FT chairman forecasts dumb pipe future

Michael Carroll
10 Aug 2010

France Telecom’s chairman has admitted that telcos are becoming dumb pipes, as consumers increasingly focus on applications and devices instead of the service provider.

Didier Lombard said the revolution is already underway, noting that choosing a network provider has become a secondary consideration for most consumers as the lines between personal and business use of mobile phones becomes blurred.

“They think they can find the network anywhere,” Lombard toldForbes.com in an interview, adding. “It is a drastic change in the business model.”

Lombard said carriers must position themselves as service providers who handle sourcing and delivery of content to consumers, and ensure all players in the value chain get their cut of revenues.

He said the best technology to deliver that model would be fiber networks, and that France Telecom would look to transition to the new method in around five years.

Open ecosystems and government policies towards content rights will be key elements in telco’s future success, Lombard noted.

The chairman was forced to resign as France Telecom’s CEO in February, following a spate of staff suicides.


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