Mobile Broadband Service Providers Have to Improve Network Efficiency, Say Experts
Competition among broadband service providers has been intense in the past few years, and it has reached a point where prices are rock bottom and value added services such as laptops and free netbook offers have failed to add on to the profits. Analysts are of the opinion that as the subscriber base increases, losses will be compounded. So what can telecom companies do to tide over this crisis?
Steven Hartley, an analyst at telecom consultancy Ovum, suggests that the fixed-rate plans that telecom companies use to drive customer acquisition are the ones that will cause the greatest losses. As customers get used to mobile broadband, data downloads will increase significantly. As mobile access becomes the norm, subscribers will get used to downloading increasing amounts of data through mobile connections. Once networks are able to support the streaming of video data, data usage will increase, which will make it more and more difficult for service providers to stay profitable with the flat-rate pricing model.
Network optimisation is being considered as the solution for the current situation. Hartley and other analysts believe that carrying more data efficiently will enable service providers to meet the increasing demand for data without affecting profits. This will also preclude the move to pay-per-use pricing models, which customers have an aversion for.
Another strategy that analysts recommend is strong emphasis on customer retention strategies, which is good news for customers as it usually translates to better service standards.
