What is disruption, when is it a good idea, and what do you do when it happens to you? We illustrate five principles of disruptive strategy based on our analysis of the telecoms and adjacent markets over the past eight years. The analysis covers both principles of creating and defending against disruption.
Disruption is now widely spread and relatively well recognised throughout the global economy, but dealing with it is another matter. This challenge is central to the agenda of strategists and decision makers in every industry, particularly among Telecoms, Media, Technology, Retail, Finance, and Consumer Brands. What are the key factors, lessons and strategies for success in the increasingly dynamic and …
Facing lockout from a growing chunk of the Internet and mounting competition from the Facebook-Microsoft alliance and Amazon, Google’s core business is under intense pressure. The search giant’s response is to innovate, offering consumers proactive recommendations, as well as reactive search results. Once an interesting sideline, Google Now has become fundamental to the Mountain View company’s future. Is the suggestion service good enough to maintain Google’s position as the world’s leading big data company?
Digital transformation is now impacting every industry, and one of the hardest organisational challenges is developing small-scale innovations fast and managing them in large and mature organisations. Here are our recommendations and key findings from the OnFuture EMEA 2014 cross-industry brainstorm, including a summary of Facebook’s internal recipe for speedy success. (June 2014, Executive Briefing Service, Transformation Stream.)
Existing Business remains the biggest obstacle to innovation
Operators face difficult choices on the best way to change their business models. In this note we analyse the approaches taken by AT&T, Verizon, Ooredoo, Singtel and Telefonica, extrapolate the options for all carriers, and offer a framework to help managers define the right new business model goal for their organisation.
So Facebook is buying the mobile IM app WhatsApp for $19bn including $4bn in cash, and WhatsApp is launching a voice service. Why, and what are the consequences and lessons for telcos and others?
Our new research shows how telcos can slow the decline of voice and messaging revenues and build new communications services to maximise revenues and relevance with both consumer and enterprise customers. It includes detailed forecasts for 9 markets, in which the total decline is forecast between -25% and -46% on a $375bn base between 2012 and 2018, giving telcos an $80bn opportunity to fight for. It also shows impacts and implications for other technology players including vendors and partners, and general lessons for competing with disruptive players in all markets. It looks at the impact of so-called OTT competition, market trends and drivers, bundling strategies, operators developing their own Telco-OTT apps, advanced Enterprise Communications services, and the opportunities to exploit new standards such as RCS, WebRTC and VoLTE. (November 2013, Executive Briefing Service). Future Value of Voice and Messaging Cover Small
Telcos, Internet and technology players, banks and payment networks have disruptive $billion opportunities to act as intermediaries / enablers in mobile commerce and personal cloud services, based on the appropriate use of customer data. This report is a unique and comprehensive strategic guide for success in these roles. It analyses the strategies of the main and cutting-edge players, and outlines key success factors in designing and delivering customer propositions, technology, organisation and value network strategies. It also includes evaluations of the related strategic opportunities of ‘raw big data’, professional data services, and internal data use, and a business model showing how one type of candidate for the intermediary role, a telco, could grow profitable new revenues equivalent to c.$50Bn (5% of existing core revenues) within five years. (October 2013, Dealing with Dsiruption Stream). Telco 2.0 Transformation Index Small
Facebook has launched ‘Facebook Home’, technically a shell around the Android OS, that in theory creates valuable new advertising inventory on the screens of users’ phones. What will its impact be in practice for Facebook, and on Google, mobile operators, and other device manufacturers? (April 2013, Foundation 2.0, Executive Briefing Service, Dealing with Disruption Stream.)
Facebook Home ‘Coverfeed’ April 2013
Telcos traditionally think of every new service as a profitable new revenue source, and create services in silos with little thought for the total customer experience and overall creation of value. In contrast, the big internet and tech players typically build their future offerings as part of an integrated strategy to raise the overall value of their platforms. This extract from ‘A Practical Guide to Implementing Telco 2.0’ shows key lessons for telcos. (September 2012, Executive Briefing Service, Dealing with Disruption Stream.)
Generic Telco Strategies September 2012
HTML5 will have a profound impact on consumers’ and businesses’ interaction with the web in coming years. In particular, HTML5-compliant smartphones may lead to a reduction in the power of closed app platforms such as Apple iOS and Google Android. While this seems broadly positive for telcos, there may also be negative side-effects of the increasing capability of standardised (and often free) Internet capabilities.
Google’s shares have made little headway recently despite its dominance in search and advertising, and it faces increasing regulatory threats in this area. It either needs to find new sources of value growth or start paying out dividends, like Microsoft, Apple (or indeed, a telco). Overall, this is resulting in something of a strategic identity crisis. A review of Google’s strategy and implications for Telcos. (March 2012, Executive Briefing Service, Dealing with Disruption Stream).
Google’s Advertising Revenues Cascade
Key trends, tactics, and technologies for mobile broadband networks and services that will influence mid-term revenue opportunities, cost structures and competitive threats. Includes consideration of LTE, network sharing, WiFi, next-gen IP (EPC), small cells, CDNs, policy control, business model enablers and more. (March 2012, Executive Briefing Service, Future of the Networks Stream).
Trends in European data usage
What is a ‘business model problem’? How can you tell when you’ve got one? What are the key business model challenges faced by telcos today, and how should they address them? (February 2012, Foundation 2.0)
Rabbit in Headlights
New figures released in Facebook’s S-1 filing for its IPO stack up with Telco 2.0’s previous analysis of Facebook’s performance for our report ‘Dealing with the Disruptors’. This further strengthens our views that many mooted valuations are overblown, and that Facebook will seek new sources of value in communications. (February 2012, Executive Briefing Service, Dealing with Disruption Stream).
Facebook user saturation bubble chart
An extract from our 284 page, 124 chart, strategy report that analyses the business models, markets, objectives, strategies and modus operandi of the major adjacent players, and their current and future impact on the telecoms industry. The report identifies the areas and options for competition and co-operation, and outlines potential strategies for interacting with each player. It also draws the combined activities of the digital empires – telcos, so called ‘OTT players’ and others – into the context of the new ‘Great Game’, the battle for power and value in the emerging digital economy. (Page updated February 2012, report published November 2011, Dealing with Disruption stream) Google Apple Facebook Microsoft Skype Amazon Telco 2.0 Disruptor Report Cover
The telecoms industry often puts so-called OTT (over-the-top) players like Google and Facebook at the forefront of its concerns, as they pose new competition for services and applications. But what about encroachment of companies “underneath” the telcos, displacing them from their core asset, the network? Telco 2.0 examines the strategic threats and opportunities from wholesale providers, outsourcers and government-run broadband networks. (January 2012, Executive Briefing Service, Future of the Networks Stream).
UTF Image Jan 2012