Friday, March 11, 2011

Web players must help fund networks says new GSMA chief

Mobile operators have been arguing for some time that if over-the-top providers are going to take much of the revenue from the mobile data boom, they should also help invest in the networks to support it. It's the sort of thing that one hears in an ecosystem changing rapidly, with value and revenue distributions changing just as rapidly.

Franco Bernabe, former CEO of Telecom Italia and now the new head of the GSMA, says it is time to review the way networks are funded. Application providers won't agree. But it is hard to see how broadband consumption can keep growing, with matching investment, if additional revenue to build and upgrade the networks is not available. And one can argue such revenue will not be available if usage grows by two orders of magnitude while retail prices grow only linearly. 

For that reason, talk of two-sided business models will grow.

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