It is finally getting through to the telco C-suite – innovate and unite, or suffer the consequences. The message came loud and clear (as reported by European Communications) when Cambridge Wireless chairman Dr David Cleevely, addressing the recent 2012 Future of Wireless event, said that although the wireless industry has created “the most successful and ubiquitous platform in human history”, operators are “rarely the source of innovation or the main beneficiaries”.
Cleevely felt that worrying about how to drive new revenue, create value and fight off threats from OTT players remain some of the preeminent questions facing telcos. Consequently they ‘must innovate’ or risk ‘losing.’ By ‘losing’ he presumably meant ‘losing out’ to OTT players and others we may not even know about yet, that are investing heavily in innovating new services that could be launched with, or without, the direct involvement of CSPs.
Keeping a watchful eye on the market place and buying up any promising new ventures is one way to keep on top of things, or investing in a number of new start-ups in the manner of a venture capitalist is another.
No doubt, the big players are watching Telefónica’s Wayra efforts with a mixture of interest and trepidation. If that model succeeds, it will prove telcos can be innovative, but it may also create a mega-competitor of theirs in future, or even a supplier of services they may have to pay licence fees to. Would that make them any lesser evil than an OTT player?
Everything Everywhere CEO, Olaf Swantee, was also present and responded by warning that there would be “a significant deterioration” in customer experience if the UK fails to move to 4G and quickly, something his company is focussed on. All business models will need to be based on data that will need a credible, simplistic pricing model that is transparent for customers. Innovative pricing, it seems, will be part of EE’s 4G strategy as will partnering with OTT providers, that he also alluded to.
This guy gets it! He followed up at a subsequent event in London, the launch of the DigiWorld Institute’s 2012 Yearbook, by saying operators did not have ‘the same ability’ as OTT players to provide software. He also pushed the point that CSPs needed to co-operate more with each other and engage in more constructive dialogue.
No doubt part of his message was aimed at the other UK operators critical of Everything, Everywhere’s 4G head start. Swantee also said: “Our industry has a tendency to use too much litigation. We need to stop fighting each other and support Ofcom to get 4G moving.”
He also pointed out that the current wireless infrastructure is not future proof and that the OTT players continue to take a bigger part of the revenue “pie.” He called on operators to move to a more IT centric model of service provision and highlighted M2M and mobile advertising as two “clear areas of focus”.
Nothing new there, you may say, but Swantee is fast-becoming quite the spokesperson for the industry. It’s a role most CEOs steer well clear of. Sticking one’s head above the parapet and daring to speak out openly about issues that all CSPs face is tantamount to career suicide, or so it would seem.
Let’s hope Swantee is not lost if rumours that his company’s owners, France Telecom and Deutsche Telekom, are reportedly in discussion with a private equity firm about a potential sale. Our industry could certainly use a credible ‘front man’ just now.
First published at TM Forum as The Insider, 3 July 2012