“The GAFA monopoly is increasingly challenged by the stance taken and numerous fines imposed by regulatory authorities, suggesting a re-balancing to the benefit of carriers.”
“When it comes to the economy, data is the new oil,” said entrepreneur Clive Humby in 2006. History has proven him right beyond all expectations. Empires have been built on bigger and bigger mountains of data. Over the course of a decade, GAFA (Google, Amazon, Facebook, Apple) increased their sales from $78 billion in 2008 to $773 billion in 2019. From the outset, GAFA put everything into this new oil, developing data-driven services such as a search engine (Google), online sales (Amazon) and social networking (Facebook). This gave rise to a virtuous circle, as these services became more and more popular. “The more data obtained by GAFA, the more they can hone their machine learning models. The more accurate the data, the better the conversion rate and therefore the revenue,” said Clotilde Marielle, Business Director of Market Intelligence Consulting at Sofrecom.
102% penetration rate
In the face of this competition, carriers have many advantages they can draw on, demanding a place at the data giants’ table. First, they benefit from an unmatched penetration rate: 102% and 5.124 billion unique mobile customers worldwide in 2020 (source: GSMA). As a result, epidemiologists who wanted to study population mobility during the COVID-19 pandemic turned to mobile carrier data, which was deemed to be more reliable than the mobility data disclosed by Google and Apple. The reason? In both cases, the sample was deemed not representative of the population because it was based purely on route searches in the Maps and Plans apps.
Dare to venture into new areas
Carriers can also rely on their privileged relationships with large and small companies, enabling them to develop the B2B market and work on production processes, whereas GAFA mainly hold open data that can be searched online and that is provided by users. The GAFA monopoly is also increasingly challenged by the stance taken and numerous fines imposed by regulatory authorities, suggesting a re-balancing to the benefit of carriers. According to Marielle, carriers should grab this opportunity with both hands and “dare to venture into new areas by making the most of AI.”
Diversify to gather new data
Why not follow in GAFA’s footsteps and hire new budding talent working in AI to diversify? “Carriers won’t make the most money by following the traditional path,” writes Marielle in Sofrecom’s white paper. “Because, generally speaking, there is no real gap in today’s telecoms market. However, by branching into new areas (Internet of Things, banking, etc.) or B2B verticals, carriers have the chance to gather new and more data that will enable them to hold a sustainable place in the market.” Since 2009, Google has invested $4 billion in acquiring AI startups, while carriers have put their money into networks and services.
