MidEast telcos mull alliance to fight socials
Common media platform touted as answer in battle against Facebook et al
A cabal of Middle East telecoms companies is exploring the creation of a pan-Arab online platform, to counter the low margins telcos endure despite increased data traffic on their networks, Reuters reports.
While the scale of the proposal may lead to difficulties with implementation some argue that language and culture alignment across the region together with the webs of GCC-owned affiliates across MENA, could yield success.
"A single operator, even one in multiple geographies and with tens of millions of subscribers, can't create this platform on its own," said Osman Sultan, chief executive of du, the second biggest operator in the UAE.
"It would be restricted to the customers of this operator and wouldn't have sufficient scale to succeed. But a unified platform spanning the Arab world would," he told Reuters.
Sultan said he floated the idea to all major operators in the Arab world over the past year as a means to reap greater rewards from the heavy investments the providers have made in their infrastructures.
Over-the-top (OTT) Internet companies such as Facebook, Google, Apple and Twitter take most of the revenues generated through increased traffic. Telcos have thus far met with little success when trying to convince these businesses to invest in the physical networks that deliver these rewards.
"OTT players...we can't share their gain and they won't share our pain," said Sultan. "Network traffic doubles every eight to nine months, but revenue is heading to a plateau, so we need to claim part of the new revenues alongside OTT players."
Content and services on the new platform would include social media and online shopping for goods and services, including digital content such as music, video and applications, Sultan said.
While operators are tight-lipped on the details of the platform and how it would be implemented, some have expressed enthusiasm for the idea.
"Telcos are beginning to look to the deployment of OTT services such as streamed TV and video-on-demand," said Sheikh Mohamed Al Khalifa, chief executive of Bahrain Telecommunications Co. "Such diversification [into] adjacent industries has become necessary. There are gains to be made by collaborating within our industry in the Middle East."