Consumer Ubiquity: Allowing Asian Operators to Go Anywhere

2008 is the Year of the Rat according to the Chinese Zodiac. It is the first of 12 signs in a 12-year cycle, signaling a new beginning. Within this context, it may be appropriate for mobile operators to consider a new beginning as well.

For the past decade, the telecom industry essentially has focused on two things:

• Organic growth via network expansion and the introduction of cheaper handsets
• Expanding the pipe primarily through the introduction of new technology and upgrades

But returns have been incremental—with each new generation of technology struggling to differentiate itself not only from the last, but also from new networks being built by competitors. Looking at things from a revenue perspective, the question begs to be asked: What is 3G other than a more efficient platform to carry voice and ringtones?

The game is over for the vendor community (at least on the network side), as both turnover and profits decline massively. Merger activity will undoubtedly continue through 2008. So what is left for operators to look at? Judging from the media, the answer seems to be in handsets. Google (Android), Apple (iPhone) and Nokia (Ovi) all have made significant announcements that were received both positively and negatively by carriers globally.

However, operators have a great competitive advantage to leverage: They enjoy a service/product/platform that is virtually ubiquitous. Yes, the network is ubiquitous, but so is their business. Nokia’s increasing presence in both handsets and now services is an example of this.

The combination of vast distribution networks, easily recognizable brands and strong and steady cash flows hints at tremendous potential for revenue growth—and also leads carriers to squander revenue on marketing expenses and faster networks. We are starting to see a change—albeit small—in how operators are thinking about their business within this context. Those that change corporate structure fastest to leverage first-mover advantage will be the winners.

In this Yankee Group Report, we aim to help operators grapple with the direction of the mobile market in the next 3 to 5 years and how they should best position themselves to minimize the disintermediation and the risks they face from new technologies and business models.

I. All Show and No Grow

Buzz-Makers Abound

Internet: Mobile but Miniscule

Overestimating the Opportunity in the Short Term

II. Ubiquity: The Path to Anywhere

From Operators to Business Aggregator-Integrators

M-Commerce : A New Beginning

Anywhereness: When the Platform Becomes the Product

III. Recommendations

Recommendations for Operators

IV. Further Reading