Juniper Research recommends that Mobile Network Operators (MNOs) should change their mobile content business models by focusing on ‘shared value creation’ for avoiding ‘dumb pipes’ in the future. If businesses can transform into ‘smart pipe’ service providers then they can increase the income generated from mobile content.

 

Juniper Research (News - Alert) further adds that the global mobile content market will be worth $167 billion by 2013 which will be shared among all concerned parties such as MNOs, content providers, content aggregators and billing companies.

 

MNOs get a big share of the revenues generated by content providers at present, when they use their networks. This leads to high charges to end-users preventing them from accessing mobile content more frequently. This has resulted in lesser revenues for MNOs and content providers. Some content providers even try to bypass the MNOs or leave the sector fully. The report also says that this situation can be changed by efforts from MNOs.

 

The study divided the scenarios facing this sector and operators into Dumb Pipe, Smart Pipe and On-Portal routes. This attempt helped Juniper to get a detailed forecasting and modeling tool for studying the future market and how it may develop depending on conditions then.

 

Andrew Kitson, the author of the report, said: “One single scenario will not win out since different business and revenue models have to co-exist in the mobile content market. Players will adopt multiple approaches that best fit their markets. Crucially, if MNOs are to benefit financially, they need to move away from their Dumb Pipe roots to the Smart Pipe model, though they will clash with the content providers which already dominate the Smart Pipe. A compromise needs to be found.”

 

The report suggests that if MNOs change their focus towards more value creation and support for partners then new changes can be effected easily.

 

Juniper Research also found that under the Smart Pipe model, MNOs will not be able to decipher their mobile content market rise but revenue will increase by 125 percent over the next five years.

 

The On-Portal scenario indicated that content providers will see their market share increase from 54 percent this year to 68 percent by 2013 if they are able to get more benefits from MNOs. Aggregators and billing service providers will be pressurized by larger players like MNOs who will want horizontal integration and also achieve economies of scale.

 

The report includes forecasts taking into account the regional markets and also the global markets. It studies whether the market will grow or not under the On-Portal, Dumb Pipe and Smart Pipe scenarios.

 

The study titled ‘Mobile Content Strategies & Business Models: Scenarios & Forecasts 2008-2013’ can be downloaded from the Juniper Research Web site. Juniper offers research and analytical services to the hi-tech communications sector by providing consultancy, analyst reports and industry commentary.