The telecommunications industry is struggling to keep up with the challenges of an ever-changing market driven by cut-throat competition and consolidations. These challenges are the result of extreme price wars for traditional telecommunication products at the same time that pressure to invest in infrastructure, new technologies, products and services rises.
This is further complicated by the appearance of new market participants with innovative technologies and new business models, which themselves are changing the structure of the telecommunications market. Not only are they establishing new business models that traditional market participants are hesitant to participate in, they are also attacking and changing the existing telecommunications industry.
Key signs of this transition are declining average-revenues-per-user (or ARPU) for traditional telecommunication products and clear growth in new business fields, such as over-the-top (OTT), voice-over-IP (VoIP) and machine-to-machine (M2M).
Traditional telecommunication providers must figure out how to respond in order to retain direct customer contact, as well as to translate it into new business models. New providers, in turn, must ask themselves how they will continue to secure access to the high-quality networks they use as the basis for their value-added services.
The challenges can be divided into three main areas:
