DSL rollout essential for mobile operators

In order to compete with quad-play offers, mobile operators have been advised to roll out fixed broadband

Mobile operators need to roll out fixed broadband with their mobile services as soon as possible, according to a new report from telecoms research firm Analysys.

Analysys’ report identified two reasons for this recommendation: firstly, “many operators are finding it difficult to achieve significant average revenue per user (ARPU) growth in their core businesses of mobile voice and mobile non-voice services"; secondly, many firms not normally associated with comms provision are offering "a one-stop shop for fixed telephony, internet access, mobile telephony and content (such as digital TV)". These triple-play or quad-play offers could entice valuable customers away, Analysys warned.

The research firm identified digital subscriber line (DSL) technology as the most appropriate system for fixed broadband in the short term. However, the size of the mobile operator will dictate how they would utilise the technology. Analysys outlined three DSL strategies available: resale; bitstream access; and local loop unbundling (LLU).

"Operators are likely to choose different solutions, depending on their size and level of integration with fixed operators, as well as on the regulatory and competitive characteristics of DSL in particular markets," explained Analysys.

In the long term, mobile operators need to check how 3G long-term evolution (LTE) and WiMax rollouts are proceeding, and whether the advantage of being able to offer fast connectivity while simultaneously being “mobile” would justify a price premium for these services. However, Analysys warned that any such price premiums “[may not] be competitive if fixed networks evolve substantially, for example with the deployment of very high speed DSL (VDSL) and fibre to the home (FTTH)".

The report is titled Mobile Operator Strategies for Fixed Broadband and is authored by Sound Partners CEO Alastair Brydon and research director Mark Heath.