Three Trends Causing the Mobile Shakeup in Telecommunications

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Mobile innovations are shaking up the telecommunications industry with more disruptions on the way. Here are three mobile trends that are changing how telecom companies do business.

1. Broadband

In January, more than half (55 percent) of Internet usage in the United States occurred on a mobile device, according to comScore. Mobile devices have become the primary means by which people consume content. As the mobile ecosystem continues to grow, the demand for video and gaming applications and other high-bandwidth content is forcing the telecommunications industry to increase the availability and quality of broadband connectivity.

The growing demand for swift broadband access provides more competitive opportunities for telecom companies, which is playing out in the net neutrality debate. In addition, carriers are exploring more options for meeting customers’ broadband demands, such as wireless broadband (i.e., using your mobile phone as a modem) or combining wireless broadband with Wi-Fi.

2. Targeted Offers

Service providers have a massive amount of data about subscriber usage and digital behavior that they can leverage to offer consumers targeted deals. And as smartphone usage expands, service providers are increasingly using data from their subscriber bases to help marketers deliver personalized ads to mobile users. Verizon Wireless, for example, struck a deal earlier this year with the data management provider Bluekai (now owned by Oracle) and other ad tech firms to help advertisers target Verizon’s subscriber base based on demographics, geography, and interests. Expect more joint ventures to develop between telecom companies and the mobile ad world.
3. Mobile Payments

The mobile payments space is growing rapidly as boundaries continue to blur between marketing, payments, and shopping services delivered via mobile devices. The five-year-old startup Square, which allows credit cards to be swiped by a mobile phone, already has a multibillion dollar valuation. More players, including telecom companies, are also entering the space. China Telecom partnered with about 10 Chinese banks last year to launch a mobile wallet and Philippine Long Distance Telephone Company (PLDT) acquired a 10 percent stake in Rocket Internet, a Berlin-based e-commerce startup, in August. PLDT and Rocket Internet say they plan to develop mobile and online payment technologies and services in emerging markets.   

As mobile transfer and payment solutions become integrated into mobile services, they will increasingly drive buying and usage decisions by customers. This gives service operators an incentive to invest in the infrastructure, partnerships, and technologies needed to leverage mobile payments.

All in all, mobile is on the leading edge of innovation, crossing nearly every industry and sector, and will continue to be a driving engine for growth and innovation within the telecommunications ecosystem.

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