Informa Telecoms & Media has revealed its Top 10 trends for 2011 for the telecoms and media sectors at its annual Industry Outlook event in London.
Speaking at the event Mark Newman, Informa Telecoms & Media’s Chief Research Officer, comments: “2010 has, on the whole, been a good year for the telecoms industry. Operators have bounced back from the economic downturn and produced solid financial results. Infrastructure vendors have also had a reasonable year with contracts for next-generation networks starting to come through and a strong shift into services to support operators’ broadband network rollouts. Handset vendors have moved quickly to embrace the emergence of a mass market for smartphones.”
“We have identified the top 10 key trends across our research areas that we think will shape the converging global telecoms and media markets over the next 12 months. In addition, our annual industry survey gave us some insight into how the industry feels about the issues most likely to dominate the landscape in 2011 – these include the emergence of new vertical enterprise sectors such as healthcare, utilities and transportation, the mobile internet as a mass market, and the importance of strategic partnerships with Internet players,” said Newman.
Top 10 trends for 2011:
1. Operators need to choose a smartphone platform strategy – The popularity of Android and iPhone devices has led mobile operators, developers and handset manufacturers alike to re-focus on the smartphone platform. Operators are trying to decide whether to build their own platforms or accept that the Internet and OS players will dominate. The outcome of this decision will determine who the winners and losers are in the battle to derive maximum value from the development and penetration of the smartphone platform.
2. Democratisation of smartphones – In 2010, we have seen smartphone adoption in the lower price tiers as mobile operators look to grow data revenues from a broader user base, and we expect this trend to accelerate in 2011. The drive by some vendors to reduce the cost of smartphones opens up a whole new opportunity to create devices for the mass market, a strategy that is welcomed by the mobile operators. Informa Telecoms & Media expects 342 million smartphones to be sold worldwide in 2011 equating to 27% of total handsets sold.
3. Strategic partnerships between operators and Internet players – The most successful mobile operators will be the ones who can form strategic partnerships with key Internet players, and not the ones who want to pull up the drawbridge and block these companies from accessing their customers. While operators look to develop these relationships, intriguingly they too are being forced to become more conciliatory in the way that they work with each other.
4. Operators to focus on vertical markets – Operators have been talking about the potential of mobile enterprise for many years but the difference this time around is that their starting point is machine-to-machine communications rather than voice and SMS. The focus of operators today is the healthcare sector where they are still in the early stages of learning where the best opportunities lie. They will need to do the same for each and every vertical sector to decide where to position themselves to develop profitable businesses.
5. Web 2.0 will provide opportunities for growth – Mobile operators have an opportunity to harness IM and social networking in order to increase the stickiness of their traditional messaging services, and to generate additional traffic and revenues from these services. To achieve this, mobile operators need to maintain a primary role in how their subscribers access IM and MSN. For many operators, this means implementing network-based address book services, which will be the starting point for all of their subscribers’ mobile communications.
6. Telecoms operators need to catch up in the superfast broadband race – For the most part, the real winners in the superfast broadband race have been cable operators – telecoms operators must do something about this in 2011. Those that have rolled out fiber need to be more aggressive in their efforts to convince consumers and service providers to move to their new networks. Low prices and attractive bundles, rather than superfast speeds, will be vital. Consequently, operators will rekindle their interest in investing in low-cost VDSL, both from the street cabinet and the local exchange
7. The battle for the connected home heats up – 2011 will see TVs overtake games consoles as the dominant in-home connected device, at least in terms of units sold, but this does not mean people will actually use the online services. By the end of the year, we will be much closer to knowing whether Google TV, Apple TV, Canvas and HbbTV are game-changers or simply another case of the Emperor’s New Clothes.
8. Cable TV declines in Western Europe -Operators are not just struggling to cope with converting European cable homes from analog to digital, they are competing to upsell their subscribers to bundled packages, especially triple-play (TV, broadband and telephony) and even quad-play (triple-play plus mobile) service bundles.Our forecasts predict that the number of Western European TV homes taking cable will fall from 51 million in 2006 to 48 million in 2015 – or from 31% of households to 26%.
9. LTE spectrum fragmentation will undermine its global potential – LTE’s inherent adaptability, the very feature which has helped it gain global acceptance, may actually come to undermine its global potential. The failure to identify globally harmonized spectrum for next-generation “4G” services means that, in order to meet the demands of a diverse range of frequency allocations, LTE is being required to provide operators with multiple options in terms of channel size and spectrum band, as well as a choice between FDD and TDD modes.
10. Network rationalisation continues – Regardless of market dynamics – be it “mature” Western Europe or “emerging” Africa – 2010 has been a year of network rationalization and 2011 looks to be no different. As it becomes unsustainable for minor carriers to roll out networks, market consolidation will follow, and so too will network rationalization. We expect to see similar instances of network sharing in Africa, especially as carriers come under increasing pressure to universalize their networks and reach the underserved.