Telecoms operators in western Europe must look beyond their debts and define their strategic options now, says a new report released by Analysys this week.
According to the study,
The Future of Telecoms Incumbents, the fourteen incumbent operators had a collective long-term debt of E240 billion at the end of 2001. Deutsche Telekom accounts for E67 billion of this total while France Telecom and the BT group are also heavily in arrears.
Importance of new technology The report suggests that rather than becoming obsessed with reducing their debts, operators should devise strategies to ensure that they are secure and competitive in the future. The effectiveness and profitability of new services is seen as particularly critical to the health of the telecoms industry.
“If GPRS or 3G networks and services do not perform as customers expect, or if costs are higher than planned, there will be huge implications for many incumbents,” said the report’s author, Tamsin Pert.
The European telecoms market grew by 9.5% in 2001 but Analysys acknowledges that it is characterized by unpredictable demand, complicated regulations and a lack of competition. The industry is likely to remain uncertain for the next five years and many operators have already tightened their belts and chosen to concentrate on localised markets.
Nonetheless, whether they are choosing to pursue a global audience or focus on a core domestic market, the report emphasises that incumbents are united in allowing fixed broadband to dictate their strategies and generate revenue.
