FOR SERVICE PROVIDERS, it is the best of times—and it is the worst of times. On the one hand, the promise of next-generation data, mobile and video services is now a reality: Today’s telcos are true multimedia communications giants, offering voice, data, wireless and video services to meet the demands of an increasingly digital society seeking to harness the power of convergence across all facets of their lives. “The telecom sector could look back on [2009] as one of those historic inflection points that defined the future of the industry—a future that is data- and services-driven, not voice-based,” contends audit, consulting, financial advisory, risk management and tax services firm Deloitte, adding the shift will require service operators to transform their strategies and operations to support and leverage advances such as the evolution from wireline voice to video communications, media-driven entertainment, wireless connectivity across vertical markets and an expanding global footprint.
Enthusiasm for the next generation of communications services is nevertheless tempered by grave concerns for the health of the global economy. By most expert accounts, the world is mired in its deepest financial downturn in more than 60 years. Speaking at a Peterson Institute for International Economics conference in early April 2009, former International Monetary Fund chief economist Michael Mussa said he anticipates a 0.8 percent contraction in the world economy this year, with output declines of 2 percent in the United States, 5 percent in Japan and 2. 5 percent in Western Europe. But Mussa also anticipates that the economy will remain true to historical trends, following a steep downturn in growth with a dramatic upturn, a recovery often referred to as “V-shaped” due to its appearance on a graph. “When [the economic rebound] starts, I think it is far more likely than not that the U.S. economy and the world economy will see the ‘V’ for victory,” Mussa said.
For communications service providers in the midst of transforming their businesses from the wireline voice solutions of the past to the next-generation networks of the future, the economic downturn could not have come at a more problematic time. While maintaining consistently superior services, technologies, operations and customer care experiences are paramount challenges for providers in any competitive environment, the recession poses a host of additional complexities, forcing operators to balance capital expenditures and spending strategies with the bleak realities of an economy in freefall.
Just because the economy is in trouble doesn’t mean service providers can halt the evolution of their business, however—in fact, operators can more effectively navigate economic turmoil by introducing new solutions and technologies that both strengthen and streamline their operational structure. “The question facing service providers is how to increase ARPU around all platforms,” says Vince Vittore, principal analyst in Yankee Group’s Anywhere Network research group. “If you don’t introduce next-generation services, you’re in danger of being nothing more than a bit-pipe provider. That means big trouble if you’re a telco.”
THE PROMISE OF NEXT-GENERATION DATA, MOBILE AND VIDEO SERVICES IS NOW A REALITY: TODAY’S TELCOS ARE TRUE MULTIMEDIA COMMUNICATIONS GIANTS.
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