Ringing in a New Era of Growth for Wireline Telecom

摘要

While the telecom industry as a whole is yet again on a path to positive growth, the financial markets remain skeptical about the opportunity for revenue growth in the mature wireline sector. Today, carriers face a host of inescapable industry issues, as well as fundamental challenges inherent in their traditional business models. Above all, wireline carriers must simultaneously address the dual challenges of: 1. Building Internet protocol (IP) and digital media network services and platforms for top-line growth in the face of competitive substitution 2. Managing down the costs of legacy parallel networks, processes, and IT systems. Wireline carriers face substitution from wireless cellular and broadband, cable companies, and IP. In a dynamic, cannibalistic market, they must find ways to address these challenges, while responding to external market pressures and transforming their legacy business models. To succeed in a market increasingly characterized by the need to provide services on demand, wireline carriers must improve their market responsiveness, flexibility, and operating efficiency, thereby achieving the dual objectives of top-line growth and overall cost base reduction. They need to position the fixed, wireline business as a key part of the network fabric where it coexists, supports, and also competes with other networks and technologies. Wireline carriers may update their business and operating models through key on demand transformation initiatives, in the process creating the scope for 20 to 50 percent improvement in free cash flow (FCF), with one-third or more coming from revenue generating initiatives. These on-demand initiatives can build the capabilities for longer term financial performance and reinvestment in network transformation to drive new revenue growth.