Telcos braced and ready for 2015

Telcos braced and ready for 2015

John C. Tanner
telecomasia.net

With 2014 just about over, everyone in the Asia-Pacific telecoms sector is already casting its gaze to 2015. That includes Telecom Asia, and as always, we want to know what everyone else is looking at.

So we asked them.

Our fourth annual Business Outlook Survey - which was conducted online in October and November - is done and dusted, and if there’s any one overall finding we can divine from the results, it’s this: the future is both awesome and terrifying, and while most people have no idea how to get there, they have a pretty good idea where to start looking.

Which isn’t very helpful, so here’s an executive summary: Asia’s telecoms are even more optimistic about 2015 than they were about 2014, and a lot of that hinges on the possibilities of mobile broadband, cloud services and mobile commerce, among other things, to help drive desperately needed new revenue sources. They’re also looking for ways to beat their networks into shape to handle the ongoing deluge of data, though they want to find ways to do it that don’t require extra capex spend. The customer will remain king, and competition will be heavy from traditional and non-traditional players alike.

The future’s ever brighter

As always, we started by asking respondents how optimistic they are about their prospects for 2015 in terms of financial growth for their own company and overall growth for the telecoms sector. The results indicate that there’s a lot to be optimistic about 2015 - even more than last year, in fact, although there’s more optimism about sector growth than there is about reaping financial gains from it.

Close to two thirds of respondents expressed varying levels of optimism about their growth prospects compared to the previous quarter, with over 17% saying they were “very optimistic”. Less than 15% of respondents said they were more pessimistic about growth in 2015. Just over 23% said they don’t expect any real changes in growth next year. That’s a dramatic shift compared to last year, when 44% of respondents expected no change in sector growth. 

Much of that optimism applies to companies’ financial prospects as well, though not quite as much. Just over 57% of respondents expressed optimism about their financial prospects next year compared to the previous quarter - almost 16% were “very optimistic”. Compared to the question of growth prospects, a slightly higher number expect no real changes in 2015 (28.3%), but the level of pessimism is still well below the 15% mark.

Gimme some cloud

What sectors of your business do you think will be key drivers for growth?We asked respondents to tell us the top three sectors where they expect that growth to come from. The results are strikingly similar to last year’s survey: namely, it’s still all about the cloud. 

By far, cloud services (including hosting, storage and apps) will be the biggest growth driver next year, according to almost 72% of respondents. And like last year, the next two biggest anticipated growth drivers are mobile commerce (55%), followed closely by managed services for enterprises. The latter reflects the ongoing desire of operators - especially cellcos - to find ways to expand their customer base beyond the consumer segment.

Mobile commerce has been on everyone’s radar for some time now, but that blip is expected to get a lot stronger in 2015, thanks in part to the introduction of Apple Pay earlier this year. If ever there was a possible breakout year for mobile payments, 2015 could be it. 

Meanwhile, other potential areas for growth next year include value added services (41%), M2M (34%) and healthcare (21%). 

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