The future for many European operators is to realise the need to transform themselves into smart pipes. However, this will require significant courage on behalf of the management to accept such a radical change, and then provide sufficient oxygen to give the smart-pipe strategy room to breathe.
The accepted definition of a smart pipe--a term not liked by all--is for the operator to become a B2B2C player instead of simply being a B2B player. This will involve monetising certain capabilities within the pipe by selling access to technologies such as billing and location to third parties.
Of perhaps more importance is the implementation of intelligent access pricing, requiring the development of a deeper understanding of what traffic is passing through the network.
Based on this understanding, the operator can then develop sophisticated pricing models for access to the network. For example, many operators are investing in deep packet inspection and policy control, and if this technology is used intelligently, there should be a possibility of connecting different devices and charging for access on a more segmented basis.
We could then see operators pricing access by device type instead of charging on a per-megabyte basis.
Becoming a smart pipe also calls for the operator to accept that third party service providers are their partners, particularly ISPs, and not their rivals--as is often the case today.
This means acknowledging that third parties can sometimes provide a better and more attractive consumer-based proposition than the operator is able to achieve. Therefore, the challenge is for the operator to do everything it can to make these external service providers successful on their networks, rather than creating difficulties for them.