Innovation requires collaboration

Emeka Obiodu/Ovum
12 Jul 2011

Ovum’s recently published Innovation Radar series painted an interesting picture for telco innovation in the second half of 2010.

Among the 300 new service launches that we tracked across the fixed and mobile market segments, the major trend was that telcos are now innovating more collaboratively than they did in the past.

This view supports some of the views expressed in the Institute of Telecommunications Professionals’ (ITP) “Making innovation work for you” seminar at which Ovum spoke at recently.

In an environment where the pace of technological change is rapid, the telecom industry is carving a niche for itself by nurturing an adaptable structure that can support innovation, rather than seeking to create the next “killer application.”

This structure creates an environment in which individuals, small businesses, telecom vendors, and the wider society can unleash their innovative potential.

There are many answers to the question around what constitutes a telco’s core asset. While the access network has traditionally been viewed as a telco’s primary asset, evidence from the market and the growth in fixed and mobile network sharing show that this may have been overemphasized.

Instead, a telco’s brand, retail network, customer relationships, and mineable customer information all combine to create a structure that is difficult to replicate by non-telcos. This collection of functions, alongside the physical network, is a telco’s core asset.

However, telcos need to turn this core asset into a “killer structure” by making it adaptable and malleable for multi-purpose use. By forsaking the pursuit of a killer application, the telecom industry has accepted that the market prefers an open, unconstrained, and democratic platform such as the internet.

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