Telco Deep Dive: LTE’s elusive business model: Page 2 of 2
By Edwin Yapp June 10, 2014
Services to expect
Besides the MNOs’ cautious rollout strategy, the lack of a clear roadmap for specific applications and services that would benefit from LTE is another factor that has given them pause.
Frost & Sullivan’s Naveen says applications such as WhatsApp have caused a decline in voice and messaging traffic and revenues, and that in such a scenario, MNOs with LTE networks can focus on offering high-speed and interactive applications with low latency, such as high-definition voice, also known as voice over LTE (VoLTE).
VoLTE is essentially Voice over Internet Protocol (VoIP) running over LTE networks.
“Video streaming and download services, along with machine-to-machine (M2M) and other digital services, could be key services to offer,” he says.
M2M communication allows devices such as smart meters and sensors to report data, via an LTE network, to a utility company, so that it would be able to use the information to automatically track usage and offer tiered pricing.
“For video streaming and downloads, one would just need to work with a few partners whereas for M2M, a large number of partners across the value chain would need to be involved,” Naveen says.
However, RHB Reseach’s Tan expects LTE would not be a game-changer in the short- to medium-term.
“To be able to better monetise revenues on LTE, there has to be a shift towards quality-of-service (QOS)-led and tiered pricing models [instead of a flat rate model],” he says, adding that operators have yet to figure this out conclusively.
“The ecosystem in terms of devices should also be in place and there must be a critical mass of adoption to attain scale and that comes with more extensive coverage,” he adds.
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