Both telcos and the groups that regulate them must be adaptable in order to prepare for the expected surge in global data, the chairman of Spanish incumbent Telefonica said yesterday.
Closer ties with content providers must go hand in hand with…
Both telcos and the groups that regulate them must be adaptable in order to prepare for the expected surge in global data, the chairman of Spanish incumbent Telefonica said yesterday.
Closer ties with content providers must go hand in hand with regulation that allows operators to recover network investment costs, Cesar Alierta told delegates at the Mobile World Congress in Barcelona.
According to Alierta, the anticipated growth in mobile traffic will require operators to develop and strengthen fixed networks, as well as increase the number and capacity of mobile nodes tenfold.
However, content and service providers “hardly contribute” to this network cost.
“The new challenges must be assumed via a strategy of alliances and cooperation with other sector agents to ensure that the full potential of digital services is unlocked,” he said.
Furthermore, Alierta criticised how telcos, which operate in a fragmented market, are subject to regulation, whereas the more concentrated market of device suppliers and internet players remains unregulated.
Speaking on the same session, Vittorio Colao, CEO of UK mobile operator Vodafone, also criticised regulators, accusing them of being on “auto-pilot” with mobile termination fees.
According to Colao, his group starts every year with between £150m and £250m less cash because of the requirement to lower termination rates and interconnection charges.
Although these fees may have been suitable a few years ago, they longer apply today, he said, adding that regulators must implement more “industrial and forward-looking policies”.
In addition, Colao also criticised “misguided attempts” from some governments for being too focused on spectrum auctions as a way to raise money in the short term, which he described as “not investor friendly”.
Singling out India, where Vodafone has also been involved in a long-running tax dispute, he labelled the country’s efforts to recharge for 2G spectrum “erratic”.
In spite of all of these concerns, however, Colao and Alierta both gave resounding positive notes for the future of their sector.
Seeing signs of recovery from across the world, Alierta told delegates that he expects the sector will return to average growth rates of 4.3% over the next five years, boosted by emerging markets.
“We have now created a connected world and demand for telecommunications connectivity will continue to grow, incorporating more homes, more people, more businesses and even more devices,” he said.
“Moreover, the digitalisation of the real economy … has broadened the scope of our market, since there is a burgeoning demand for new accessible digital applications and services with quality and speed anytime, anywhere.”
