Strategic Foresight - Insights in Business and Technology

 Big MacTest for  Price Check on Internet Services in Australia  The Big MAC Index test is a well-known benchmarking tool to test the price parity of services across the globe.  Applying the same to high-speed internet available in the UK, New Zealand and Australia, it has become obvious that Australians pay more for similar speed in comparison to the other two countries.   Source: Economist.com

Has Optus on Recovery Path from Cyber Security Attack    Quick Snapshot of the Performance:  Optus is facing multiple challenges, while it was trying to recover from the losses it suffered during the COVID, it was impacted by a data hacking issue in Sep 2022.   This incident has shrunk their brand equity, and customers have lost faith. Hence, 65K customers have churned; in particular, the Mobile business suffered at least in the short term. Optus have recovered from their loss of 65K in 1-2 quarters, which is not only surprising but commendable. It is worth pointing out that the price rise has assisted in cushioning the effect. Having said that, the data hack has impacted their brand equity and has further strained their finances and balance sheet.  Singtel board and exec team need to make a call if they can recover the brand equity or if it is time to rebrand or sell the business or increase its, MVNO or white label, share like Amaysim. Q3 FY23 Story from Numbers  Impact of cyber

H1 FY23 NBN result is worrying for the government.  Reason: The uptake by new subscribers is nearly stagnant at 85Mn connected premises ( same as FY22 ) and is moving at a snail's pace.  With NBNs net growth being negligible, suggesting forces of attrition are at play and with 10K customers switching to Starlink, it is not helping its cause either.  NBN is facing severe headwinds from 5G, Starlink and other fixed-line players, hence there is a twofold push by them. One is to increase the wholesale price and the second is to get regulatory protection from ACC to guard their market share against 5G and other players. Today if NBN is sold it will get a price of $19 to $25 Bn ( the lower end is realistic ) which is less than the contributed equity of $29.5Bn.  The government has committed to the electorate that it will upgrade FTTN/B to FTTC/P and increase the penetration of high-speed internet and make it affordable. Their intent is to make high-speed internet in Australia to be at pa

 Telecom Industry Evolution - 1990 to 2023 elecTelecom Industry Operating Model Evolution - 1990 to 2023 From Linear to Agile Telecom Industry Performance -2023  Telecom Industry Growth - Spectrum  Organic and Inorganic Telecom Industry - Todays Setup and Building Blocks 

 Why the Government had to intervene in Vodafone Idea    Shareholding of Vodafone Idea My previous post on Telecom Industry in India - Oligopoly to Triopoly Source: Ventura, BSE

Global State of Telecom Industry - 2023  

Key Message: Market Size: $2.9 Tn  Growth (CAGR): (6%), Recovering since COVID   Technology Change: High  Life Cycle: Matured Regulation: Heavy  Avg P/E < 15 (no growth), Industry is struggling in generating ROI  Organic Growth: Both Horizontal and Vertical Play are employed  Inorganic Growth: Adapt, Amalgamate, Acquisition  

Key Message: Market Size: $2.9 Tn  Growth (CAGR): (6%), Recovering since COVID   Technology Change: High  Life Cycle: Matured Regulation: Heavy  Avg P/E < 15 (no growth), Industry is struggling in generating ROI  Organic Growth: Both Horizontal and Vertical Play are employed  Inorganic Growth: Adapt, Amalgamate, Acquisition

 Digital Transformation - M2M to IoT  

The Telecom sector across the globe has been struggling, with industry performance in the bottom quadrant.  In Australia, most of them are recovering or heading in the top quadrant driven by the change in demand profile since COVID.  Most telecom companies Beta < 1 (less volatility).   Telecom Opportunity Key Trends Telecom industry across the globe is recovering from being in decline or stagnant in the last 5-10 years. This recovery is driven by the change in demand profile because of COVID. Since early 2020 demand for digital enabled services like self serve, self care, mobile first, remote work and collaboration has grown by 3-5 times. This has resulted in a spurt in demand for data (x3), high speed internet and mobility.   Industry's focus has shifted from Revenue Generation to Revenue Protection and Generation. The Customer engagement has shifted to non negotiable CX (intuitive and simplicity), Resiliency and Stickiness. Fulfilment of this demand is enabled by

NBN - Threats to Fibre Revenue Stream from 5G, Idle Network, Space Technology Driven Disruptors like Starlink and Kuiper    Highlighting > 2Mn services are  <=25Mbps and 82% of services are on <=50 Mbps. Today the avg speed is 52 Mbps Loss Making to Continue for another 2 Years  Disclaimer: All discussed thoughts & opinions are my own & not that of my employer/others

 Why TPG Stock Dropped after FY 22 First Half Results - Quick view

Telecom - OSS and BSS Leading Systems Capability and Positioning   

 Telecom Industry Australia - Where the Money will be Spent in the next two to three years. My other post on "IT Services Opportunity and Spend Profile in Telecom sector" can be read here Disclaimer: All discussed thoughts & opinions are my own & not those of my employer or other parties.

 What NBN Co Needs to increase the uptake of high-speed internet - Follow the Kiwi Model Comparing the typical RSP price point between  NBN Co  and Chorus NZD (Fibre Wholesaler), NBN Co lacks not only price parity and affordability but also the avg speed and higher speed tier simplicity. The new SAU proposal by NBN Co is a good start. Reducing the price by $5 to $10/month on 100 Mbps to 1Gpbs lacks the imagination and will to spur digital growth & intake of high-speed internet. It appears to be shackled by the serviceability of $27 Bn debt for any aggressive pricing & cost relief.  Open Reach is following a Simpler High-Speed Tiering model with Economical Pricing like  Chorus NZD . In terms of Fibre Access type, it is leveraging FTTC, FTTP (Gfast) & EE (10Gbps) for Enterprise. More than 360 Retail Service Providers in play

 

 Why SD-WAN is becoming a battleground for Wholesalers, Telecom Operators, RSPs and OTT Players Source: Gartner

Telecom State of Play and Growth Areas - 2022  For background on Why Telcoms are struggling please read my POV in 2012 -  Why Telcos are Endangered Species

In a country like Australia, most industry verticals follow 3 or 4 pillar models like Banking (CBA, NAB, ANZ, Westpac), Retail (Coles, Woolies, Aldi), or Mining (BHP, RioTinto, Fortescue) Telecom Industry is heading towards a 4 pillar model. Since most industry verticals are in oligopoly, products & services are priced as status quo or skimmed, and economical pricing is missing in most cases, resulting in higher prices for consumers & higher cost of living. Besides, key players are opting for decentralization to grow and find new revenue streams.    

Telecom Cloud has evolved from an early infrastructure offering to a solution-centric and to being an aggregator.  Telecoms are struggling to get ROI in this domain while the sector is still growing by 30-35% YoY.  Players Like AWS, MSFT, Google, Dell (EMC/Vmware), IBM and others are not letting Telecoms to play in this space. Besides Telecoms with so many customer-centric assets are struggling to refine their operating model to take advantage of the cloud to diversify and increase revenue.   Telecom Cloud (Distributed) Use Cases  Cloud Infrastructure Services Market - 2022 Why Cloud Cloud Sales Roadblock