APAC telcos concentrate on quality

Joseph Waring
20 Feb 2012

Respondent profile
The Telecom Asia-Ovum online survey was conducted in late December and January and had responses from telecom executives in 19 countries across Asia Pacific. Almost a quarter of those surveyed were mobile operators, 17% were integrated service providers and another 13% were fixed-line players. India represented 17% of the total respondents, Indonesia 12%, and Malaysia and the Philippines each 8%. Management accounted for 21% of respondents, another 21% were from engineering and operations, and 28% were from sales and marketing. This is the fourth year the survey has been conducted.

Quality of service is now the key distinguishing feature for operators in today’s environment where it is increasingly difficult for mobile operators to set their services apart from the competition. According to a joint Telecom Asia-Ovum online survey, more than a third of telecom executives in Asia Pacific see QoS as their most important differentiator (see chart 1 ).

That’s a big jump from just a year ago when coverage topped the list, with 28% of those surveyed considering it most important and 24% indicating QoS as the key. QoS was up 13 percentage points while coverage dropped a staggering 14 percentage points to the fourth position, behind price and speed which moved up to second place even though it had about the same percentage as a year ago (22%). Price was also in line with last year’s results (up slightly to 16% from 14%). And surprisingly apps & content fell slightly (to 9% from 11% last year).

“Operators must strive to avoid network congestion and outages, which can badly affect their perception with customers,” said Ovum senior analyst Nicole McCormick. “However, reliable networks equal continued capex, which is more accessible for the dominant market players.”

Of the operators that viewed QoS as the most important differentiating factor, 32% came from India and Indonesia, two markets prone to high levels of congestion in some hotspot areas. In these key emerging markets with low ARPU, McCormick noted that price for mobile broadband service has commoditized, meaning operators will need to invest to maintain QoS or risk losing market share to their rivals.

Looking at the most effective way to charge for mobile broadband, we were pleased to see that fewer respondents (38%) viewed unlimited data rates as the most effective way to charge for mobile broadband services compared to two years ago when 51.4% of respondents said the same.

But McCormick said, “we are concerned that this year’s figure is still too high. While there is growing support for volume-based pricing and quality-of-service-based pricing among respondents, Ovum urges operators to steer away from flat-rates, which can over-burden networks and reduce the quality of experience for customers. While this might seem impossible to do in a well-entrenched flat-rate 3.5G market, our research shows that many operators are transitioning to LTE without unlimited data.”

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