When the international submarine cables now being laid are linked to this country’s communications network, the result should not just be faster and possibly even cheaper internet access – it should also be the spur for our telecoms companies to reinvent themselves.
As shown by Etisalat and du’s efforts to protect their market share and profitability by blocking video calling applications, both entitites think of themselves as primarily in the telephone business. While it is natural that these companies attempt to protect their business, the reality is that they are missing an important opportunity to increase their profit margins.
Given the proliferation of smartphone usage around the world, data is now the most important commodity in the telecoms industry. From video calling to watching Netflix, users are consuming large amounts of data.
In a sign of the times, for example, Dubai is set to be the home of seven new digital-only radio stations that most people will enjoy on their smartphones. As our data usage increases, appetite for traditional modes of communication, such as voice calls using telephone infrastructure, dwindles.
If Etisalat and du were to encourage the use of data apps by configuring their business models to focus on data rather than voice consumption, they would bring their operations up to speed with the new economy.
New submarine cables that bring faster internet speeds provide an ideal opportunity to unveil a fresh vision for growth that will exploit the possible confluence of interests between telecoms and users. In the next 10 years, bandwidth capacity could be four times greater with the upgrades.
As this paper recently argued, technological innovation is a critical facet of our knowledge economy. If we want to continue to attract the most talented developers, we need telecoms that are nimble and respond to the demands of the market by offering great data packages. After all, telecoms are one of the most important high-end services in our economy.
Operators must embrace changes in patterns of user consumption by optimising their data services portfolio instead of protecting outdated business models that no longer pay dividends.
