Is it curtains for the fixed line operators?

Fixed line operators suffered an eye-watering 55% drop in actual revenue between 2000 and 2010 with an equally dispiriting 37% decline expected between 2010 and 2016. The IBISWorld report “Top 10 Dying Industries” published in March of this year puts wired telecoms carriers at the top of the list.[i]

What is behind this doom and gloom? The key reason for this dismal performance is VoIP. The report states that the fixed line operators “are generating lower returns each year as consumers switch to VoIP and wireless products.”

Is there any good news at all? However, before operators start to turn out the lights and vacate their buildings other research suggests that things are not so bad. The report states:

“Although these industries are all facing negative numbers, the operators in them aren’t necessarily on the brink of death”…” “Firms that protect their strength in certain market segments, focus on niche opportunities and capitalize on the dwindling number of competitors can often reap the greatest rewards as sole operators, obtaining market survival and profitability.”

A new report from Standard & Poor’s also says that the costs of fixed line operators were being reduced more successfully than mobile operators because of the transition from legacy networks to IP and fibre.[ii] Other positive data indicators come from PointData who state that residential VoIP subscribers increased 19% in 2010 to 157 million worldwide who also forecast over three quarters of a billion fixed line broadband subscribers by the end of 2015.

What can fixed-line operators do to turn all this into a revenue-generating opportunity? Simply put, innovate their services to meet the needs in the market. For example, it is standard practice, and will be for the foreseeable future, for businesses to maintain a fixed-line contact number. In the case of small businesses or sole traders, wouldn’t it be ideal if their business fixed-line could ring their mobile phones and even their laptops, so that they could take calls while in the field?  It would free them from maintaining an office presence and relying on voicemail, and they would never miss a call.

Creating solutions like this is what keeps us busy at Jinny Software. To learn more about how we can help you drive profitability by leveraging your core network assets onto the PC screen and other mobile devices, read on.


Author: Mahesh Patel, Jinny Product Manager