26 April 2012

NetEvents APAC Press Summit, Hong Kong - Day 2 - 'In the Hot Seat' Summary

Jim Machi, Vice President, Marketing, Dialogic Corporation: The Challenges for the mobile Internet
Opening the short presentation, Machi noted that everyone in the room had three devices, and that this was not unusual. As a result, he said, "data growth is huge, especially here in APAC."

That growth will continue, he forecast, as tablet numbers are growing and they use 25 times more data than phones. " Video is an especially huge challenge," he said. "How do you handle it all? How do you make money out of it - data revenues are different from voice revenues. Also how operators build a business model given the increasing volumes of over-the-top provider's data?"

He said that the impact on average revenue per user (ARPU) meant that this was declining for operators who have voice and for those who have voice and data - but that voice-only is declining even faster. "Subscriber happiness because of network congestion is a problem especially in crowded areas," he said.

For Machi, this left mobile operators with a number of options:
- Data offload - get users to use wifi not 3G as much as possible.
- Network upgrade eg LTE/4G.
- New technology
- Deploy new capacity - for example, build new towers
- Cap data for data hogs
- Optimisation - "we offer this," he said - which means squeeze and compress data to get more out of the bandwidth.

"What can a service provider do?", asked Machi. "They can be a bitpipe provider, a smart pipe provider, or they can add value added services which bring in 20% more revenue than dumb pipes. Operators need to find those new services now."

Machi was then interviewed in the hot seat by Dubash, who asked about the future for the operators, and both whether and how they could make the move up from being dumb pipe providers to being content providers. Machi said that he was not optimistic, but said that the operator industry would see consolidation or some would not last. "It will be survival of the fittest," he said.

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