Mobile operator executives continue to believe that “disruptive competition” from over-the-top app providers is the single greatest business challenge they face, followed by uncertainty of the regulatory environment, lack of organizational agility and return on investment.
Given the shrinking sales volume and revenue from legacy revenue sources (voice, messaging) challenged profit margins on newer services (internet access, enterprise data) and difficulty of competing in some new areas (data centers), such concerns are understandable.
Optimists continue to believe that connectivity revenues can benefit from “supporting” OTT app providers. And, of course, there is truth in that belief. The internet access revenue stream would not exist were it not for the value of internet-based apps.
Connectivity providers that own content services, enterprise unified communications services or other OTT services also benefit.
On the other hand, the internet also enables several types of competition for connectivity provider services, in the form of product substitutes.
It remains unclear how the “edge computing as a service” develops. It likewise remains unclear what roles connectivity providers might play. AWS Local Zone, for example, is an edge computing service directly available to enterprises. Likewise, AWS Outposts puts AWS servers directly into an enterprise data center, creating yet another way AWS becomes a supplier of edge computing services.
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