Orange CEO Christel Heydemann (pictured) delivered a dour summary of the crunch being felt by Europe’s mobile operators, with contradictory pressures to meet ever-rising traffic, mostly originating from large digital players, while keeping prices low and squeezing costs.
Speaking in the first MWC23 Barcelona keynote, the executive cited a PwC study claiming 46 per cent of telecoms CEOs think their companies won’t make another decade.
“Over the last ten years the situation for European telcos has become completely paradoxical,” she added. “From fierce competition to sometimes outdated regulations, our sector is dealing with contradictory requirements.”
Returning to the PwC statistic, she noted the dour outlook was due to “the massive network investments [of] almost €600 billion in the last decade…[being] hard to monetise”.
“Consumers always expect to pay less and get more,” she added. “In the meantime telcos are facing pressure to squeeze capex while coping with exponential traffic growth, mainly concentrated from a handful of digital players.”
In an era where many operators have already disposed of tower assets, Heydemann said investment in infrastructure was one “some telcos are no longer able to absorb and are consequently compelled to partly sell their assets off”.
She noted there was a need to step aside and take a fresh look at the industry, alongside promoting the open, collaborative approach across the industry with initiatives such as the GSMA Open Gateway Initiative.
To achieve the vaunted digital world of the future, she noted: “Telcos have to deal with a very difficult equation between investment and regulation”, stating the pressure to provide increased capacity while meeting European Union digital decade targets.
“Europe needs a bigger push to hit these targets,” she added, “and the push needs to be applied to the whole digital ecosystem, not just telecommunications operators. It is time to recognise the telecommunications industry has been one of the biggest contributors to our economies through massive investments.”
“Fair play rules start by reflecting the unbalanced situation here,” she added. “Five of the largest online traffic generators account for 55 per cent of daily traffic on telco networks. My conviction…is that regulators and policymakers have a major role to play to balance this unsustainable situation.”Subscribe to our daily newsletter Back