Docomo Digital Report Looks at Telco Digital Services
Telcos are moving towards digital services as they fight the commoditization of their connectivity services. This is one of the key findings of a new whitepaper “Mobile Carriers Accelerate Digital Services Play” by Docomo Digital, the international payments business of NTT Docomo, one of the world’s largest wireless operators. This move is being driven by pressures on capital expenditure to roll out 5G networks. Given the satellite industry’s desire to be a bigger part of the 5G ecosystem, the white paper offers some interesting findings.
For example, Over-the-Top (OTT) media consumption has spiked, and bundling with OTT providers has been a key strategy for many telcos around the world. The global OTT market size was valued at $121.6 billion in 2019, and is projected to reach $1 trillion by 2027, growing at a CAGR of 29.4% percent from 2020 to 2027. Docomo Digital believes these forecasts are likely conservative given the face of a 134% spike in OTT consumption in the wake of COVID-19 alone.
The report looks at how telcos have sought to diversify revenue streams through service stacks in categories as diverse as mobile bunding, TV and content partnerships, smart mobility, health and wellness, digital commerce, enterprise or home Internet of Things (IoT), 5G, and others. Some have seen success already, while others are on their way, according to Docomo Digital.
“We are witnessing a host of telecom convergence use cases emerging – large operators are partnering with digital service providers and re-positioning themselves as all-in-one connectivity partners. This is increasingly being seen in the form of telco-OTT bundling. The deployment of 5G will further accelerate telcos’ revenue diversification strategy by opening up myriad possibilities, Jonathan Kriegel, CEO of Docomo Digital said in a statement.