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"AT&T Watch" and "Terminal Decline"

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It is not always so obvious why new services such as AT&T Watch, a $15-a-month streaming service, is so fundamental for mobile operators and retail- and consumer-focused telecom service providers.

The  fundamental problem is that the core business model--connectivity services--is incapable of driving future revenue growth. In fact, we are likely to see an actual erosion of such revenue in developed and developing markets, sometime within the next five to 10 years.

Terminal decline is the phrase the Economist Intelligence Unit uses to describe the fixed network telecom business. Harsh words, perhaps, but instructive if one honestly has to assess the direction of public policy about fixed telecom networks.
It is too early to use that term for the mobile business, which continues to grow, globally, even if the business is mature in developed markets.

Still, developed market revenue trends have been dipping since 2008, for example, according to the Organization for Economic Cooperation…

Tier-One Telcos Looking for Roles in Virtual and Augmented Reality?

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As is true in almost every other part of the retail-focused telecom business, service providers are exploring roles in the artificial reality or virtual reality area that extend beyond mere connectivity, and move either up the stack or across the value chain.
“Telcos have a key role in enabling VRAR services as providers of broadband and mobile network services, but we see them beginning to explore revenue opportunities in VRAR that are beyond 5G data and connectivity, with some leading players entering key segments of the VRAR supply chain in the past two years,” says Ozgur Aytar, GlobalData director of research. “Take Verizon, for example, that has made acquisitions in VRAR content platforms, while SK Telecom is building its own, or, AT&T that is investing to develop compelling VR experiences and AR apps and Orange is taking steps to increase its participation across the board in devices, platforms, services and original content,” he says.
source: GlobalData
Though it might be eas…

How Much Longer Can Fixed Internet Access Continue to Grow?

U.S. net new internet access accounts grew by about 2.1 million accounts in 2017, according to Leichtman Research Group.
A separate analysis by Convergence Research Group suggests U.S. internet access accounts grew by about 2.33 million accounts in 2017, reaching 96.95 million total accounts. At the same time, subscription revenue grew seven percent in 2017 to $56.8 million.
Convergence Research Group expects 2.57 million internet access additions and six percent revenue growth to $60.5 billion in 2018.
The issue is how close we now are to peak internet access. By at least one estimate, there are 95 million U.S. buyers of fixed network internet access.
In the fourth quarter of 2017 there were an estimated 136.9 million U.S. housing units. Vacancy rates are an issue, though. Some 16.7 million of those units were vacant.
In the fourth quarter of 2017, some seven percent of rental units were unoccupied, as were some 1.6 percent of owned residences. So assume the number of residences where f…

Backwards-Looking Policy Not Suited to Tomorrow's Telecom

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Times of rapid technological change make poor climates for major waves of new regulation. Consider the Telecom Act of 1996, the first major revision of U.S. telecom law since 1934. The whole point of the act was to open up competition for voice services.
As all now know, that was just a few years before the absolute peak of usage of voice services, and the beginning of the internet era.
As the old adage goes, generals always prepare to fight the last war. That is a useful historical reminder as competition, innovation and business models in telecom prepare to enter the next big era of change. Our past understandings of how value is created, by whom, and what all that means for business models and competitor fortunes, are about to face historic change. Consider only the fact that unprecedented and huge amounts of new mobile and wireless spectrum are going to be released to support services in the 5G era, dwarfing all existing capacity.
Over the next few years, new spectrum allocations wi…