Advising you on
industry transformation
ovUm telecoms
Research Agenda
2011
RICHARD mAHoNY
Director, telecoms research & analysis
InformatIon types
telecoms at a crossroads
Analyst opinion
Benchmark
reports
telco operations
Market reports
Practice coverage of
key research themes
components
10
consumer
12
emerging markets
telco strategy
14
reports
core eXpertIse
Corporate and
Strategic Planning
Market segment
wholesale
profiles
Research
briefs
research
portfolio
studies
KeyCase
bene
ts
decIsIon maKers
Board Members
Surveys
global
telecoms
Executive
Management
Committee
Knowledge center
Vendor profiles
enterprise
network infrastructure
18
20
research store
New Product
Development and
Commercialisation
Surveys
analysis of service
Marketp
Annual
andand
five-year
customers),
and
consumer
& ent
planning
analyzer
33
Vendor
Trackers
Strategic
Planners
16
36
Ovums
database of vendor
contr
Market
Research and
Identify
required
Vendor contracts
including
Development
features
andaccess,
functiondata networking
Benchm
database
network services, optical network
Director
sets
consulting
37
Custom
VoD, voice-over-cable, VoIP
and
Marketing Director
Establish ROI
justification
Select appropriate
pricing models
22
Customer
Tracking
Marketing Manager
Brand Manager
Identify business
drivers and needs
Target pain points
Custom
Forecas
interacti
Establish minimum
acceptance criteria
contents |
Understand adoption
criteria
2011
Telecoms at a crossroads
Telcos need to
nd ways to
tap into the
emerging revenue
streams which
take advantage of
their networks
JAN DAwSoN
CHIEF TELEComS ANALYST
telecoms at a crossroaDs |
2011
LEVERAGING CUSTOMER
INSIGHTS
What separates the most successful companies from their less successful competitors
is often the ability to intuit what customers want and when. Achieving this goal requires a
combination of insights into what customers say they want and detailed analysis of customer
behavior. Telcos hold much of the data they need to make very good guesses at what
customers want, but are often poor at making sense of that data. In addition, their own
efforts to approach customers directly about their plans and preferences often fall short,
either because customers dont want to share that detail with their provider or because
telcos ask the wrong questions. A strategy that combines effective mining of the data telcos
already have with insightful analysis of customers stated preferences is key to success.
UNDERSTANDING
COMPETITORS AND PEERS
In addition to the established competitors from within the telecoms market itself, telcos face
an emerging threat from new disruptive competitors with radically different business models.
These competitors are not subject to regulation, may offer advertising-funded services for
free to end users, and may be much more dynamic and flexible than telcos can be. Holding
ground against existing competitors, while adjusting to and either working with or battling
against new competitors, is the only means to remaining profitable. In addition, learning
from peer best practice is crucial to staying ahead of the game.
2011
Understanding competitors
and peers
Consumer
DeviCes anD
platforms
emerging
markets
enterpri
ise
Network
Infrastructure
Policy and
Regulation
Telco
Operations
Telco
Strategy
Wholesale
2011
Transceive
Tra
Long dista
Lo
Components
Transceive
Tra
MediumMe
di
Transceive
Tra
Short dista
Sh
ROADMsRO
Amplifier
Am
Discretes
Dis
DARYL INNISS
PRACTICE LEADER
Transceiver 1
Long distance
Market context
Wireline and wireless network operators continue to experience
high bandwidth demand, a trend that is expected to continue
for the foreseeable future. In their efforts to improve margins,
operators need to decrease the cost of bandwidth while offering
new services. They are therefore demanding higher capacity at
smaller size, lower power consumption, and lower cost per bit.
Component suppliers provide technical innovations and new
product development that serve as key ingredients to helping
operators meet these needs.
Our coverage
Transceiver 1
Medium distance
Amplifier
Transceive
Tra
The forecast includes volumes, prices, and revenues of
Discretes
Long
dista
Lo
modules and discrete components. It represents optical
components used in the network core, metro, access, and
Transceive
Tra
enterprise-based
19%
19% networks.
17%
17%
Am
TransceiverAmplifier
1
Medium distance
17%
Transceiver 1
Short distance
Discretes
Dis
13%
23%
ROADMs
15%
13%
Amplifier
Discretes
Transceiver
Transceiver
1
1
Long distance
Long distance
ROADMsROADMs
Transceiver
Transceiver
2
2
Medium distance
Medium
distance
Transceiver 1
AmplifierAmplifier
Long distance
Transceiver
Transceiver
3
3
Transceiver 2
Short distance
Short
distance
Medium distance
Transceiver 3
Short distance
10
ROADMs
DiscretesDiscretes
Amplifier
Discretes
Datacenter transformations
driving new optical connection
demand
A host of new technologies and
approaches are being introduced in
the datacenter that require analysis
to uncover their long-term roles
and opportunities.
A short list of important questions includes
the following:
Transition to 10Gbps appears to finally
be happening. But the copper solution
is also attractive. How is this market
opportunity emerging?
40Gbps Ethernet and 100Gbps
Ethernet. Where are we, whats the
right form factor, whats needed, and
when will it all be ready?
What are optical engines, who is
developing them, and where are they
being used?
Components |
11
2011
Consumer
mICHAEL PHILPoTT
PRACTICE LEADER
Market context
Broadband Internet access has changed the way we live our lives,
the way we communicate, and the way we consume media. The
convergence of telecommunications, broadcast, and Internet
markets has created a burden of choice for consumers the
choice to consume more than ever before, anywhere, anytime,
and anyhow. Consequently, the consumers behavior, needs, and
desires are changing, and business models have to change with
them if telcos, vendors, and online service providers are to capture
the value resulting from the consumers new demands.
Integrated services
Advertising
Extended home
Digital media
Our coverage
12
Integrated value-added
services
Much focus today is on the high-end
content services. However, there are
Opportunities in the
connected and extended home
Content and value-added services are a
big part of the connected and extended
home. However, there is more to the
connected home than just content. The
home network, CPE evolution, connected
device developments & adoption, and
e-services all contribute to the wider topic.
Working with other research teams within
Ovum and Datamonitor, the Consumer
team will look to pull together all aspects
of the topic with an emphasis on the B2C
opportunities for service providers.
Social media
Social networking is one of the most
mature and popular of all Internet
applications. Its familiarity, even within the
mass market, means that it is becoming
an increasingly important tool within other
types of media and communication. Ovum
will analyze how social networking can
be utilized in other applications and how
players can monetize such innovation.
Research will focus on case studies
of leading players and the associated
business models.
Consumer |
13
2011
ADAm LEACH
PRACTICE LEADER
Market context
Connected devices, whether mobile phones, tablets, set-top
boxes, games consoles, PCs, or others, form the focal point for
the delivery and consumption of telecoms and Internet services,
content, and applications.
However, the core value in these devices lies less and less in the
physical device itself and more and more in the software platforms
that run on these devices.
A number of major industry players are competing for market share
in this space including Apple, Google, Microsoft, Nokia, RIM,
and Samsung for dominance in the home and personal device
markets.
Our coverage
The Devices and Platforms practice addresses the key competitive
dynamics in this space by analyzing the major players and their
strategies, the threats and opportunities presented to existing
players, as well as future impacts.
We provide player analysis, forecasts, and tracking of
specific device types and platforms to help operators, device
manufacturers, platform vendors, enterprises, and application
developers make sense of this rapidly changing market.
samsung
htc
lg
DEVICES
sony ericsson
motorola
14
android
RIM
Nokia
PLATFORMS
Apple
windows Phone
Adjacent players:
opportunities and threats for
telcos
Telecoms operators face significant
competition from other telcos and
cable companies, but they are increasingly
having to battle against disruptive
competitors coming from adjacent industries,
most notably online service providers and
consumer electronics vendors.
These players represent a significant
threat to telcos, as they often bring
Opportunities in the
connected and extended home
The range of devices which are
connected is now extending far beyond
home computers and mobile phones.
Games consoles, tablet computers and
netbooks, connected televisions and
set-top boxes, plus other devices such as
in-car systems often driven by the same
technologies that underlie smartphones
are increasingly connected not only to the
Internet but also to each other.
We will be revisiting the concept of the
connected and extended home during
2011. We will examine how the platforms
and technologies deployed on these
devices can both help and hinder telcos
and other players in their attempts to gain
control in this important space.
15
2011
Emerging markets
ANGEL DoBARDZIEv
PRACTICE LEADER
Market context
Growth in the mature markets of Asia, Europe, and North America
has slowed amid market saturation in many service areas. As a
result, many service providers and equipment vendors continue
to look at the emerging economies of Africa, Asia, Eastern
Europe, the Middle East, and South and Central America for
customer and revenue growth. In such geographies, large
swathes of the population are either un-served, or have very basic
communications services.
Our coverage
The Emerging Markets practice highlights the key product and
geographic growth opportunities in the growth economies and
provides deep insight on the emerging players and markets we
evaluate. In doing so, our central focus is on distilling the best
practice strategies that will assist service providers and vendors
to succeed and prosper in what are often unique and challenging
market environments.
16
Emerging Asia
Coverage
anchored
around China,
India, Malaysia,
Indonesia,
Thailand, and
Vietnam
Communications technology
direction and adoption in the
emerging markets
Emerging Markets |
17
2011
Enterprise
EvAN KIRCHHEImER
PRACTICE LEADER
Market context
Our coverage
ve r s
s
eed
S up
Enterprise
communications
te new mar k
s tomer n
rs
As
et s
G ro w
s cu
ses
Bu
en
ue
an
dm
ar g
der
in
t
s t a n d yo u r s t r e n g
an d w
e ak ne s s e s
hs
r
Suppo
er
v
rev
Us e r s
Un
les
t sa
ul a
itio
rs
18
pr
alua
Stim
rs
Ev
l ie
co m p e tito
ve
os
ck
Tr a
Evo
l
ice
del
iver
dr i
te
et
rk
op
ye
&
enterPrise |
19
2011
Network Infrastructure
DANA CooPERSoN
PRACTICE LEADER
Market context
Our coverage
The Network Infrastructure practice provides vendor, financial,
and network operator customers with a comprehensive view
of the trends including architecture, technology, and product
evolution; shifts in buyer requirements; and spending shifts that
affect critical business strategies as networks evolve to support
operators twin goals of cost reduction and new revenue growth.
Our experienced team builds on a data foundation compiled over
almost two decades. We offer solid research and logical analysis
to provide customers with critical guidance so they can step away
from the crossroads, confident that theyre headed in the right
direction.
rk
regulatory
obligations
Fix
e d Ne t wor k s
Disruptive
customers
Ne t wo
Diverse
customer
needs and
expectations
new service
requirements
20
b ile
Disruptive
technology
investment
environment
Networks as enablers of
globalization: supporting
emerging vs. developed
markets
Over the past five to 10 years there
has been a dramatic shift in the size
and growth of network infrastructure
Network Infrastructure |
21
2011
mATTHEw HowETT
LEAD ANALYST
Market context
Our coverage
Ovums Regulation research provides you with a deep
understanding of the impact of regulatory issues that shape the
future of the telecoms marketplace and the effect these have on
strategies and revenues. Our Regulation research and analysis
team has a global track record of providing policy and regulatory
advice in telecommunications. Our experts follow the worlds key
market regulatory developments and assess their relevance at a
regional and local level. We undertake quarterly benchmarking,
country profiling, and cross-country regulatory analysis.
22
Regulatory scorecard
From 2011, Ovum will develop an annual regulatory
scorecard to benchmark the telecoms regulatory
framework in a number of best practice countries
around the world to compare the cost and effectiveness
of regulatory activity. It will be produced in consultation
with NRAs and telecoms operators and compare the
institutional and legislative environment affecting the sector
as well as the application of regulation by NRAs in key
wholesale access and retail markets.
Spectrum policy
Spectrum is a finite resource which must
be allocated and managed appropriately.
Significant amounts of spectrum will
become available over the next 12
months as operators look to launch
next-generation mobile networks. How
regulators award this spectrum and what
obligations they place on license holders
are key regulatory issues.
Interconnect
For many operators, interconnect has
traditionally accounted for a sizeable
proportion of revenues. However, the use
of standardized costing methodologies
looks set to exacerbate the already
downward trend in mobile termination
rates, and some NRAs will be considering
what alternative charging principles
could be used once rates fall to fixed call
termination levels.
Our core tracking of interconnect will
be through our quarterly interconnect
benchmarking. We will add new countries
and regions over the course of the year
to ensure a robust set of data exists from
which international comparisons can be
made.
Aside from the actual charges, we will
also look in depth at how the rates were
determined by the NRA and steps that
are being taken to reduce and harmonize
termination rates between countries. We
will also focus on what future charging
principles such as bill and keep might look
like once the current regimes expire.
23
2011
Telco operations
CLARE mCCARTHY
LEAD ANALYST
Market context
The telco business has changed dramatically over the last five
years. Previously, technology reigned supreme, but now the
customer is the focus of all activities. With cheap credit and
debt no longer available, telcos need realistic business cases to
justify heavily scrutinized investment decisions. This has called
for a comprehensive review of how telcos operate and requires
the consolidation and rationalization of people, platforms, and
processes. The resulting lean and cost efficient infrastructure
should help fixed, mobile, and integrated operators respond more
quickly to market and customer demands.
Our coverage
Many tier-1 operators in mature markets are addressing these
issues, but it is likely to be a work in progress for most telcos over
the next 10 years. The Telco Operations practice reviews telcos
operational and transformation strategies and how these strategies
are implemented internally. We identify the current challenges and
areas of business pain, the future business objectives, and activities
required to achieve those objectives.
customer satisfaction
flexibility of business
time to market
network ef ciency
sustainability
24
Customer experience
In these highly competitive times, a
good customer experience is essential
to keeping customers satisfied and loyal.
Most customers form their opinion of the
service they receive from the telcos front
line call centers for customer service and
technical support, or through their direct
Customer centricity
Lack of customer focus is one of the
root causes of failure in the customer
experience. It sounds obvious, but it is
only now that we see telcos revisiting their
product development and management
process and putting the customer at the
center of process. This process can draw
on the databases holding information on
the customer, product, usage, pricing data
and so forth, but to date, telcos have been
incredibly bad at organizing that data for
commercial gain.
Telco Operations |
25
8,000,000
Connections (000s)
Telco Strategy
7,000,000
Connections (000s)
2011
9,000,000
6,000,000
9,000,000
5,000,000
8,000,000
4,000,000
7,000,000
3,000,000
6,000,000
2,000,000
5,000,000
1,000,000
4,000,000
0
2008
3,000,000
2009
2010
2011
2012
2013
2014
2015
2,000,000
1,000,000
0
2008
2009
2010
2011
2012
2013
2014
2015
JEREmY GREEN
PRACTICE LEADER
9,000,000
8,000,000
Our coverage
Ovums Telecoms Strategy practice provides a perspective
across the entire fixed, mobile, and integrated communications
marketplace, offering a converged view of the future. Our remit is
to provide clients with insight, across the strategic horizon, into the
strategic challenges facing operators; how we see these market
forces evolving; and our advice to operators on how they should
respond.
Connections (000s)
Connections (000s)
9,000,000
6,000,000
8,000,000
5,000,000
7,000,000
6,000,000
3,000,000
5,000,000
1,000,000
0
2008
2009
2010
2011
2012
2013
2014
2015
2015
7,000,000
8,000,000
Connections (000s)
7,000,000
Connections (000s)
Market context
6,000,000
7,000,000
5,000,000
6,000,000
4,000,000
5,000,000
3,000,000
4,000,000
2,000,000
3,000,000
1,000,000
2,000,000
0
1,000,000
2008
0
2008
2009
2009
2010
2010
2011
2011
2G GSM
2G GSM
HSPA
HSPA
CDMA2000 1XRTT
CDMA2000 1XRTT
WCDMA
WCDMA
26
2012
2013
2012
2013
2014
2014
2015
2015
LTE
LTE
CDMA 1XEV-DO
CDMA 1XEV-DO
Mobile WIMAX
Mobile WIMAX
Telco Strategy |
27
2011
wholesale
BT, 18.1%
Others, 27.2%
France Telecom,
16.2%
Swisscom, 2.5%
Verizon,
2.5%
DAvID
JAmES
TeliaSonera,
LEAD ANALYST2.6%
AT&T, 3.1%
KPN, 4.4%
Market context
Telefonica, 7.3%
Our coverage
While telecoms service providers across the globe now accept that
providing services on a wholesale basis can be a valuable channel
to market, in the face of increasing competition in the wholesale
market they need to understand how to differentiate themselves
from their competitors. Ovums Wholesale research and analysis
helps players understand and respond to their competitors
strategies, their customers changing needs, and the changing
18.1%
27.2%
18.1%
2.5%
2.5%
2.6%
2.5%
2.5%
3.1%
2.6%
16.2%
8.0%
4.4%
3.1%
BT
4.4%
7.3% 7.9%
8.0%
7.9%
7.3%
BT
Telefonica
France Telecom
KPN
Telecom Italia
AT&T
Deutsche Telekom
France
Telecom
28
16.2%
27.2%
Telecom Italia
Verizon
Swisscom
Telefonica
Ver
KPN
Sw
AT&T
Oth
Others
TeliaSonera
Value-added wholesale
services
Wholesale is no longer limited to the
sale of long-distance capacity and voice
minutes to intermediaries. Wholesalers
are moving up the value chain to offer
increasingly sophisticated service
bundles, tailored to particular customers
Developing wholesale
business models
Players in the wholesale market are
following a variety of different business
models. Some carriers have integrated
their domestic and international wholesale
businesses; others keep them separate.
Some wholesalers have decided to limit
their portfolios to commodity services
(such as voice, transit, and bandwidth);
others offer broad portfolios of increasingly
complex services and service bundles.
In 2011, we will analyze the different
business models being followed in
Wholesale |
29
2011
Research Portfolio
Information Types
Reports
30
Analyst opinion
Short event-, news-, or trend-driven premium analysis from our global analyst
team.
Benchmark
reports
Assessments of operator and vendor strengths relative to their peer group and
competitors.
Market reports
Market segment
profiles
Deep dives on optical networking segments, for example metro WDM, DWDM
backbone, aggregation, and bandwidth management, plus application segments
including carrier Ethernet and converged packet optical (CPO).
Research briefs
Short reports and articles analyzing market events, industry trends, and vendor
news.
Case studies
Surveys
Trackers
Vendor profiles
Vendor contracts
database
Information Types
Market share
reporting
Quarterly market share reporting on the broadband access (DSL, CMTS, FTTx),
optical components, optical networks, switching and routing, and vendor services
markets.
Quarterly tracking of operator financials, contracts and deals, including
Quarterly
industry
results
tracking
Interactive
models
Research Portfolio |
31
2011
Key Benefits
CORE EXPERTISE
Corporate and
Strategic Planning
DECISION MAKERS
Board Members
Executive
Management
Committee
Strategic Planners
Market reports
Forecasting reports/
interactive models
Understand market
dynamics and needs
Size, prioritize,
and target market
opportunities
New Product
Development and
Commercialization
Research and
Development Director
Marketing Director
KNOWLEDGE CENTER
TOOLS
Identify required
features and function
sets
Establish ROI
justification
Vendor Matrix
BENEFIT/ROI
Make more effective
strategic and
business decisions,
faster
Market segment
profiles
Financial deals tracker
Market reports
Benchmark reports
Customer surveys
Accelerate delivery
of profitable revenue
streams
Select appropriate
pricing models
Establish cost and
timing of market entry
Customer Tracking
Marketing Manager
Brand Manager
Identify business
drivers and needs
Target pain points
Customer surveys
Forecasting reports/
interactive models
Establish minimum
acceptance criteria
Enhance customer
proposition and
improve customer
targeting
Understand adoption
criteria
Competitor Tracking
Chief Information
Director
Market Research
Identify competitors
sales, product,
messaging, and
channel strategy
Understand strengths
and weaknesses
Understand the
perception of
competitors
32
| Key Benefits
Market reports
Benchmark reports
Profiles and case
studies
Analyst opinion
Research briefs
Maintain or obtain
competitive
advantage
2011
Contact enquiries@ovum.com
to start using now
33
2011
Knowledge Center
34
Customizable My
Home page
Contact demo@ovum.com to
book your free training session
KnowleDge center |
35
2011
Research Store
36
| research store
2011
Consulting
FAST
SmART
ACCuRATE
Objective opinion
leadership is a mainstay of
what youll get from Ovum
Consulting. However, our
opinions will always be
based on robust research,
enabling us to deliver
fact-based and pragmatic
solutions to our clients.
consulting |
37
TM
www.ovum.com
enquiries@ovum.com
London
Durban
Dubai
Hyderabad
Hong Kong
Beijing
Shanghai
Seoul
Tokyo
Sydney
Silicon Valley
New York
So Paulo