While CSPs worldwide grapple with how to monetize their services it appears that many â€˜over the topâ€™ or OTT players continue to grow their mobile revenues. Amazon.com is the latest to announce record results with generated revenues of $1 billion from mobile purchases during the last 12 months.
CEO Jeff Bezos revealed this during the Amazon’s Q2 earnings release, and stressed the importance of mobile phones and tablet computers in the company’s future plans but he did not mention the role CSPs are playing in this success or how Amazonâ€™s activities could benefit them. The news comes just a few days after Amazon revealed that e-books for its Kindle device are now outselling hardback titles.
Of course, there is nothing stopping a CSP from becoming an Amazon reseller or affiliate but one assumes the margins would be a limiting factor. eBay is also banging the mobile drum, having seen its iPhone app downloaded 11 million times. It’s also predicting mobile revenue of $1.5 million this year.
Bezos said: “We’re seeing rapid growth in Kindle, Amazon Web Services, third-party sales, and retail. We’re also encouraged by what we see in mobile.â€
“The leading mobile commerce device today is the smartphone, but we’re excited by the potential of the new category of wireless tablet computers. Over time, tablet computers could become a meaningful additional driver for our business.”
The reality, however, is that Amazon is not just a book store anymore. Yes, books are still a big part of its business, but Amazon has morphed into a retailer of consumer electronic products and general merchandise.
The company generated more than half of its revenue from electronics and other merchandise. Media like books, both digital and physical, music and DVDs made up 44%. All of these â€˜electronicâ€™ goods are delivered over somebody elseâ€™s network and the network operator has become a utility for the transport of those goods.
You canâ€™t blame companies like Amazon from â€˜taking advantageâ€™ of the dramatic improvements being made on mobile, and even fixed-line networks, but how long can CSPs afford the capex required to increase bandwidth generated by this type of increased traffic.
Arrangements exist between CSPs for the transit and termination of external call traffic and, in many cases, data traffic across each otherâ€™s networks.Â CSPs have the technology available to track data traffic and where it has originated from. How long before they start to charge high-volume traffic generators on their network for the privilege? Who will be the first to set up this sort of pay-wall or tollway? The idea is not that far-fetched, is it?