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Data-dependent operators to implement tiered services to maintain revenue and combat rising costs

Analysys Mason predicts decoupling of revenue and network costs as operators become increasingly data dependent.

Mobile operators will abandon network cost-based pricing to focus on premium services, as they look to reduce churn and maintain revenues according to a new paper released by Analysys Mason.

This transformation, enabled by new end-to-end approaches to network management, arrives in the face of growing competition from over-the-top (OTT) services and rapidly rising data costs.

The report estimates that the volume of wireless data traffic worldwide will grow at an annual rate of 67% between 2010 and 2015. During the same period, data revenue per gigabyte is projected to fall from USD23.21 to USD4.27.

The report reveals that, in order to handle this growth whilst assuring revenues, operators are increasingly looking to offer new services such as temporary network speed boost and tiered bandwidth allocation to create a premium service for high value customers.

Interviews with operators have shown that the main obstacle to the delivery of these services is their` ‘silo’ approach to network delivery, which hinders a full view of the customer experience. Operators are increasingly employing end-to-end network monitoring solutions to eliminate these silos and create real-time, end-to-end monitoring.

Operators implementing this new, unified approach to network monitoring - including Vodacom, part of Vodafone - reported reduced churn, increased levels of customer care and a renewed ability to differentiate and remodel their services around premium offerings.

In the report, Analysys Mason urges operators to:

  • increase adoption of network monitoring to eliminate silos and more fully understand the user experience
  • take advantage of real-time data collection and analysis to enable traffic prioritisation and tiered billing models
  • adopt open platforms to unify the entire network management system.

The paper, sponsored by CommProve, a leading provider of network monitoring and business solutions for mobile networks, surveyed a number of mobile network operators.

The research investigates operator strategies to tackle growing data needs and loss of revenue to OTT services.