MATRIXX Software

Predictions: Alternative Business Models for Telcos

Vineet SachdevVP, Product Management

Executive Forum Predictions for 2015, Santa Clara, 16 January 2015

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Traditional Telco Business Under Pressure

Moody’s Negative outlook for EMEA Telcos for the next 12-18 months

Infonetics Europe's 5 largest Telcos continue to experience declining revenue

Ovum Telcos will lose $386 billion (2012-2018) from customers using OTT VoIP

Telefonica Market cap down from $122 to $61 billion in 5 years

Juniper Research

Margins for 12 international Telcos have fallen by 6.4% over a 3 year period

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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Prediction M: M2M

• 50 billion smart objects by 2020

• Telco revenues from M2M will be $25B in 2018

• Revenue opportunities with large enterprises (auto, utility, home automation etc.)

• Upsell opportunities to consumers– Enable shared data for the connected car

Explosive growth in M2M will provide new revenue opportunities

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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Prediction A: Application-aware Pricing

• DSPs will stop treating “all” traffic alike

• A variety of new ways to provide differentiated pricing based on application type and subscriber preference– Subscription-rate certain traffic (such as music streaming)– Day packs for popular applications (Facebook, Whatsapp, YouTube)– Great data on-boarding strategy for pre-paid voice-only consumers

Innovative application-based pricing offers will augment the current all-you-can-eat models

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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Prediction R: Roaming

• Roaming revenues will reach $90B by 2018 ($42B in data roaming)

• 2014 roaming revenues were $57B – hence, significant growth potential

• DSPs will offer new easy-to-understand bundles to promote international roaming– $5 a day to carry domestic voice/data/SMS bundle– X free roaming days per year

Offer innovative roaming packages to promote “always-connected” model while traveling

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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Prediction S: Sponsored Content

• DSPs will learn to make additional money by co-existing with the OTT providers– Amazon– Streaming music/video– Social media

• OTT providers will give new threat to Telcos by providing direct connectivity – Walmart/Target/Amazon– Facebook pre-paid cards– Apple/Microsoft SIM

Sponsored content will gain momentum and provide new revenue streams for Telcos

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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M2M

Application-aware Pricing

Roaming

Sponsored Content

M

A

R

S

Year of Continued Transformation from CSP to DSP

TCSV EXECUTIVE FORUM: PREDICTIONS 2015

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