The biggest threat for operators in trying to move into the OTT space is the venture capitalists. Matt Fischer, a VP at Malaysian Wimax player YTL Communications, said on a morning panel yesterday at the Summit that VCs are much faster and have more resources.
"The rules are changing, and we [telcos] don't even know the rules. The [start-ups] don't have to make money, and the VCs have a portfolio of companies, so it's not an issue if some aren't profitable. So telcos can't compete is this space."
He said for an operator to compete again the OTT players is like winning the cricket championship this year and saying they're gong to win the rugby championship next year.
Incumbents he said are at a disadvantage and have a fortress mentality. Unlike the internet players that make money when they bring traffic in, mobile operators are trying to minimize the traffic on their networks because it costs them money.
He argues that SMS is going to go away and it's just a matter of managing the decline.
The way forward is smart partnerships with the right brands that customers want to use. "The only real tie is brand association."
He joked that operators strength is extracting revenue from customers and hopefully running a decent network.
Operators he feels can play a key role in overcoming barriers to e-commerce as many customers in Asia are reluctant to use their credit cards online.