Are we witnessing the demise of the Telco?

The FT recently reported that AT&T is circling around DirecTV, the largest satellite-TV provider in the USA. It’s a potentially enormous deal of around $50bn that analysts predict might shake up the pay-TV market in the States, but why would a Telco be looking to buy a satellite TV provider?

Well, just look at what is taking place all over the world. Broadband and fibre speed are dominating business planning and there is more of an emphasis on the content that can be pushed across a network rather than just the calls.

Here in the UK, BT is another great example of this change. Their strategy today is very much focused on their BT Sport product. In just a couple of years they have become a major player in the British pay-TV marketplace by scooping up rights to broadcast prestigious sporting events – including many Premier League games.

And Vodafone has been seen talking to Netflix. Where will it end if the telcos are all exploring how to create premium content rather than trying to sell us bundles of call time?

I predict that we may see a very different future and one that needs quite a big shift in strategy for the telcos. I expect that there will be lightning-fast fibre networks that customers can connect to anywhere – no more roaming charges as you hop around from one carrier to another.

It is a vision that’s very attractive for the customer. A group of telcos that just exist as one to provide access to the Internet, but with the customer fairly agnostic about how their device actually connects. But this means that the real future for the telcos will be in the content they can create – the sport, the movies, and the original programming that a service like Netflix is now creating.

The telcos are going to stimulate the use of their network by creating great content that we all want to consume.

Do you agree? Leave a comment here or tweet me on @simondillsworth.

House of Cards


Photo by Atin licensed under Creative Commons

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