Mark Goldberg

Time to dump the dumb pipes

Fourteen years ago, I wrote a little piece called “From Intelligent to Irrelevant Networks,” which looked at how transport networks had universally delivered high quality, making the choice of long haul connectivity provider largely irrelevant; the most important distinction among service providers was among access providers.

How then would national and global carriers establish differentiation?

A new report from Citi Global Perspectives and Solutions was released last week, “Re-Birth Of Telecoms into a New Digital Industry: Time to Dump the Dumb Pipe” [pdf, 6.3MB].

While telecom operators have seen minimal industry growth of just 0%–3% in the past few years, sectors that use their networks such as Internet Services are seeing growth at rates at least six times higher.

So what’s a telecom operator to do? We believe they have two choices: (1) they can streamline their business and continue providing the ‘dumb pipe’ to the digital ecosystem, or (2) they can embark on a digital transformation.

In the report that follows, we investigate what a digital transformation would entail, how the future post-telecom era digital connectivity industry may shape up, and what it may mean for telecom investors.

The report is a good read for service providers and policy makers alike.

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