Abstract
The Internet's leading companies have enjoyed a stunning rise (traffic, net
revenues), and have established themselves as powerful brands, thanks to a
handful of extremely popular key services. Their business models rely a great
deal on advertising services and distribution, for low per-unit margin but
high volume markets.
So these Internet giants are working to be as big as they can, by offering an
array of (possibly free) appealing services. They are battling it out chiefly
amongst themselves in the services market, seeking to gain a greater share of
the pie, while also destroying rival services' value by offering certain paid
services for free, or at drastically reduced prices. This ongoing battle of
the Internet giants is not without consequences for the telecom industry.
Concerned with creating new revenue streams, telcos can either elect to
develop their own service offerings directly, or to join forces with Internet
portals and act as intermediaries. These partnerships offer real
opportunities, albeit varying depending on the nature of the service. The
leading telecom operators, and mobile operators in particular, have been
adopting very different approaches.
But portals' appetite goes well beyond fixed and mobile services, and the
Internet giants could well prove a direct threat to telcos' longstanding
access-centric business model. Recent developments are in fact allowing them
to launch full frontal attacks on the Internet access (virtual operators,
Wi-Fi), voice (VoIP), TV and mobile access (MVNO) markets.
Key questions:
- What is the Internet giants' current revenue model, and how will it evolve
?
- Will web portals' advertising model be viable in the long term ?
- What are key services for Internet portals ?
- Can advertising finance all the services ?
- Why and how are portals competing with one another ?
- What impact does the battle of the portals have on telcos ? Can telcos
come out winners by collaborating on services with one or several of the
Internet giants ?
- Are portals capable of threatening telcos' traditional access-centric
business model ?
- How different is the situation in Western Europe,the US and in Asia
(China, South Korea, Japan) ?
- In terms of portals ? In terms of fixed and mobile telecom markets ?
Who should read this report ?
Internet players
- Understanding service operators' positioning and strategy
- Assessing the competition's service developments, notably in partnership
with operators
Telecom operators (fixed and mobile)
- Understanding Internet players' global strategy
- Analysing partnership possibilities with Internet players
- Assessing the nature of the threat that portals pose to traditional
business models
Equipment manufacturers (consumer devices)
- Gaining an understanding of the stakes and challenges involved in
distribution for Internet players and telcos
- Tracking the services market's chief stages of evolution
Investors and analysts
- Analysing the overall state of competition, in Asian markets in
particular
- Understanding Internet players' true impact on the telecom market
- Anticipating upcoming trends in portals and telcos'ecosystem,
particularly with the advent of Web 2.0
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