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Is There Money in Web 2.0?

ECI Explores the Service Provider Opportunity

      

Web 2.0 still represents a big question mark for operators and service providers looking to generate new revenue, says equipment vendor ECI Telecom.


Chairing a discussion on issues surrounding Web 2.0 at the Broadband World Forum in Paris today, Ofer Reviv, deputy general manager for ECI’s broadband access division, believes that operators are still struggling to understand the value proposition of Web 2.0 in the face of increasing competition from Web-based players such as Google, Yahoo! and MSN.

Those players have spawned a series of ‘sticky’ services that analysts believe have created a more compelling experience for users, and operators are looking to follow in their footsteps.

To date, says Reviv, operators have been more focused on expanding their network rather than their service capability and are struggling to increase their ARPUs.

“Deutsche Telekom is investing huge amounts of money in building infrastructure,” says Reviv. “But they have not yet figured out how to make money out of it.”

Nor is Reviv convinced that much-touted services like IPTV represent a substantial revenue opportunity.

“It looks more like a way of driving out competition and preventing churn,” he says.

If they are to fully capitalise on Web 2.0, operators should be looking to imitate the applications developed by the Web players, says Reviv, but at the same time offer a better quality of service -- or ‘quality of experience’ -- to differentiate themselves.

One potential revenue-generating concept that Reviv associates with Web 2.0 is push advertising, whereby an operator exploits the capabilities of the network to determine what content a particular user is accessing and then triggers tailored promotions on the basis of that.

Reviv believes that mobility is one of the of the principal factors driving interest in Web 2.0, encouraged by the migration to IMS architecture and the trend of fixed-mobile convergence.

“Originally IMS was opex-related,” says Reviv. “But if you look at new applications emerging from Web 2.0, the new technologies will allow operators to provide additional services.”

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