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User Rank: Light Weight
1/9/2017 | 5:10:44 PM
usage based billing
Why can't the industry make the transition to usage based billing. If consumers pay for what they actually use, the revenues grow organically as the usage goes up.
User Rank: Light Beer
1/9/2017 | 2:51:39 PM
Re: Profits
The study referred to at Verizon was looking at the backbone costs of transport, not the access, and certainly not 4G and beyond.  The way I think about it is that now the access services (broadband, video, advertising) must subsidize the transport network.  Profits are still generated, but there is incerasing drag on them. 
Carol Wilson
Carol Wilson,
User Rank: Blogger
1/9/2017 | 2:48:00 PM
Re: Profits
The issue is that operators haven't been able to increase the prices consumers pay on a per-bit basis so as consumption goes up but, relatively speaking, prices don't keep pace. Every major operator I know has been discussing this for a while now, it's what fuels the whole SDN-NFV push.

And it gets worse as traffic continues to ramp. Traditional ways of building networks don't allow for the massive scaling needed to handle the growing bandwidth demand. That's why operators want to adopt the same kinds of technology that FB and Google are using - commodity hardware controlled by intelligent software - but they can't do it fast enough. 

So operators are cutting back on capital expenses to preserve their profit margins, and will do so until they have a way to ramp up capacity that is less costly than today's methods. 
User Rank: Blogger
1/9/2017 | 2:40:46 PM
So the implication is that operators are losing money in selling mobile data services (if costs are higher than revenues, you are making a loss). And I don't quite get that as the majority seem to be very profitable companies (even if their revenues and profits are in decline).

I also don't really get the economics. We are led to believe there is soaring demand for mobile data services and always being told about a capacity crunch on networks, which is spurring the need for new technologies and access to spectrum (itself a finite resource). There has been some consolidation in the market, too - even if there is regulatory resistance to M&A activity in Europe. 
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