M&A analyst: Facebook IPO spells trouble for operators

Facebook's increasing dominance of the social networking market will damage mobile operators' sales from services such as text messaging, according to a study from M&A consultancy Magister Advisors. Facebook's over-the-top business model creates significant strategic and revenue risks for mobile operators, claims the firm, and is turning mobile operators into "digital drug mules," supporting a burgeoning global habit with little financial benefit. As the company prepares to public, and gets pressure form investors to turn profits, it will damage operators further, according to Magister. "Facebook's IPO is about the worst thing that could happen to network operators," said Victor Basta, managing director of Magister Advisors. "They're supporting the end users' social networking habits, but they see very little, if any, commercial benefit and the downside risks are significant." Article

Suggested Articles

Wireless operators can provide 5G services with spectrum bands both above and below 6 GHz—but that doesn't mean that all countries will let them.

Here are the stories we’re tracking today.

The 5G Mobile Network Architecture research project will implement two 5G use cases in real-world test beds.