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Telco 2020 – How Telcos transform for the "Smartphone Society"

2012

A battle of giants is brewing in the world of telecommunications. Traditional telcos, with their five billion customers worldwide, are getting ready to take on new Internet-focused rivals offering communication platforms, services and content via smartphones, tablets and Internet-enabled TVs. Right now, the strongest of these are the "fab(ulous) five": Amazon, Apple, Facebook, Google and Microsoft, who serve over three billion customers between them. Traditional telcos and their modern rivals each have a total market capitalization of round about EUR 800 billion. Current public opinion favors the fab five with their superior innovative capabilities, breathtaking growth rates and large cash reserves. But will that be enough to threaten the traditional telcos?

The fab five certainly enjoy a number of advantages, including daily "branded contact" with customers, close customer bonds with their easy-to-use, personalized service ecosystems and, increasingly, a willingness on the part of customers to pay for such services. Pureplay broadband access – the mainstay of traditional telcos' business today – will remain the cornerstone of digital communication in the future for both landlines and mobile communication. While usage and associated data volumes continue to grow exponentially , however, telcos are under the price pressure that inevitably accompanies commoditization while the industry so far has failed to monetize volume growth.

So what can telcos do in their battle with the giants? This is the question answered by our global study "Telco 2020 – How telcos transform for the Smartphone Society".

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