80% Of Telecom Carriers Will Fail To Transform Into Content Enablers

Traditional telecom carriers can no longer rely on conventional competitive tactics such as price cuts, promotions and basic product bundling to maintain their edge in the consumer segment, warned Gartner. According to Gartner analysts, non-traditional telecom players like Apple, Google and Nokia are adopting new business models that are forcing carriers to reassess their approach and service delivery. Faced with this competition, traditional telecom carriers will attempt to transform themselves by primarily exploiting content, but Gartner predicts that more than 80% will fail.

“The players that will be among the successful 20% will be the ones that provide a consumer-centric experience, for example through interactive TV, where users will be able to chat online while watching their favourite TV programmes,” said Martin Gutberlet, research vice-president.

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Owning infrastructure initially gives telecom carriers some competitive edge but this is mitigated by non-traditional competitors that don’t own a network but bundle their services attractively. “As demonstrated by Apple and Google, three new attributes are coming into play and driving change in the marketplace that the traditional telecom players must embrace to become successful content enablers, which create and/or deliver content. They are trust, usability and an exciting customer experience,” said Gutberlet.

In this changing landscape, the winners will be those companies that understand consumers’ needs, focusing on usability and actually giving control back to the users. The losers will be the ones that focus on overly technical product differentiation that the majority of consumers will not understand and therefore not use.