One of the chief challenges of monetizing fixed broadband is the need to fulfill customized service requirements. The key, says Hillee Li, chief business architect at Huawei Technologies, is SDN-based bandwidth on demand enabled by a flexible network infrastructure
Broadband Insights: What are the current trends you’re seeing in the fixed broadband (FBB) market?
Hillee Li: HD video is a very popular application in the market. HD content delivery services requires more bandwidth and more reliable connectivity to support the customer experience. Thus, performance of experience [POE] has become the top priority for operators, rather than the “best effort” approach of carrying content.
Another trend is that the multi-play model will replace single-play. When it comes to subscribing to telecoms services, consumers increasingly want more value for less money, which is why many operators have bundled additional applications and content together with bandwidth, which has proven a popular success.
Also, today FBB operators are trying to find ways to serve total solutions not only to the mass market but also to the market of communities. Since these market communities have more customized requirements, this looks like a blue sea for operators to develop new business.
How are those trends impacting operators in terms of network requirements and business models?
The requirements above have made operators think more about ideas to improve their network capabilities to support different qualities of content delivery experience, and also seek more valuable and applied service packages with suitable marketing models.
From the network requirement point of view, solutions like bandwidth expansion, elastic bandwidth management, and dedicated bandwidth for services are being considered. As for business models, operators need to follow these principles in refreshing their current marketing model: How to develop products? How to price? How to find the right buyers? And even on how to ally with third parties to combine and share revenue? Considering the core value of their carrier network, operators need to think more about how to monetize those network capabilities as much as possible, in order for it to make sense for both service providers and the consumers.
What FBB monetization models look the most promising to operators right now?
An increasingly attractive service-delivery model is one that combines basic bandwidth and accounting or content oriented bandwidth on demand, because it offers the best POE towards the consumer and also saves unnecessary costs of network resources for service/content providers. This has already been demonstrated in more and more markets worldwide from operators like China Telecom, China Mobile and Turkcell.