The Future of Mobile Carriers: Basic Utility or Major Player
Mobile data traffic is expected to grow 108 percent Year-Over-Year from 2009 to 2014 worldwide, but according to ABI Research, mobile data revenue is only growing at about 18 percent CARG in North America. With data usage growing so rapidly, mobile carriers are desperate to find ways to fortify their eroding margins by adding value to their network and monetizing the traffic.
Let's say that 2015 is the year mobile devices surpass PCs as the most common channel for accessing the Internet. I see two possible scenarios playing out for the mobile carriers:
• Scenario 1: Carriers simply deliver the data.
• Scenario 2: Carriers become one of the most essential pieces in the mobile economy.
Scenario 1: Carriers Just Carry
In this scenario, carriers have invested more into network capabilities . They are content with a business model that simply charges for moving data from point A to point B. They will compete on price per bit and only differentiate themselves according to the relative speed of their network.
Carriers will seem more like public utilities in the eyes of the consumer—access providers in the strictest sense—while devices, apps, and even operating systems will battle for brand awareness.
In this scenario, operators struggle to move up the value chain to become more relevant to the Internet because they’ve been cut off by players such as Apple, Google, and Microsoft. If carriers in this scenario are going to make any additional revenue it will be by selling non-personally identifiable information (non-PII) about their subscribers to third-party vendors, who will then sell the data to advertising networks, publishers, and enterprises at a significant margin. (It will be difficult for these carriers to sell their data directly as they lack the analytics capabilities to build customer profiles.
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