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INDUSTRY NEWS


16 May 2008

Global telecoms market set for change


The next five years will see the telecom market change dramatically as a result of "structural separation", the deconstruction of carriers' vertically integrated business model into a horizontal one, it has been claimed.

According to Gartner, regulators will increasingly attempt to intervene and break up the vertically integrated business model in order to encourage competition and stimulate investment, something that is being seen in countries across Europe.

"In the past 20 years, carriers have increasingly focused on operational efficiency – via a tighter coupling of business assets (vertical integration) – to compete more effectively against new market entrants with lower cost structures," said Alex Winogradoff, research vice president at Gartner.

With technological progress in the telecommunications industry quite slow, particularly in terms of internet infrastructure, Mr Winogradoff went on to explain that many regulators consider vertical integration the primary reason for lack of progress.

According to a new report from Multimedia Research Group (MRG), telecoms companies have benefited this year from moving into the internet protocol TV (IPTV), space, with the number of global subscribers expected to rise from 24.4 million in 2008 to 92.8 million by 2012.<br/>

© 2006 Adfero Ltd.

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