Joint study identifies key strategies for mobile operators.
Ericsson and Ernst & Young have identified three strategies adopted by the most successful mobile operators.
Identified as ‘frontrunners’, companies who saw revenues grow at 9.6 percent between 2010 and 2014 were found to have driven growth through a focus on quality, quick adaptation to market conditions and unique offerings.
A "quality-led" approach might invest heavily in improving the performance of the network and will feature this heavily in branding. Operators focusing on this approach saw 36 percent revenue growth over the five-year periods.
Operators using a "market-led" approach identified particular segments of the market and provided tailored offerings, while an "offering-led" approach used uniquely designed offerings to differentiate.
The report also found that the size of an operator and its position in the market were not strongly correlated with its innovation and revenue growth.
The study reads: "By observing frontrunners over the same timeframe and focusing on their market position, we see that they are found in both market leader and challenger positions. In fact, in 2013 the majority of frontrunners were positioned third in their respective markets.
"We have found no direct correlation between being a frontrunner and the size of an operator’s subscriber base. The frontrunners in the study have between a few million and hundreds of millions of subscribers.
"This indicates that profitable growth can be achieved regardless of market size or position, and that smaller markets with fewer subscribers pose no hindrance to becoming a frontrunner."
Martin Sebelius, Executive Director of Nordic Advisory, EY, says: "We clearly see that despite their different strategies, frontrunner operators share a common commitment to network quality. Not surprisingly, Frontrunners constantly seek new ways of challenging industry conventions to make connectivity more relevant to people, business and society."
Patrik Cerwall, Head of Radio Strategic and Tactical Marketing, Ericsson, says: "We wanted to understand what makes operators successful in order to be the best partner to our customers.
"It may sound self-serving, but Frontrunners focus on growth, both enhancing the core business while at the same time exploring new markets and capabilities to secure future revenues, such as IoT (Internet of Things) and vertical solutions."
Cerwall concluded: "The journey toward 5G in 2020 will be marked by both new technology advances and new business models, but that transformation really started with the shift from voice to data-driven networking. The operators who are managing that transition successfully may provide the blueprint for success in 5G."