There was a time, early in the 21st century, when there were serious debates about whether the Internet would emerge as the global "next generation network," or whether some other "telecom" network would assume that role.
That we no longer debate the matter seems to be a reflection of the fact that the argument is settled. Even as new managed services networks are created (LTE, 5G), much of the global business does now, in fact, rely upon Internet Protocol and the Internet as the "network."
One can see that in the shift of revenue shares within the mobile and other ecosystems.
Looking only at the mobile business, about 39 percent of ecosystem revenue is earned by mobile operators, and about 34 percent by third party app providers. Nearly 20 percent of revenue is earned by device suppliers and others supporting use of devices.
Among the many contextual issues surrounding the telecom business are:
- overall price, revenue per account, profit margin trends in the communications business
- Marginal cost pricing (near zero pricing, in some cases)
- Exhaustion of legacy product growth
- Value shifts within the ecosystem (OTT, devices)
Taken altogether, the “telecommunications” industry now is part of a larger Internet ecosystem. Managed services and managed networks will continue to exist. But the Internet has become, in many tangible ways, the next generation network.
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