Operator Agility Key to Future Business Model

Operators will be able to expand into new areas as connected devices become increasingly central to people’s lives – but they need to be agile in order to exploit these opportunities, warns Telefonica Digital director of global partners and devices, Steve Alder.

Alder, who spoke in the ‘Consumer Devices: Riding the Next Wave of Smart Devices’ session at MWC Congress today, said operators will increasingly be able to become involved in new value chains, such as financial services, eHealth or cloud computing.

“As operators we have a key asset in terms of the relationship with the customer (both from a billing perspective and in terms of brand trust) and we need to make the most of this relationship to unlock the revenue opportunities presented by new digital services,” Alder said.

The main challenge associated with these new revenue opportunities is keeping up with technological developments. “If we don’t keep up with the pace of innovation we will quickly lose relevance to the customer and then ultimately our place in the value chain,” Alder said.

Operators are already becoming marginalised by other technology players with over-the-top services such as Viber and WhatsApp, which target core elements of operators’ businesses. With barriers to entry so low for other players, operators need to be “much more nimble and agile to stay relevant,” according to Alder.

Telefonica Digital was set up with the aim of achieving rapid innovation and has an open approach to partnerships with everything from start-ups to global handset makers. “We recognise that innovation can come from anywhere and we need to embrace it and work with it when we see it,” Alder said.

He added that operators need to embrace opportunities presented by internet technologies if they are to “out-innovate” online and app developers. “Telcos need to realise that there are no longer any sacred cows in this space and everything is potentially up for grabs,” he said.

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