Summary
The telecommunications industry looks vulnerable to restructuring as wireless broadband puts increased stress on the capacity and enhanced service capabilities of 3-3.5G networks while traditional revenues face erosion.
Analysis
A possible scenario would see a collapse of revenues due to cost conscious subscribers and an accelerated shift to open sourced devices, applications and services.
The outcome will depend on how rapidly new service revenues develop to replace erosion due to open access competition and defections from SMS and voice based revenues.
So far, this threat remains mostly theory: what has occurred is consolidation among better positioned competitors including VErizon and AT&T. Rather than seeing a negative impact, these operators have the market position to command access to the market-shaping devices that can be played along with their advertising and marketing programs to leverage market share gains.
But what if that is only a transition phase that will give way to more fully open access devices that leaves operators much less in control of devices, applications channels, and core service revenues?
This author consults with leading institutions through GLG
Analyses are solely the work of the authors and have not been edited or endorsed by GLG.
