Telecommunications is an international industry and many of the companies have a global presence. Although I have no experience working in the sector I follow it closely as a technology enthusiast.
Telecom companies, today, operate like land owners. A network provider only cares about the product they can supply to the end user. All of the other things that go into making the network functional are of little concern and can be handled by someone else.
They are not directly involved in construction,operation or even management of the networks. In order to run their business most “efficiently” nearly all of the functions are outsourced. Although the logic behind this outsourcing is to reduce the prices as well as the risk it would involve to do everything in house, the effect is the opposite. In my opinion.
Spectrum licensing is handled by the government. While I believe that licensing is important, auctions are hurting the industry. But on the flip side without auctions telecom companies can accuse regulators of showing favoritism. So there is no easy answer here. Due to the conditions that exist today huge upfront prices have to be paid for spectrum acquisition, just for being able to use it to provide service.
Equipment is provided by some different organization. There are many providers and depending upon the relationship, the telco may choose one they are most comfortable with. Usually the company that provides the equipment also takes care of installing it and may also enter into a partnership for ongoing maintenance of the systems.
Most of the radio equipment goes on towers. Now these towers are set up and managed by another group of companies. They are known as towerco’s to the industry insiders. They are responsible for acquiring property, negotiating the lease time with the owner, setting up of towers, providing power to the network equipment and keeping the systems protected.
Some smart telecom companies see towers as assets and therefore either create a subsidiary or a separate in-house team to handle the operations related to them. In case the market goes down they can sell these assets to recover their losses and even make a small profit.
Here’s the rub. Consumers don’t care about
Spectrum
Radio equipment
Towers (though they may see them as a threat to their health and may oppose their construction)
On the other hand the telecom companies don’t really control or direct technological innovation, which they should be since they are in direct contact with the customers. They have no control over the government regulations though from time to time they might try their hand at lobbying or press releases by a PR company. If nothing else works some one or the other from the industry might resort to, how should I put it, mutually beneficial arrangement [1].
They certainly don’t have any control over the customers who replace them at the slightest inconvenience. Mobile number portability has completely gotten rid of any loyalty a consumer may be forced into by an operator.
This is the situation that we find telecom companies in. And this is how they are left with no choice but to raise the prices of their data plans, just so that they can feed themselves and everyone else in the chain. Which they try to do delicately because they know that the consumers can replace them at any time.
Now in India we do get to enjoy the cheapest data rates in the world. And I’m mostly satisfied with the performance of local service providers like Jio and Airtel .They have done good work. The Indian government has done good work with its fiber optic connectivity project. Not just with the infrastructure but the services that accompany them especially related to education and administration. Besides cities the coverage has been extended to far flung villages. Great use of cheap wifi technology has been made to make the internet more accessible at a lower cost.
But we need to move away from the practices that are harming the industry. Especially the widespread corruption in overseas OEMs [1]. It may be very tempting to give into the hype in the heat of the moment. But delaying the adoption of trends and focusing on the fundamentals will have a better result in the future. Better speed and improved access at just about the same price. More fiber optic. More wifi. More community networks. More local ISPs. It will not be easy. But we need to find a way.
https://www.fiercewireless.com/wireless/ericsson-plans-to-take-1-23b-hit-for-corruption-fine-q3-2019
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