Anger Over Ofcom Ruling

Mobile network operators have expressed anger over new proposals that could force them to pay more than four times the current amount to use the radio spectrum. Ofcom has justified the new licensing fees, claiming that they reflect market value based on other European countries. Ofcom’s proposed 4G licensing price increases are over 432 percent for Vodafone and O2, and more than 330 percent for EE and Three.

Earlier this week, it was also reported that European operators are growing increasingly concerned about their 4G rollouts and their current return on investment.

Andy Huckridge, director of service provider solutions at Gigamon, a global provider of intelligent Traffic Visibility solutions for enterprises, data centres and service providers, has made the following comments:

“It’s not surprising that talk has suddenly turned to ROI – with significant 4G investments already made by many of the leading operators and rollouts continuing across the country. Carriers are already facing a difficult balancing act between implementing tools to manage increased data volumes, while keeping Annual Revenue Per User (ARPU) up and churn rates down – so it’s natural that these proposals have hit a raw nerve.

“If managed correctly, 4G LTE can present a great opportunity for carriers to create new revenue streams and profit from the increasing demand for content and applications that the technology promises. However, this calls for a certain level of network planning and subscriber intelligence to do so – and many carriers unfortunately overlook existing blind spots in the haste to sign up new 4G customers or rollout bigger networks than their competitors. By implementing pervasive visibility tools, operators can take time to fully understand the drivers of traffic – whether it be applications, devices or subscriber behaviour – in order to make better business decisions and optimise the design of their existing networks.

“With the right tools, carriers can correlate and characterise customer, application and operational data – helping them move away from the universal, flat rate pricing plans of the past, toward a model that can prove profitable more quickly. Such deep subscriber intelligence will also enable the creation of tailored portfolios and pricing strategies based on usage patterns and premium level content.

“Essentially, with such stress on operators to innovate while remaining profitable in a hugely competitive space, improving network visibility is rapidly emerging as the most viable solution. Only through increased visibility will operators be able to improve on current business models – and, more importantly, existing expense structure – while running the big data services of tomorrow, on the networks of tomorrow.”

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David Dungay

Editor - Comms Business Magazine

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