Press release: Mobile operators can benefit from offering fixed broadband services but must act quickly

March 2007: Bundling fixed broadband with existing mobile services offers an immediate source of revenue growth, and a number of additional benefits, for mobile operators faced with diminishing voice revenues and a failure to achieve significant growth in non-voice revenue, according to a new report, Mobile Operator Strategies for Fixed Broadband.

Key findings from the new report include:

• Wireless technologies (such as 3G, WiMAX and, in the longer term, 3G LTE) can bring Internet services to the home but, in the short term, DSL is the most effective way of delivering fixed broadband services, even though use of DSL means mobile operators must move outside their core businesses.
• Operators can implement DSL services in various ways, including resale, bitstream access and local loop unbundling (LLUB), and economic analysis reveals significant differences in cost between implementation options. While they focus on revenue growth, mobile operators must ensure that broadband services do not damage profitability.
• LLUB can be significantly more profitable than other DSL solutions - costs can be about 30% lower than those of bitstream access - if operators can achieve significant broadband penetration, although LLUB entails greater investment and risk.

"With their established brands and large existing customer bases, mobile operators have the potential to achieve strong take-up of broadband services", according to Dr Alastair Brydon, co-author of the report. "However, to make any significant difference to their businesses, they need to think big and act quickly in what in many countries is a rapidly maturing market."

 The new report assesses the advantages of offering fixed broadband services and the impact of the services on revenue and profitability. It evaluates the delivery options available to mobile operators, including 3G, 3G LTE, cable, DSL and WiMAX. The report considers DSL resale, bitstream access, LLUB and acquisition of existing ISPs, illustrated by a range of case studies, and identifies the best approaches for different types of mobile operators.