Tony Lavender, Dan Bieler
Impressions from CeBIT
As we do every year, we spent a couple of days at CeBIT, the world's largest ICT trade fair, held in Hanover, Germany. In our view, the main trends are that the Asian ICT players are pushing onto the market with a vengeance; home entertainment is gradually becoming a tangible concept; and next-generation network planning is taking hold.What is striking when one strolls down the aisles is the presence of Asian ICT manufacturers and service providers. It is not only the South Korean and Taiwanese handset and HDTV manufacturers that make their presence felt. There are Chinese network infrastructure providers, Indian software providers and many more. The consumer products especially convince through their design. We believe that alarm bells should be ringing in European ICT players' HQs. In our view, it is highly dangerous to underestimate the competitive threat that is growing in Asia.Home entertainment is present everywhere at CeBIT. It might well mean different things to different people, but service providers and manufactures are jumping on the bandwagon. Despite the emergence of new devices and software solutions to support the trend, we feel that a key challenge remains the task of convincing the customer to switch from the existing set of "separate" services often with different providers, to one bundle with just one provider. Price discounts seem the most obvious selling point. This is unlikely to support significant sales and margin growth, however. Also, we remain unconvinced that telcos make the best content managers. Thus, IPTV or gaming might not prove to be the solution to the danger of telcos turning into "dumb-pipe" providers.The migration towards next-generation networks (NGN) is in full swing. We saw endless IP-based network infrastructure solutions - and of course IP-based end devices. In particular, the spread of VoIP to a mass market is almost given as a forgone conclusion (although some companies still prefer the ostrich approach to dealing with VoIP). Whilst we have no doubt that NGNs will become a reality over the medium term, we also see that regulatory uncertainty, in particular concerning IP interconnect and interoperability (affecting QoS, SLAs), hamper the uptake.Perhaps most worryingly, we find it increasingly difficult to see a "natural role" for traditional telco service providers. Their turf is under attack from many different directions. Despite a lot of rhetoric, we see them struggling to find a role in the convergent marketplace. The big question must be: "where can they add more value than others could?" The answer might well be, "in network infrastructure management". This is not an answer they like to hear, as it has a distinct "utility" flavour. Yet, few would disagree that the future of ICT depends crucially on quality network infrastructure. With a sensible interconnect regime for NGNs, network infrastructure management might turn out to be a lucrative area to serve after all. But it will take a significant shift in self-perception on behalf of the operators to get there.
