Telco's core revenues at risk

Telecom operators in nine developed markets face losing up to $172 billion (€126 billion) in core revenues over the next five years if they don't drastically improve their voice and messaging strategies, a new report warns.
The report from the Telco 2.0 Initiative - a group focused on driving telecom business model transformation – warns that operators face significant further declines in traditional service revenues.
The growing OTT threat, vulnerable pricing structures, economic pressures and societal changes are all putting major pressure on operators' traditional revenue streams.
But the telecom sector can reduce the expected loss by around $80 billion by intelligently optimising prices and bundles, exploiting new standards such as VoLTE, focusing more deeply on the enterprise communications segment and developing creative own-brand OTT services.
The report covers nine major developed markets - US, Canada, France, Germany, Spain, UK, Italy, Singapore, Taiwan. Depending on operators' approaches to the revenue pressures, the total service revenue decline across these markets is forecast to be between $92 billion and $172 billion.
But the report also details some steps operators are already taking to address the threat head-on. “Perhaps the most surprising thing is how effective some telco strategies have been in defending against disruptive competitors like WhatsApp,” the Telco 2.0 Initiative said in a statement.
“Equally, there are some great opportunities for telcos to build new value, particularly in the enterprise market, where some of the more traditional technology companies like Cisco face increasingly disruptive competition from players like Google and Microsoft.”