Broadband access could be worth $416bn by 2020

The market for broadband access over fixed and mobile networks could be worth up to $416bn by 2020.

That's an increase of 52% on this year's forecast revenues of $274bn. The study also says that $138bn, or 32% of the total revenue, will come from mobile access.

The study also says that operators will benefit from both new types of broadband wholesale and more sophisticated retail offerings, helping them avoid becoming commoditised 'dumb pipe' offerings.

Dean Bubley, co-author of the report and founder of Disruptive Analysis, said: “Both fixed and mobile operators need to look beyond the traditional ‘end user subscription mindset’, and examine innovative wholesale opportunities. At the same time, they need to embrace radical evolution of their retail portfolios - for example, supporting prepaid fixed broadband, or offering innovative tiering and policy structures for mobile Internet access from smartphones and tablets."

The study says that the big winners in retail broadband will be in fibre-based fixed services and mobile data for smartphones. ADSL and cable revenues will peak in mid-decade, and then decline as they get replaced with fibre connections.

In wholesale broadband, the study suggests three ways in which the market will grow.

Bulk wholesale offerings, similar to today’s approach to mobile virtual network operators, will grow as governments force greater openness on telecoms licensees and operators look for partnerships to supply new markets. The study suggests that some of these connections may not be paid for by the end user, for example in the case where local authorities provide free broadband to disadvantaged communities.

The second growth opportunity will come from bundling data service with a device, as Amazon has done with it Kindle e-reader and as some wireless-enabled memory cards for digital cameras are now offering.

The third growth opportunity involves operators selling data capacity in small parcels to parties other than the user, so that these companies, who might be M2M service providers or content providers, so that they pay for the data transmission rather than the end-user. The study forecasts that the extra mobile broadband revenue generated by this “slice and dice” approach could be worth $21bn worldwide by 2020.

Chris Barraclough, co-author of the report and managing director of Telco 2.0, said: “There are many creative ways that operators can add more value for existing downstream customers. Companies providing services over the internet will increasingly seek to mash-up connectivity more tightly with their own offerings, for example by including connectivity as a part of their products. These new ‘upstream’ customers are forecast to generate over $90bn in broadband revenues globally by 2020.”

The report, “Mobile, Fixed and Wholesale Broadband Business Models: Best Practice Innovation, ‘Telco 2.0’ Opportunities, Forecasts and Future Scenarios” is available from Telco 2.0.

Broadband access could be worth $416bn by 2020

The market for broadband access over fixed and mobile networks could be worth up to $416bn by 2020, according to a study by the Telco 2.0 Initiative, a consultancy.

That's an increase of 52% on this year's forecast revenues of $274bn. The study also says that $138bn, or 32% of the total revenue, will come from mobile access.

The study also says that operators will benefit from both new types of broadband wholesale and more sophisticated retail offerings, helping them avoid becoming commoditised 'dumb pipe' offerings.

Dean Bubley, co-author of the report and founder of Disruptive Analysis, said: “Both fixed and mobile operators need to look beyond the traditional ‘end user subscription mindset’, and examine innovative wholesale opportunities. At the same time, they need to embrace radical evolution of their retail portfolios - for example, supporting prepaid fixed broadband, or offering innovative tiering and policy structures for mobile Internet access from smartphones and tablets."

The study says that the big winners in retail broadband will be in fibre-based fixed services and mobile data for smartphones. ADSL and cable revenues will peak in mid-decade, and then decline as they get replaced with fibre connections.

In wholesale broadband, the study suggests three ways in which the market will grow.

Bulk wholesale offerings, similar to today’s approach to mobile virtual network operators, will grow as governments force greater openness on telecoms licensees and operators look for partnerships to supply new markets. The study suggests that some of these connections may not be paid for by the end user, for example in the case where local authorities provide free broadband to disadvantaged communities.

The second growth opportunity will come from bundling data service with a device, as Amazon has done with it Kindle e-reader and as some wireless-enabled memory cards for digital cameras are now offering.

The third growth opportunity involves operators selling data capacity in small parcels to parties other than the user, so that these companies, who might be M2M service providers or content providers, so that they pay for the data transmission rather than the end-user. The study forecasts that the extra mobile broadband revenue generated by this “slice and dice” approach could be worth $21bn worldwide by 2020.

Chris Barraclough, co-author of the report and managing director of Telco 2.0, said: “There are many creative ways that operators can add more value for existing downstream customers. Companies providing services over the internet will increasingly seek to mash-up connectivity more tightly with their own offerings, for example by including connectivity as a part of their products. These new ‘upstream’ customers are forecast to generate over $90bn in broadband revenues globally by 2020.”

The report, “Mobile, Fixed and Wholesale Broadband Business Models: Best Practice Innovation, ‘Telco 2.0’ Opportunities, Forecasts and Future Scenarios” is available from Telco 2.0.

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