LIVE FROM GSMA MOBILE 360 MIDDLE EAST: Rival UAE operators du and Etisalat were united in their belief that the mobile industry needs to step up a gear in its efforts to grow revenue from mobile data services, particularly as OTT players continue to dominate the launch of innovative new services.
The CEOs of both operators acknowledged that this is a challenge that has affected the industry for many years.
“From 2008-13 global mobile data traffic grew x46 but revenue grew only x2.4. While we monetised almost 50 per cent of global voice traffic [in that period], we only monetised 5 per cent of mobile data traffic… Our ability to respond to a fast changing sector can be best described as slow,” commented Ahmad Julfar (pictured), Group CEO of Etisalat. “We can complain that OTTs are taking away our rightful revenues as they use our networks as dumb pipes, but the fact is these companies are more agile than us and have been the real reason for driving data growth in the telco sector.”
Du CEO Osman Sultan (pictured, left) lamented the mobile industry’s failure to launch global online service phenomena such as Facebook. “The most constructive thing that happened in our industry – social networking – happened without us,” he commented. This is something we need to reflect on with humility.”
The two operator bosses were optimistic that mobile operators could reap future rewards from OTT services, as the digital world is still in its relative infancy, but warned business models must change.
“The world is changing very fast and we should be happy we are at the heart of this change,” said Etisalat’s Julfar. “Due to the high demand on data, telcos will always be relevant – the OTTs are here to stay and we need to find ways to work with them and grow with them. We need to move from competitive value destruction to co-operative value construction. This will help to create better products, of course all the while ensuring consumer privacy.”
Du’s Sultan went as far as to suggest that operators have not yet determined what position they want to play in the evolving digital world. “Why haven’t we been able to create a model to maximise this? Because we exist in silos,” he stressed. “We continue to work in the standard business model. We need an ecosystem that will foster innovation.”
To that end Sultan urged the mobile community to rethink existing strategies. “I’m very passionate about creating a business model to allow operators in the Arab world to exist in the world of direct advertising and operator billing. OTTs are doing a great job and are here to stay but we can gain a piece of the pie if we have these capabilities.”
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