If You Can’t Beat Them Join Them: How Operators Can Take on the OTT “Threat”


Today we are seeing a paradigm shift in the way that consumers, as well as businesses and entrepreneurs, are taking utilizing technology, the internet and the mobile world. When provided with an open and extensive platform such as the Internet, which has literally made its way into almost every household in the world today (as well as people’s pockets), and that it affects how the world works today more than ever before, business people, entrepreneurs and visionaries begin formulating opportunities for revenue generation. We have seen start-ups take off and take over the world more virally than the outbreak of the H1N1 pandemic of 2009. The most common products of these virally infectious start-ups, with their cutting-edge products, has been the emergence of Over-The-Top content (OTT) in the delivery of online audio and video services, as well as similar services pertaining to messaging and online communications.

Other more traditional companies have begun to suffer in response to these products and services, due to the fact that the engines of their revenue generating business models have been deprecated, and outdated by these up and coming services. US Telco provider AT&T has recently rolled out a restriction of running Apple’s FaceTime video calling service on their network, except under certain restrictions, due to its foreseen deficit resulting from such a service (read more here). Back in January 2011, research firm TeleGeography reports that Skype accounts for about 25% of international call minutes, and that the trend is increasing; naturally this hinders the revenues generated by local telephone operators worldwide.

Net Increase in ILD and Skype Traffic, 2005-2010
Net Increase in ILD and Skype Traffic, 2005-2010 (Source: TeleGeography)

More such studies and statistics by TeleGeography can be found here. Other examples of such disruptive innovations are growing and emerging by the day, with recent services such as Viber, WhatsApp and Apple’s iMessage, and their respective popularity wars. So the question lies herein, how are these large Telco companies going to survive this new wave of emerging OTT technologies?

Operators Should Adapt and Adopt Rather than Oppose and Suppress

A traditional business sense, which coincides with our primal human nature, is to “defend” ourselves against our “enemies”. And such may be the best option in certain scenarios, however in the fast-paced technology sector my take is, don’t waste time with petty arguments, because after this big wave is going to be a bigger stronger wave. What am I getting at? Well it’s simple really. We’ve seen from the examples given that Telco’s are very resistant to these new emerging technologies and are even attempting to suppress them in certain cases. It makes sense; these new technologies are competing and thus “threatening” their revenues and so they must be stopped… NO!!!

No Negativity Allowed Here

Telco’s should be smarter, not stronger. For the sake of the economy, encouraging entrepreneurial endeavors, as well as providing their customers with new and improved services at lower costs, it would be very unwise to “fight” this so-called competition that Telco’s are facing and instead should embrace it and collaborate by adopting new technologies and services into their already-existing portfolios. Some of the currently emerging and future upcoming services and technologies are inevitable and will drive the market sooner than later and hereby I propose that it is more expensive to fight your allies, than to work together in order to create more advanced and better services for your customers (not to mention that you kinda owe it to them).

Anish Shivdasani reinforces this notion in in his blog post Mobile VoIP: operators and OTT players get down and dirty, pertaining to the mobile VoIP field where he states that “the shift to mobile VoIP is inevitable — operators should proactively commence the migration towards VoIP whilst managing the impact on traditional voice revenues”.

What’s the Point?

Simple! The sooner that these already-existing firms begin to realize that they will be better off embracing these new technologies, by adopting new enhanced business models and developing new and evolved services, the greater their market shares will grow, in less given time. Consumers want to take advantage of better services, especially if they’re being provided at same or similar prices with better functionality.

Abraham Lincoln

How can they do this?

The methods are endless, the sky’s the limit and your only barriers are the extents of your creativity as a technical professional. I will not delve too deep into this; otherwise I would be providing a free online consultation service for the whole world to see. 😛 But some of the very simple techniques that I can think of, off the top of my head, are techniques such as deploying local Content Delivery Networks (CDNs) for enhancement of certain services (especially for media rich content-delivery), or applying specific Quality-of-Service (QoS) techniques to prioritize certain traffic that pertains to these network services to provide better quality to the consumers, or even provide some sort of a strategically priced package for such services to the customers so they may leverage the use of these cheaper services.

Make Friends Not Enemies
Wise words!

The bottom line is that by creating strategic alliances with specific OTT service providers, the current traditional service providers can actually leverage their positions in the market by adapting and adopting, rather than hurting themselves by opposing and rebelling new emerging services… it is a new age and a new of thinking to survival, hand-in-hand with technological advancement.

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2 thoughts on “If You Can’t Beat Them Join Them: How Operators Can Take on the OTT “Threat”

    1. Hi Sarai, glad you enjoyed the post… and sorry for the extremely late reply. 😛

      My twitter handle is @TechNodeJohnny… and you can keep up with some tech news via my other twitter handle @TechNodeNews. 🙂

      Like

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