After iPhone, Carriers Must Tool Up For The Capacity Crunch
Mark Giles is an analyst at consulting and research firm Ovum, covering telco service provider strategies and markets.
With an explosion in the amount of traffic traversing their networks, many mobile operators are facing a capacity crunch which is negatively impacting the customer experience.
This has prompted some – such as Telefonica O2 UK, Three and AT&T - to manage the demand side of the equation by bringing an end to
Agree with the points here, however from our perspective another key element would be using more sophisticated traffic management technology to ensure good user experience while moderating the load on the network.
Not all MB are equal – prioritising the stuff that matters (to the customers) minimises both churn and network strain.
You talk about “innovate the legacy” to reduce churn and suggest: “This primarily means providing adequate network capacity and coverage for their customers.”
I suggest this means adding more capacity – I disagree – in the first instance they should look to use what they already have more efficiently and extract more value for those premium customers.
An alternative is to charge for the “application” or service. For example video. This could be packaged with a “premium experience” justification. That bandwidth could be separate to their “standard” data package. So they’re charging for the bandwidth but not linking it to actual bandwidth (going back to the previous comment that users have no concept of 1mb, 5mb, 100mb – they relate it to the activity such as youtube, sport broadcast etc.). I tried to watch France vs Scotland on my phone over the weekend and it was hopeless. Would I have paid £0.50 to get an improved experience….?