Operators to suffer $14bn in lost revenues this year

A new report from Juniper Research has claimed that voice and messaging traffic lost to OTT (Over The Top) players such as WhatsApp, Facebook and Skype will cost network operators $14 billion in revenues globally this year, up by 26% on 2013.

The report – Mobile Operator Business Models: Challenges, Opportunities & Strategies 2014-2019 – found that in a number of markets, including Italy, Spain and the UK, operator mobile voice revenues had fallen to less than 60% of their value five years’ ago. It argued that a combination of IM, VoIP and social media substitution was primarily responsible, resulting not only in lost revenues but in additional costs due to the scale of signalling traffic.

However, the report also identifies an array of new revenue streams with the potential to deliver cumulative revenues to operators in excess of $66 billion over the next five years. The resulting revenues could more than offset the decline from core service revenues on an annual basis by 2018.

According to report author Dr Windsor Holden, “In areas such as M2M (Machine to Machine) and mobile money, operators can achieve a substantial revenue uplift by focussing on full service provision rather than simple connectivity”.

Additionally, the report recommended that operators implement direct carrier billing to retain a foothold in the lucrative mobile content space, and that they enhance their analytics packages to monetise consumer ‘Big Data’.

The report adds that without optimisation, mobile data delivery costs will increase by more than three times over the next three years. It says implementation of NFV (Network Functionality Virtualisation) solutions offer operators the potential both of cost savings on proprietary hardware and on reducing product time-to-market. In addition, operators can boost core revenues by introducing higher-value shared data plans or by bundling content into a monthly subscription.

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