Willetts Unzips Telecom Future

DUBLIN -- Management World 2012 -- Telecom companies who expect to survive the market's greatest inflection point to date will have to shed their risk-averse culture and find visionary leadership. But they will likely face opposition from both short-sighted financial analysts and competition-hungry regulators.

That's the view of TM Forum Chairman Keith Willetts, who actually spells it all out in great detail in his new book, Unzipping the Digital World, being launched here at Management World.

Willetts says telecom will probably have to look outside its current "competent" management to find real visionaries like Apple Inc. (Nasdaq: AAPL)'s Steve Jobs or Amazon.com Inc. (Nasdaq: AMZN)'s Jeff Bezos. Those leaders grew up in companies willing to "taste and try" new things and fail rapidly while today's telecom leaders, says Willetts, tend to be smart folks who have been essentially trained not to innovate.

Pointing to Bezos' decision to open Amazon's platform to third-party retailers as an example, Willetts says that kind of "big punt" is what's needed in telecom today "as opposed to committees who make safe decisions and decide to wait and see somebody else innovate" and then decide to copy them.

But he admitted the investment community presents a major obstacle to any such risk-taking, because financial analysts typically "are measuring the wrong things, trying to see how much more milk I can squeeze out this quarter." Willetts' advice to Wall Street is to instead start looking at how telecom players are investing in key growth areas such as developing services that address enterprise needs.

Willetts conceded, however, that because those growth markets represent a tiny percentage of the current telecom business, innovation isn't rewarded in large companies.

The network business, meanwhile, is already a scale game and that scale is going global in order to both provide the platform for anywhere, anytime services and to achieve the economies of scale required for profits. Yet regulators are still mired in thinking that competition is what will best benefit consumers -- and this will be a major roadblock to the needed consolidation, Willetts says.

"They want 42 providers all running parallel networks and buying expensive spectrum," Willetts says. "They need to move away from the role of smashing great monopolies."

— Carol Wilson, Chief Editor, Events, Light Reading

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