Revenue Generation For Information and Communications Technology Companies
Communications Service Providers (CSPs) Monetize Services
Take It With You
In response to the realities of their marketplace, CSPs have made tremendous efforts in recent years to reduce operating expenses in their networks and in their organizations. Those efficiency efforts will continue, but service providers are now looking beyond cost reduction to confront a market that offers both tough competition and promising new revenue opportunities.
Change is the one constant of the ICT marketplace. Cable companies are moving into telephony services, cities are deploying WiMAx/WiFi networks, CSPs are rushing to deploy their own version of the triple/quadruple play, and customers are eager to try and buy an exciting new menu of data services such as video on demand and gaming.
Companies that can give consumers the services they want, when and where they want them, and at a competitive price, will reap the rewards of this converged communications landscape. CSPs are poised to invest billions in new technologies – such as 3G, fiber-to-the-curb, fiber-to-the-premise, Next Generation Networks and more – to position themselves to exploit this enormous market opportunity.
“According to In-Stat, the 1.9 million U.S. homes passed by FTTP in 2004 will increase to 11.8m by 2009. Assuming revenues of $20 per month, this represents an addressable end user market of $2.8B per year. The total number of homes in the United States is 110m; this represents a total addressable end user market of $26.4B per year.” (Telephony, April 27, 2005)
“The Americas and Europe will ... lead the world in mobile gaming ... U.S. Mobile gaming revenue is expected to reach $1.79B by 2009 with a CAGR of 54 percent over the years 2004 to 2009.” (2005 Mobile Games White Paper, International Game Developers Association, June 2005)
CSPs can claim their share of this more complex, data-oriented communications marketplace. But to do so, they must be able to create and go to market with new services in weeks, not in months. They must develop the systems and processes that create and encourage a true “customer first” culture. CSPs must work to transform themselves, often through close alliances with technical and business partners, into more agile and responsive organizations.
Finally, and most importantly, CSPs must adopt a logical, workable and proven way to monetize these next-generation services.