It must get more aggressive on political and regulatory fronts
As part of its predictions for 2014, John Strand and his team of experts at Denmark’s Strand Consult is urging the GSMA to reinvent itself. Strand says that globalisation is exciting and forces reluctant national regulators to think in new ways. The GSMA is a truly global trade association representing the entire mobile/cellular industry. “It has a vital role to play in communicating to governments and the public,” Strand argues. “The GSMA must be more aggressive on political and regulatory fronts as mobile takes on a greater impact in consumers’ lives.
A key issue where the must step up its efforts is in mobile broadband, Strand thinks.
Mobile operators invest over $100 billion annually in capital expenditure in mobile networks.
The EU used to account for a third of the world’s telecom capex investment, but that number has fallen below 20 per cent.
Meanwhile the USA has held its capex constant at almost a quarter of the world’s total, even though the global pie is getting bigger.
In effect Americans, who comprise just 4 per cent of the world’s population, enjoy one-fourth of the world’s telecom investment.
The European approach with a focus on end user prices and so-called ‘consumer-led’ industrial policy has had a devastating effect across the European continent which now suffers from underinvestment. This proves which regulatory policies work and which don’t.
Strand reckons that the political system must recognise that private companies can’t be forced to make investments if they earn increasingly less revenue.
Authorities shouldn’t congratulate themselves on creating competition because they can simply count the number of players, but not the level of technology.
This is not a call for government subsidies – the telecoms industry has the cash flow to support capital expenditure, Strand admits.
The situation in Europe can be resolved very simply if regulators and competition authorities allow consolidation.
As the internet is increasingly mobile and many choose mobile broadband as their primary internet connection, the GSMA can play a more central role if it wants to.
The GSMA already organises the world’s largest conference for the cellular industry – MWC Barcelona 2014.