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OTTs Versus Telcos: Network Neutrality and Operator Strategies

In: Future Telco

Author

Listed:
  • Arnulf Heuermann

    (Detecon International GmbH)

Abstract

Demand for OTT Apps in the public internet is booming. Telecommunications Companies (Telcos) are profiting from these service offerings as the demand for broadband network access can be derived as a complementary product. However, OTTs are also offering communication Apps like VoIP or messaging services that are substituting traditional Telco services (e.g. telephony and SMS). Telcos are facing the erosion of traditional retail market revenues as OTTs are more agile and innovative and better use price models like advertising and data selling rather than rental and usage fees. Net-neutrality rules are limiting the discretionary freedom of Telcos for attack and co-operation strategies. Thus Telcos need to concentrate on their strength of network ownership. One element is pricing attractive bundles of network access and data usage, often in combination with Telco/OTT retail service bundles. The other element will be the slicing of their network for specific “vertical” industry use cases (e.g. in the IoT M2M, eHealth, autonomous driving segment). Network slicing with specific features that the public internet does not guarantee like low latency, high security or guaranteed high data throughput cannot be copied by OTTs.

Suggested Citation

  • Arnulf Heuermann, 2019. "OTTs Versus Telcos: Network Neutrality and Operator Strategies," Management for Professionals, in: Peter Krüssel (ed.), Future Telco, pages 251-261, Springer.
    • Handle: RePEc:spr:mgmchp:978-3-319-77724-5_22
    DOI: 10.1007/978-3-319-77724-5_22
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