A third way out of the content puzzler

Johan Khoo, Quentin Derome, Matt Marolla
21 Jul 2011

Mobile internet access in Asia is growing more rapidly than any other communications technology. This trend is augmented by the ramp up of next-generation broadband in Malaysia and Singapore.

Despite this network build-out, industry analysts estimate a $50 billion gap in internet ad spend, showing that companies are currently under-monetizing their assets. Those that can capitalize on the shift towards a digital lifestyle will outpace the competition, especially in Asia, where mobile is dominant.

Delivering an exciting, integrated media offering will be the critical differentiator for operators and content providers. However, the industry must undergo a costly and complex convergence. Furthermore, IPTV and over-the-top television (OTT) are disrupting traditional TV business models, threatening to take market share from telecom operators. Finally, the industry lacks a compelling solution to monetize customer interactions.

Is there an innovative way for telecom operators and content providers to sustain future growth while aligning their services to new monetization opportunities?

Communications and media convergence has historically been driven by large mergers, along with ambitious organic growth programs. Yet, communications operators are facing financial and operational challenges as they attempt traditional content strategies.

The cost of acquiring premium content can also be prohibitive, as we saw with the English Premier League broadcast rights awards in Europe and Asia. IPTV and OTT services are also disrupting the TV landscape by enabling content providers to position themselves closer to viewers, bypassing traditional players to directly offer “a-la-carte” subscription and hybrid options.

New regulation can further disrupt an operator’s plans to differentiate with exclusive content. In Singapore, regulators are seeking to make exclusive premium content available to all operators at a fee through “cross-carriage” and Project NIMS (next-generation interactive multimedia applications and services). Such initiatives benefit customers by permitting access to content without switching providers.

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