Telecommunications industry at cliff’s edge, Time for bold decisions

Daniel Boniecki, Chiara Marcati, Wajih Abou-Zahr, Tarik Alatovic, Omar El Hamamsy, Telecommunications industry at cliff’s edge, Time for bold decisions, 2016

The telecommunications sector in the Middle East and Africa (MEA) is in the midst of a decade of strong growth and investment, driven by a technology explosion and strong demographics. The region now claims 8 percent of global telecommunications revenues and 19 percent of economic profit. For the six-year period ending in 2015, the region averaged around 3.5 percent growth annually, far outstripping the global average of 0.3 percent. Well over half of this growth (53 percent) has been attained in low-income mobile-only countries, mostly through increased penetration. The next chapter of telecommunications will be defined by exploding data demand. A huge potential will be captured by operators who, by making smart investments in the core business of connectivity, will become intelligent network operators. This will require a much more segmented and targeted approach as the economics of data are much tougher than those of legacy voice business. While there is no one story for every player, there are at least 5 levers which CEOs should evaluate when crafting competitive advantage for the next decade. Varying flavors of advanced analytics, video and “over the top” content, consolidation, new operating models and digitization will separate winners from troubled assets. Those late making choices or short of financing investments will soon find themselves unable to compete.

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