Telecom Outsourcing Will Grow 3% Annually Through 2020

It never is easy for any executive to clearly identify a company’s “core competence.” Asked to do so, most people cite a list of “things we think we do well.” That is not core competence. To the extent a firm has such competence, and it is possible many firms do not, it is the singular capability that competitors cannot replicate. It is not “things we think we do well,” if other competitors also can make a credible claim in those areas. As it turns out, many mobile operators find that operating access networks really is not a core competence, or at least adds little value

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Telecom Outsourcing Will Grow 3% Annually Through 2020

Survey Shows Heavy Industry Leading IoT Deployments

In 2016, 43 percent of organizations will either already be using the Internet of Things or be implementing it within their environments, according to Gartner’s survey of 465 IT and business professionals. Some 29 percent of respondents already have deployed IoT technologies. Some 14 percent expect to do so in 2016. “Heavy” industries , including utilities, energy suppliers and manufacturers are lead users at present, with 56 percent of businesses in those categories indicating that they will have implemented IoT by year’s end. “Up until now, the leading adopters of IoT have been more the industrial, heavy-industry-type businesses” involved in mining, manufacturing and the like, Gartner research Chet Geschickter, said

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Survey Shows Heavy Industry Leading IoT Deployments

Virgin Media to Add 1 Million FTTH Connections; BT to Add 2 Million

Virgin Media, owned by Liberty Global has said it will use fiber to home to connect about a million U.K. homes by 2019. That is historically unusual, as cable operators have insisted loudly that the hybrid fiber coax network is extensible enough to underpin the business. The Virgin Media decision is a rather major step towards use of a physical media platform suggesting Virgin sees an end to HFC as a market-leading platform. To be sure, there is a key difference between the protocols telcos normally run when deploying FTTH and what Virgin Media will do.

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Virgin Media to Add 1 Million FTTH Connections; BT to Add 2 Million

U.S. Consumers are Plain Unhappy with Most Communications, Entertainment Services

U.S. consumer satisfaction with fixed network telephone services has been falling since 1994. Satisfaction with Internet access providers has fallen since recordkeeping began in 2013, not to mention that ISPs rank dead last for consumer satisfaction among all industries tracked by the American Consumer Satisfaction Index. Subscription TV services are in a tie for last place among all industries tracked by ACSI. Satisfaction with mobile services generally had grown until about 2013, when satisfaction hit a plateau before dropping in 2015

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U.S. Consumers are Plain Unhappy with Most Communications, Entertainment Services

U.S. Consumer Satisfaction Falls for 8 Straight Quarters

Somehow, no matter what investments U.S. businesses are making to better serve their customers, consumer satisfaction continues to fall. A steep downward trajectory in national customer satisfaction continues, as the free fall of the American Customer Satisfaction Index (ACSI) reaches the two-year mark. The aggregate ACSI score for the fourth quarter of 2015 is down 0.5 percent to 73.4 on a 100-point scale, its lowest score in a decade after eight consecutive quarters of decline. Customer satisfaction might not be identical to the equally nebulous concept of “quality of experience,” but one has to presume that less satisfied consumers are experiencing declining Experiences with a broad array of services and products

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U.S. Consumer Satisfaction Falls for 8 Straight Quarters

Unless Cost Structures are Revolutionized, Sustainable Mobile Markets Will Feature Just 2 Providers

Sprint added 58,000 net accounts in the first quarter of 2016, including 22,000 postpaid phone accounts, part of a total net gain of 56,000 postpaid accounts. On a year-over-year basis, Sprint dramatically improved its account metrics, up about 1.5 million net accounts, year over year. Sprint still faces issues in terms of gross revenue and operating profit.

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Unless Cost Structures are Revolutionized, Sustainable Mobile Markets Will Feature Just 2 Providers

Between 2008 and 2015, Developed Market Telecom Markets Shrank

source: McKinsey The years 2008 to 2015 were troubling for telecom service providers in developed markets. And though there was growth in developing markets, average voice revenue per mobile account dropped substantially. Despite forecasts from most market research firms that prediced growing revenue on a global basis, consultants at McKinsey say telecom industry revenue actually shrank in developed markets. At the same time, fixed network voice accounts and average revenue per user dropped in all regions.  Mobile voice subscriptions climbed in all regions, but mobile voice ARPU dropped dramatically in all regions.

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Between 2008 and 2015, Developed Market Telecom Markets Shrank

Will Internet Access Revenues Grow Fast Enough to Offset Voice Revenue Declines in India?

Bharti Airtel, Idea Cellular and Reliance Communications experienced flat voice revenue and struggled with  data revenue growth in the first quarter of 2016, illustrating the “demand side” of the Internet access supply problem, as well as the ongoing difficulties in the key voice business. Simply, demand for Internet access, though growing, might not be growing fast enough to offset perhaps-accelerating losses in voice revenue. That fundamental problem is faced by most mobile operators in most markets. According to a report published by securities firm Kotak, ” 4G uptake has been slow and is unlikely to help the surprisingly slow momentum of data volume growth.” Kotak analysts expect Bharti Airtel’s  India wireless revenue to grow 3.6 percent sequentially

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Will Internet Access Revenues Grow Fast Enough to Offset Voice Revenue Declines in India?

Amazon Dominates Cloud Computing Market, But Microsoft and Google are Growing Share 100%

Source: Synergy Research In the public cloud business, scale matters. Amazon Web Services (AWS) continues to dominate the cloud infrastructure services market with a 31 percent worldwide market share. The big three followers–Microsoft, IBM and Google–collectively account for 22 percent market share.

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Amazon Dominates Cloud Computing Market, But Microsoft and Google are Growing Share 100%

Mobile Serves 88% of India Internet Access Accounts

As of 29th February, 2016, the top five fixed network high speed access service providers were BSNL (9.91 million), Bharti Airtel (1.71 million), MTNL (1.11 million), Atria Convergence Technologies (0.91 million) and YOU Broadband (0.52 million), according to the latest data from the Telecom Regulatory Authority of India. But most consumers buy from mobile providers.  As of 29th February, 2016, the top five mobile Internet access providers were Bharti Airtel (35.22 million), Vodafone (26.44 million), Idea Cellular (22.20 million), Reliance Communications Group (15.52 million) and BSNL (10.00 million). In other words, fixed networks supported about 11.5 percent of Internet access accounts.

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Mobile Serves 88% of India Internet Access Accounts

93% of Indonesian Inrternet Users Get Online Using Smartphones

Fully 93 percent of Indonesia’s 88 million internet users access the internet from smartphones , according to researchers at GfK. A GfK survey found that besides smartphones, 11 percent  of Indonesia’s users go online with desktops and five percent  use tablets. “Our study reveals that Indonesia has a very active online population who spend an average of 5.5 hours a day accessing an average of 46 apps and web domains with their mobile device each day,” said Guntur Sanjoyo, managing director of GfK in Indonesia. Indonesians spend an average of 32 hours per month each using apps.

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93% of Indonesian Inrternet Users Get Online Using Smartphones

Can Telcos Become Platforms?

Telcos can become “Integrated Digital Service Providers” (IDSPs) that function as platforms, Accenture argues, essentially getting out of the “communications” business. In yet one more iteration of the “moving up the stack” strategy, Accenture suggests telcos can become “platform companies” that use social, mobile, analytics and Internet of Things tools  to build a business architecture and set of services that enables other businesses to rapidly develop and deploy the products and solutions needed to drive their digital strategies. That probably sounds like “middleware” to some; “operating system” to others. Time will tell whether any firms actually will be able to become “digital platforms,” or whether, in the end, the effort will fail. For more than a decade, we all have heard, seen and read commentaries suggesting that “digital disruption” somehow can be turned to a traditional telco’s advantage

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Can Telcos Become Platforms?

Facebook Will be ain Internet Access Platfom Enabler or Supplier

Does Facebook’s mission of connecting the world extend beyond social applications and messaging? It is hard to come to any conclusion but that Facebook does see physical connections as part of its eventual portfolio. First off, Facebook is starting a new business unit to build “ new hardware products to advance our mission of connecting the world,” says Mark Zuckerberg, Facebook CEO. Also, Facebook’s 10-year roadmap clearly indicates that a variety of access platforms are planned, ranging from unmanned aerial vehicles to satellites to lasers to “terrestrial solutions” and “telco infrastructure.” That does not necessarily mean Facebook everywhere and always–or even primarily–will operate as an Internet access provider.

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Facebook Will be ain Internet Access Platfom Enabler or Supplier

Managed Voice over Wi-Fi Should Improve ARPU, Study Suggests

It stands to reason that a voice over Wi-Fi (offload) would boost profit margins for any mobile carrier voice service, at least marginally, as the carrier benefits from a lower cost per bit profile, as access is shifted to the fixed network. A new analysis by ACG Research suggests that is the case.Looking at a business case for a developed country service provider with mature VoLTE penetration, ACG Research suggests managed Wi-Fi voice quality also helps, as it encourages users to make heavier use of voice over Wi-Fi mechanisms. The results suggest that average revenue per user is maximized when the quality of VoWi-Fi is high (resulting in increased usage) and data offload is easily available (resulting in lower cost per bit).

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Managed Voice over Wi-Fi Should Improve ARPU, Study Suggests

Telefonica Looks for Other O2 Options in United Kingdom

source: Informa It is starting to appear that regulators will not allow the proposed merger of Three and O2 in the United Kingdom, a prospect that now has Telefonica looking at other options  for its U.K. business. Among the other options conceivable in the event of a merger denial are selling to another buyer or spinning O2 off as an independent company. And some speculate that Liberty Global, owner of the Virgin Media cable TV assets in the United Kingdom, will be interested. Any successful acquisition by Liberty Global would be a further move by major cable TV operators into the core mobile services business

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Telefonica Looks for Other O2 Options in United Kingdom

20% of U.S. Households Rely Exclusively on Mobile for Internet Access

As “wireless substitution” gutted the fixed network voice business, there now are growing signs that mobile has become an effective substitute for fixed network Internet access. “ Mobile Internet service appears to be competing more directly with wired Internet connections,” says Giulia McHenry, National Telecommunications and Information Administration chief economist. Between 2013 and 2015, “the proportion of online households that relied exclusively on mobile service at home doubled between 2013 and 2015, from 10 percent to 20 percent,” she says. About 75 percent of U.S  households using the Internet at home in 2015 still used wired technologies for high-speed Internet service, including cable TV high speed access, digital subscriber line and optical fiber connections, she notes.

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20% of U.S. Households Rely Exclusively on Mobile for Internet Access

XO Integrates Skype, Salesforce into Hosted PBX Offer

XO Communications (XO) has integrated Skype for Business (formerly called Lync) as well as Salesforce into its hosted PBX (HPBX) solution, allowing phone calls to be placed directly from CRM systems and automatically accessing customer records upon call connection. The Skype for Business integration allows users to leverage seamlessly all Skype collaboration tools while connecting phone calls through the HPBX platform. The XO service now also supports multipoint video conferencing and allows customers to invite users not on the HPBX platform to participate in conferencing and collaboration sessions.

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XO Integrates Skype, Salesforce into Hosted PBX Offer

Cloud Infrastructure Growing Faster than Software as a Service

The worldwide public cloud services market is projected to grow 16.5 percent in 2016 to total $204 billion, up from $175 billion in 2015, according to Gartner, Inc. The highest growth will come from cloud system infrastructure services (infrastructure as a service [IaaS]), which is projected to grow 38.4 percent in 2016. Gartner now also includes cloud advertising in its cloud services forecast. Cloud advertising includes cloud-based services that support the selection, transaction and delivery of advertising and ad-related data. Cloud application services (SaaS) are forecast to grow 20.3 percent in 2016, to $37.7 billion

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Cloud Infrastructure Growing Faster than Software as a Service

Are OTT Video Service Churn Rates High or Low?

How one defines “churn” radically affects one’s calculation of customer churn rates. And Parks Associates counts churn at least two different ways. One method suggests low churn, the other suggests high churn. Take your pick

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Are OTT Video Service Churn Rates High or Low?

Fixed Network Now Drives Just 7% of Verizon Operating Income

If you wanted a one-sentence description of how the U.S. fixed network business has been transformed over the last 15 years, here it is: “Wireline now accounts for less than 30 percent of Verizon’s total operating revenues, down from 60 percent in 2000, and less than seven percent of our operating income,” noted Verizon Communications CEO Lowell McAdam. In the fiscal year ended December 31, 2014, Verizon generated $127.1 billion of total revenues. Fully $87.6 billion revenues, 69 percent of total, came from the mobile segment. Verizon generated $38.4 billion revenues, 30 percent of the total, from fixed networks.

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Fixed Network Now Drives Just 7% of Verizon Operating Income

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