The utility trap: Staying on the right side of regulators

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As society becomes ever more dependent on connectivity, telcos face a growing risk of being regulated like traditional utility companies. This report details how operators can avoid falling into “the utility trap” and drive growth in the next decade.


Format: PDF filePages: 36 pagesAuthor: George GlanvillePublication Date: April 2024

Table of Contents

  • Executive Summary
    • The utility trap is a tangible threat for telcos
    • How does the utility trap work in practice?
    • Steps to capture growth in the face of utility-like regulation
  • Introduction
    • Is connectivity now a utility?
    • There is disparity in the regulation of connectivity and traditional utilities
    • What is the utility trap?
    • Why is the utility trap a pressing issue in 2024?
  • What is the mechanism behind the utility trap?
    • Inflation-linked price increases: How telcos in the UK fell into the utility trap
    • Rogers Communications’ network outage: Pricing strategy is not the only way to fall into the utility trap
    • The full-fibre market in Canada: Telcos must also consider the competitive landscape
  • Telcos must collaborate closely with regulators
    • The ABPI Code of Practice
    • What would a telco code of practice look like?
    • Connectivity targets: Telcos and regulators must establish a shared vision
  • There is a limit to what telcos can control
    • Argentina: The regulatory response in an economy with spiralling inflation
  • Utility-like regulation does not necessarily preclude growth
    • South Korea: How telcos can thrive in the face of utility-like regulation
  • Building layers beyond connectivity
    • Quantitative analysis of regulation and service diversification
  • Conclusion
  • Index

Table of Figures

  • Figure 1: Two avenues to reduce the negative impact of the utility trap
  • Figure 2: Connectivity is critical
  • Figure 3: Is telecoms regulated like a utility in the UK?
  • Figure 4: Factors exacerbating the threat of the utility trap
  • Figure 5: Introduction of inflation-linked price variation terms including an additional fixed percentage
  • Figure 6: The size of mid-contract price increases in April 2023
  • Figure 7: Six tenets of a telco code of practice
  • Figure 8: The “new deal” demanded by the major European telcos
  • Figure 9: Spiralling inflation in Argentina
  • Figure 10: Mandated monthly price increases fall short of inflation
  • Figure 11: There has been stability in the cost of connectivity in South Korea
  • Figure 12: There is a diverse range of verticals for telcos to drive new growth
  • Figure 13: The intersection of regulation, growth and service diversification


Technologies and industry terms referenced include: 5G standalone, ABPI Code of Practice, AGCOM, AI, Argentina, Bell Canada, BT, Canada, Claro, connectivity, cost-of-living crisis, COVID-19, CPI, CRTC, Digital Decade Policy Programme 2030, EBITDA, edge computing, EE, ENACOM, EU, FTTC, FTTP, GDPR, HAKOM, inflation-linked price increases, JAC, KT, LG Uplus, Movistar, MSIT, ofcom, Rogers, RPI, SK Telecom, South Korea, Telecom Argentina, TELUS, UK, UN, USA, Utilities, utility trap, VMO2, Vodafone