to the telecoms market has caused carriers to dramatically reassess their business models as they try and match investment and focus to the needs of a data-driven world.
“The telecommunications market is going through its biggest era of change since the introduction of mobile telephony,” said Jon Fell, partner, Pinsent Masons. “The first response of carriers to the changes of the last five years was to try to become all things to all people. However that risks losing focus as it adds new challenges potentially outside their traditional experience. As markets change their new business models have to concentrate on their key strengths – the operation and management of networks, essentially selling their capacity to others and becoming managed services providers, sweating their network assets to deliver profits.”
The whitepaper report identifies the following five key areas for carriers to consider in the future:
- Coping with the data explosion
Carriers need to focus on developing their infrastructure to cope with the massive current and predicted increases in data, both through mobile devices and higher usage of technologies such as video streaming in the home. Ensuring they have sufficient capacity will involve a combination of investment in building new infrastructure and sharing existing networks with others, as well as developing an accurate understanding of future needs.
- Spectrum Use
Carriers need to look how they can best use the spectrum and consider whether spectrum sharing strategies (where allowed) are efficient. As spectrum comes up for auction, such as the digital dividend spectrum that is being made available in the forthcoming UK spectrum auction, the operators need to focus on the best use that can be made of it to meet traffic demands. This may include 4G, will need to consider the better use of existing technologies and frequencies to drive efficiency and greater capacity.
- Mobile Payments
Increasingly consumers and businesses will be using their mobile phones to pay for goods and services, both physical and virtual. Carriers have to make a decision – do they go back to basics on being a carrier or aim to add more value in the ecosystem with a greater role, as either a facilitator, providing connectivity and services, or acting as a fully-fledged bank themselves.
- Use of smart devices for work
More and more people are now bringing smart devices to work, which is driving a need for better security, particularly given the move to the Cloud. Do carriers extend security through third party partnerships or put pressure on operating system and handset developers to force them to be more secure? Either way, carriers have to take this threat seriously and decide what level of security they are going to provide to end users.
- Regulatory changes
In the UK there is currently a review of the Electronic Communications Code and carriers need to be involved, particularly in light of regulatory pressures to grant network access and share infrastructure. Europe-wide regulators are looking to push down prices and ensure universal coverage, but in many cases this involves extending infrastructure to unprofitable areas, particularly where people are using lots of data. Carriers need to decide if they concentrate on maximising efficiency in their core business or expand into other areas.
Pinsent Masons has advised suppliers and users of fixed line and mobile telephony on matters in connection with procurement, supply, and regulatory aspects of their telecoms projects. Pinsent Masons has supported many telecoms companies including Cable & Wireless, Arqiva and Nokia Siemens Networks.
To receive a copy of the full whitepaper, please visit http://www.pinsentmasons.com/PDF/TelecomsWhitepaper0412.pdf
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