The dispute of OTT charge

Absrtact: Foreword OTT charge dispute, the author has done a lot of research and thinking before. At that time was intended to write a "China OTT and Telecommunications Operators competition Cooperation research report." Failed to complete for some reason. Micro-credit card out, there is no time to comment. Just like

Objective

, I have done a lot of research and thinking before. At that time was intended to write a "China OTT and Telecommunications Operators competition Cooperation research report." Failed to complete for some reason. Micro-credit card out, there is no time to comment. Just share some of what you were doing.

1 Research background 1.1 moving tide sweeping the world

A new, all-round, global technological change is taking place. At the end of 2009 Morgan Stanley defined the change as the 5th technology cycle-the mobile internet cycle. The mobile internet is sweeping the world like a wave, much faster than the desktop Internet. Smart terminals (smart phones, Tablet PCs, ultra-extreme and so on), communication equipment, telecom operators, content service providers and other related fields are undergoing great changes; even traditional media, e-commerce, social communication and so on are affected by mobile internet impact and change; User behavior habits are also changing, fragmentation of time is being exploited, Users can stay online anytime, anywhere. The mobile internet will ultimately change the society as a whole.

Mobile wave, the existing industrial chain, the industry pattern will be overturned, market leaders will change. If not prepared early, it will be possible to be the new wave of technology eliminated.

1.1.1 Mobile terminals that need to be redefined

In June 2007, Apple officially launched a new mobile phone to the world, which kicked off the wave of movement. The iphone really extends the desktop internet to mobile phones, and the multi-touch screen brings a whole new design experience, and the App Store model creates a whole new ecosystem. Apple then launched a tablet ipad. The Iphone and ipad ended the era of dominance by established handset makers such as Nokia, Motorola, BlackBerry and Sony Ericsson, bringing a new era-the mobile internet era.

The market for smartphones and tablets has changed dramatically, and the Apple dynasty has been replaced by Samsung and Google's Android system. The direct result of fierce competition is that users are getting more and more easy to acquire new intelligent terminal devices. Today, users only need to spend hundreds of yuan to get a smartphone. The spread of mobile internet is also so much faster than the desktop Internet.

Smartphones and tablets combine the dual functions of traditional computers and mobile phones, and it is not far away for everyone to have a smartphone or tablet computer. Therefore, such terminals need to be redefined, they should first be the computer, then the phone. Michael Selles, the chairman and chief executive of the US micro-strategy company, defines them as "mobile computers" in the "mobile wave-how mobile intelligence changes the world" and will become "the standard global Computing platform".

According to the International Data Company (IDC) released the China Mobile Phone market Quarterly tracking report (fourth quarter 2012), the fourth quarter of 2012, China's mobile phone shipments to 96 million, of which the smartphone shipments of 70 million, an increase of 112.1% per cent, more than expected 103%. Smartphones account for up to 73%. 2012 Annual mobile phone shipments of 362 million, of which the smartphone for 213 million. It is expected that by 2017 China's smartphone shipments will reach 460 million [1].

Chart 1 2011-2017 China Mobile phone Market Shipments forecast sub product line

Source: IDC China Mobile phone Market Quarterly tracking report (fourth quarter 2012)

In global markets, smart phones and tablets have become a major driver of the mobile wave, according to the Global Smart Terminal Quarterly tracker (fourth quarter 2012), released by International Data Corporation (IDC). Data show that desktops, laptops, tablets and smartphones cumulative total shipments of 2012 years to 1.2 billion units, of which tablet computers shipments in 2012 Year-on-year growth rate of up to 78.4%, smartphone growth rate reached 46.1%, smartphone shipments accounted for the total volume of shipments of 60.1%[2 ]。 Smartphones and Tablet PCs have been shipped far more than desktops and laptops.

Figure 2 2012 Intelligent Terminal Market shipments by product and market share

Product Category

2012

Shipments

2012

Market share

2011

Shipments

2011

Market share

Year-on-year Change

Smartphone

722.4

60.1%

494.5

53.1%

46.1%

Tablet

128.3

10.7%

72.0

7.7%

78.4%

Notebook

202.0

16.8%

209.1

22.5%

-3.4%

Desktop

148.4

12.4%

154.8

16.6%

-4.1%

Total

1201.1

100%

930.4

100%

29.1%

Source: IDC Global Smart Terminal Quarterly tracker, February 2013

1.1.2 A world in which everyone is connected is forming

N Nearly 40% of the world's population is already connected

According to the latest data released by the International Telecommunication Union, Global handset users will reach 6.8 billion in 2013, and almost everyone has a mobile phone. Global Internet users will reach 2.7 billion, and nearly 40% of the population is online. Global Mobile internet users have grown from 268 million in 2007 to 2.1 billion in 2013 [3].

According to the China Internet Network Information Center (CNNIC) released the 31st China Internet Development Statistics Report, as at the end of December 2012, the size of China's internet users reached 564 million, internet penetration rate of 42.1% The number of Chinese mobile internet users reached 420 million, accounting for 74.5% of the total Internet user.

Chart 3 China Internet user size and penetration

Source: cnnic,2012 Year December

Figure 4 China Mobile Internet users scale and its proportion

Source: cnnic,2012 Year December

n Social networks become global organisms

Another trend in parallel with the mobile wave is the trend of socialization. Mobile technology is compatible and integrated with social networking technology. On the one hand, mobile technology promotes the evolution of social networks, from the original MySpace, Facebook, Renren, Twitter, Sina Weibo to Foursquare (Check-in), Street, Path (private social), micro-mail, line, singing (voice applications), Pop (picture application) and so on, social applications everywhere. On the other hand, social platforms are becoming the new mobile communications platform, providing users with a new way of communication, such as Facebook, micro-trust, line and so the use of hundreds of millions of users has been to the traditional telecommunications industry impact.

At the user level, as more and more users join social networks, the future is not just for everyone, but for everyone to connect, and social networks will become global organisms.

n always online becomes a normal

Mobile internet has greatly reduced the threshold for users to access the network, smartphones and tablets and the use of various applications to reduce the difficulty of users, greatly extending the user time. More and more users are connected to the net, and almost 24 hours network, this is the development of mobile Internet is inevitable, will become the normal future. A survey by the Ericsson Consumer Research Office found that 38% of Android/iphone users in the United States had already started using their mobile phones before they got up app,18% had already logged on to social networking sites. Instant, live online, always online, these are no longer trends, but have begun.

1.2 Structural changes in Telecom industry 1.2.1 4G is coming

The development of mobile Internet and user experience are inseparable from mobile network technology. 3G, 4G, WiFi and other technologies support the development of mobile Internet. From the first generation of mobile communications (1G) to 2G, 2.5G, 3G, 4G, telecommunications network capacity, transmission speed, stability and quality are increasing.

3G has been able to achieve wireless broadband access or proximity to wireless broadband access, similar to a wider range of WiFi networks. Thanks to 3G deployments, mobile Internet has grown rapidly in recent years. 2009 is China's 3G year, China's three major mobile communications operators 3G Network officially put into commercial. China Telecom 3G adopts the CDMA2000 technology, the Chinese Unicom adopts WCDMA technology, and the TD-SCDMA technology is used (actually 2.5G).

According to the Ministry of Industry and Information technology statistics, 2012 China's mobile phone users reached 1,112,155,000, 3G users reached 232.803 million [4]. China's communications base station has reached 2.07 million, of which unimpressed base station 817,000 [5].

The 4G network is currently being deployed both globally and in China, and a 4G licence is expected to be issued in 2013. 4G has faster speed and better user experience than 3G and can improve spectrum utilization. At present, China's leading 4G technical standard is tdd-lte. LTE, Long Term Evolution, is an IP digital network optimized for data transmission rather than voice transmission. The LTE Evolution report, released by the Global Mobile Equipment Suppliers Association (GSA), shows that as of April 2013, 381 operators in 114 countries are investing in LTE, which is expected to reach 234 global LTE business networks in 2013.

LTE's actual data transmission speed is at least 3 times times more than 3G, so it is more attractive to users with large data business needs. According to Deloitte research, the data used by LTE users in 2012 was 50% to 900% higher than that of 3G user data. The ARPU value of LTE users will also be higher than 3G users because users with high data requirements will be more willing to migrate to the LTE network, while also willing to pay a premium for higher speeds. Deloitte's December 2012 survey of Chinese urban consumers showed that demand for 4G was urgent, with 16% of respondents saying they would switch to 4G first time and 72% of respondents saying they would switch to 4G users [6] within a year.

1.2.2 Telecom market migrating to Data age

The development of communication and Internet industry not only satisfies the consumer's increasingly personalized communication demand, but also contributes to its transformation. In the traditional age of communication, people connect to one voice and text message (SMS) through fixed and mobile phones. The internet provides people with more and richer choices, through VoIP, E-mail, instant Messaging Tools (IM), social networks, network video and other applications, you can achieve voice, text, pictures, video and other forms, one-to-one or one-to-many exchanges. These applications and services are mainly through data transmission, with low-cost, fast transmission, diversified, alternative products and services are very many features, widely popular in the World wide users. These applications and services are built on the basis of telecommunications services and do not require additional support from network operators, and are therefore also referred to as OTT. Skype, Google Voice, Netflix network video, OTT TV (Millet box, Apple ITV, etc.), app stores such as Apple's App Store and all the apps in it, micro-mail, rice chat, MO, etc. are typical OTT.

An increasing number of consumers are turning to cheap OTT first with the explosion of data services, which migrate from the voice age to the data age.

Cisco's Visual Network Index (VNI) monitoring data shows that 2012 China's mobile data traffic is 55395tb[7], equivalent to 14 million a month transmission of dvd,2012 in China's mobile data traffic compared with 2011 growth of 1.8 times times. 2012 China's smartphone each month to generate about 110MB of traffic, 2011 for 72MB. It is expected that by 2017, China's mobile data traffic will increase 17 times times, the annual composite growth rate of 76%. By 2017 China's mobile data traffic will reach 0.93EB per month, equivalent to 232 million DVDs a month. 2017 mobile data traffic is 28,199 times times that of 2007. 2017 each mobile terminal (including machine-to-machine) data traffic will reach 514MB per month, each user monthly consumption of mobile data traffic will reach 847MB.

Cisco Visual Network Index (VNI) monitoring data show that 2012 to 2017, the global mobile data traffic will increase 13 times times, the annual compound growth rate of 66%.

On a global scale, mobile data traffic will grow 13 times times, from 2012 to 2017, with an annual compound growth rate of 66%[8].

Ericsson's survey shows that users mobile terminals 26% time using mobile phone text messaging, telephone functions, 74% time and social and other non-communication services. [9].

The trend of 1.2.3 pipeline intensified

The second change in the OTT of the telecom industry is the increasing trend of the operator's pipeline. Because OTT to the traditional fixed-line and mobile phone, SMS and other services have a strong alternative, consumers are OTT attracted, operators lose the user's control and perception.

Lower ARPU value of 1.2.4 Telecom operators

Despite the explosive growth in data services, global telecoms operators are facing a slowdown in income growth. At present, the traditional voice and SMS revenue of the global telecom operators show a gradual downward trend, but the data flow income has not been significantly increased, and the ARPU value of telecom operators has decreased. There are three factors behind the reduction of ARPU value:

First, the telecom market from the traditional seller's market to the buyer, operators have been difficult to dominate the market.

Second, the flow value is not shifted to the telecom operators but to the OTT, and if consumers use free WiFi to transmit data, the telecoms operators will not receive any money at all. According to Ovum, a market-consulting agency, in 2011, Ott robbed 13.9 billion of billions of dollars in revenue from telecoms operators, accounting for the 9%[10 of all telecom operators ' data revenues.

Third, the traditional business model failure of telecom operators, income and flow loss of relevance. The former mode of telecom operators is the user *arpu value, but now simply using the user * traffic ARPU value mode can not realize the balance between the huge cost and the benefit of the investment infrastructure, the telecom operators need to find a new model.

Chart 5 in the increasingly dominant world of data, income and flow are lost.

Source: IBM Institute of Business Values, 2013

[1] IDC expects 2017 mobile phone market in China will be up to 90.1%, shipments up to 460 million parts http://www.idc.com.cn/about/press.jsp?id=NzMy

[2] IDC reported that, in the growth of the Tablet PC and smartphone market, the global Smart Terminal market achieved 29.1% growth in 2012, and mobility was thus dominant http://www.idc.com.cn/about/press.jsp?id=NzMx

[3] International Telecommunication Union: ICT Facts and Fligures (2013)

[4] 2012 National Telecommunication Statistics Bulletin Http://www.miit.gov.cn/n11293472/n11293832/n11294132/n12858387/15132905.html

[5] An excerpt from the IT Leaders Summit: There is no signaling problem in the 4G era http://www.cnr.cn/life/gdxw/201304/t20130402_512277664.shtml

[6] Deloitte China 2013 ten Trends in technology, media and Telecommunications industry forecast

[7] 1eb=1024pb,1pb=1024tb,1tb=1024gb,1gb=1024mb

[8] Cisco Visual Network Index (VNI) http://www.cisco.com/web/solutions/sp/vni/vni_mobile_forecast_highlights/index.html

[9] 2013 Telecom development 4 trend 4G speed the fastest http://digi.163.com/13/0116/09/8LB58HH100163HE0.html in history

[10] How to enlarge OTT cake http://www.huawei.com/cn/about-huawei/publications/winwin-magazine/hw-196590-hw_196625-127730-125509-hw_196604.htm