Telco-Driven Disruption: What NTT DOCOMO, KT and Globe got right

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As they seek new sources of revenue, many telcos around the world are attempting to disrupt adjacent markets, such as digital commerce, IT, entertainment and financial services. While many of these moves have proved to be too little, too late, several disruptive plays have had a significant impact on both the telco’s revenues and relevance. These include NTT DOCOMO’s Smart Life portfolio, Globe Telecom’s GCash service and KT’s media business. Why do some disruptive moves by telcos succeed and others fail?


Format: PDF filePages: 49 pagesCharts: 21Author: STL research teamPublication Date: July 2015

Table of Contents

  • Preface
  • Executive Summary
  • Introduction: Telcos can and do disrupt
  • Offensive, major financial impact
  • NTT DOCOMO’s Smart Life proposition
  • Globe Telecom’s GCash
  • Offensive, limited financial impact
  • Verizon Cloud
  • The Weve joint venture
  • The Softcard joint venture
  • Defensive, major financial impact
  • KT’s media business
  • Conclusions

Table of Figures

  • Figure 1: Representative examples of disruptive plays driven by telcos
  • Figure 2: The smart life strategy NTT DOCOMO set out in 2011
  • Figure 3: DOCOMO has significantly expanded the services offered by dmarket
  • Figure 4: DOCOMO’s personal cloud aims to offer consumers secure data storage, persistent ID and personalised recommendations
  • Figure 5: The Smart Life businesses are growing, but not quite fast enough yet
  • Figure 6: DOCOMO hopes its Smart Life business will lift group profits this year
  • Figure 7: The Smart Life businesses now generate 15% of DOCOMO’s ARPU
  • Figure 8: In 2011 DOCOMO saw digital commerce and content as key opportunities
  • Figure 9: The value of transactions through the dmarket has grown rapidly
  • Figure 10: Subscriber growth at dmarket stalled in the first half of 2014
  • Figure 11: TV-on-demand is the most popular of the dmarket services
  • Figure 12: NTT DOCOMO is putting more emphasis on providing enablers
  • Figure 13: DOCOMO’s confusing portfolio of money services
  • Figure 14: The GCash App has improved its user interface
  • Figure 15: GCash appears to be narrowly ahead of rival services
  • Figure 16: Facebook leads the OTT communications market in the Philippines
  • Figure 17: Verizon’s Global Enterprise revenues continue to fall
  • Figure 18: Weve originally planned to used transactional data to improve marketing
  • Figure 19: The Isis Wallet could be used to store and browse offers
  • Figure 20: KT is successfully managing the transition to IPTV
  • Figure 21: KT’s media revenue has climbed to 6% of total revenues

Technologies and industry terms referenced include: big data, business models, Cloud, digital commerce, Internet of Things, localized commerce, mobile advertising, mobile commerce, mobile marketing, mobile payments, Mobile wallets, Personal Data, smartphones, Strategy, Telco, Telecom