Opportunities in wireless telecom

My last post talked about potential threats to traditional mobile network operator business models such as competition from new “internet” players and the device manufacturers gaining an upper hand in their relationship with operators possibly leading them to pay less attention to new operator requirements if they are in conflict with their own business objectives.  At the time, I promised that I would do a similar post looking at the opportunities for mobile network operators.  So here it is.  In fact there is a lot to discuss here – so I’ll keep this post brief and expand some of the key areas over the next few days.

Firstly, I suppose I should define “opportunity”.  By this I mean any project, the outcome of which results in a net positive cash flow into the business.  This could mean anything from developing completely new businesses or operating existing businesses more effectively. Note that I don’t use the word “efficiently” here due to connotations of reducing costs -  an existing business could be more effective at net cash generation if revenues could be increased without a similar increase in costs.

So what “opportunities” exist and more to the point, how does one evaluate the investment potential of these projects?   Well, in my mind, the opportunities fall into two broad categories – each of which have numerous potential projects:

• Increase competitiveness of existing businesses.
• Develop new services.

Increase competitiveness of existing businesses:

For voice and messaging services, the key question here is how can the mobile operator compete with new “internet” services such as Skype, Google and Facebook and new services from device manufacturers such as Apple FaceTime and Blackberry Messenger especially when these services are often offered for free to most users.  Possible options include re-thinking how the operator can offer voice and messaging services, and to whom.  Issues to consider include “freemium” business models, the role of technologies in reducing costs (and potential trade-offs between various technology options), national/regional versus worldwide focus and operational and organizational changes related to sales, marketing and engineering.  I’ll explore these in my next few posts.

For services such as mobile broadband – the question is how can the mobile operator offer internet access and how to compete against very similar offers from competitors.

Develop new services

By “new services” I’m grouping together everything that would normally be outside the scope of an operator’s traditional voice/messaging communications business.  Examples here generally relate to “machine to machine” communications whereby the mobile operator enables/improves data communication between machines used in various industry verticals. For example, a car manufacturer may wish to monitor telemetry data from cars sold around the world in order to improve the reliability of their vehicles and offer new services to their customers.  Other commonly quoted examples include logistics, mobile healthcare, security, payment and identity services. With so many potential opportunities, in many different industries, the key question here is how to scope a business opportunity and which opportunities make the most sense. Above all, what should operators be thinking about in order to ensure that they do not leave money on the table?

Let me know if you have any thoughts.  I’ll continue to develop these ideas over my next few posts. 

If you would like any advice on these issues, please contact me at chris@kcommconsult.com