Season's Greetings

“You may compete with everybody but not with your customers !” Richard Stastny.

I wish you, as well as your family members, a jolly good time during this upcoming festive season.

The end of the year is usually a good time to pause and predict what could happen during the new year. I wanted to start a tradition with the Australian Telecommunications 2007 Predictions Survey, which yielded some interesting prophecies. While I agree with Warren Buffet when he stated that ‘‘I have long felt that the only value of stock forecasters is to make fortune tellers look good’’, there is little harm done with polishing our crystal ball and hypothesising on the upcoming year in Australian Telecom landscape.

In the Access sphere, respondents have predicted that “State Governments spend $billions on building metro area fibre access/backhaul networks to serve their own requirements, and then they open them up to Telstra (Australian incumbent) Competitors”, “First commercial deployment of a WiMAX offer” and that “Hutchinson may divest from its Three network in Australia after the upgrade of its network to HSDPA.” These predictions seem to signal a new age for Australian broadband. 2006 was the year broadband democratised with over 2.3 million Australian homes now with broadband, and with DSL used in 83% of broadband enabled households. 2007 will be the year when broadband becomes an enabler of service and content rich offers. This could result in at least one major PMI engagement in Australia and new billing platforms integration programmes.

In the Service arena, respondents were quick to forecast “iiNet/PowerTel drive VAS packages to SMBs (e.g. mini-managed services like remote backup)”, “Telstra and Vodafone get serious about Small and Medium Businesses (SMB)”, “VoIP based hardware (e.g. Skype/DECT phones, Apple iPhone) is bundled with high-end DSL packages.” 2007 may be the year ISPs use Customer Premise Equipment and Value Added Services (VAS) to their advantage to reduce churn and acquire existing SMB and consumer customers from other providers. Offers like Managed Services, Security, PC support, VoIP and IPTV may become the tip of the spear for ADSL providers willing to integrate them. This would mean complex IMS type of integration work for Telcos in 2007 and beyond.

Content is king, we are told so here are some regal predictions from Telco strategists. “Everyone will offer mainstream content (e.g. music downloads)”, “NewsCorp [or Mac Media Fund] buys Channel Ten”, “Optus and Telstra form more alliances with content owners and advertisers to maintain profitability and defend broadband market share.” Telcos seem to have understood in 2006 that they need to form alliances with content providers to leverage their scale in front of smaller, low costs, operators aggressively rolling out DSLAMs regionally. This shift in thinking is probably not shared among all the employees at the Telcos and this opens opportunities for consultants to help the C suite operationalise their strategies.

We will revisit these predictions in one year to bring some accountability in the process and celebrate the most accurate “fortune teller” among us. With my track record, predicting last year “VoIP over 3G is poised to become a big thing in 2006…” I am sure to get disqualified.