Telcos need different approach to data
Telstra CEO David Thodey admitted that the telecoms industry absolutely needs to change and the future challenges are large. "But we often forget the contributions the industry has made."
He pointed out that in the two key markets it is involved in - both hyper-competitive markets - it managed to grow revenue 4-5% in Australia and 10% in Hong Kong. "That doesn't seem like a bad business to me. And more importantly, the return on capital we're deploying is pretty strong."
Hakam Kanafani, group CEO for Turk Telekom, said the mobile phone is the most popular product in the history of mankind. "It has the highest penetration compared to TV or even the internet or radio. It is a great piece of equipment, which we've done a lot to devalue."
In an afternoon session at the Mobile World Congress yesterday on business transformation for operators, moderated by TM Forum market strategist Tony Poulos, Kanafani said the industry needs to resurrect itself.
"We are not the old timers. We are not going to die. We can meet the challenges, but we have to change ourselves. We have changed the marketing and communications industry and we have changed the distribution industry. We have invested more capex to improve the infrastructure of our countries than any other industry."
But he says today the system is not working. "There is a move in telecommunications from communicating to actually doing something with that piece of equipment. This transition is being driven by the decline in the growth of subscriber," Kanafani said.
As the importance of data rises, he says "the worst thing we can do with data is destroy the value of data like we did with voice. So we must approach data differently."
Thodey said Telstra has had a big focus on simplifying its business for its customers as well as to take costs out and to differential on customer service. "But our reputation is not what it should be. Delivering good customer service -- not lip service and not just cheap prices -- is important," he said.
Kanafani insists that data makes speed the killer application. "The faster the data, the more people require data."
The industry is facing a transition that it must confront and needs to make some bold decisions. "It's been said that if telcos ran car companies, they'd only offer Fiats and Hyundais. We need to change this mentality and see what we can do in applications and vertical markets, so we can resurrect ourselves and become the young, hip, sexy, innovative companies that we are."