Impact of Over-the-Top (OTT) Services on the Telecom Companies in the Era of Transformative Marketing

Abstract

Due to digitalization today, we are more connected than ever before in human history. Access to the Internet has increased from 16 million in 1995 to 4157 million users by the end of December 2017. The industry which helped humanity connected and made the world a global village is the telecommunication industry. However, today the telecom companies are facing revenue losses; for instance, revenue of value-added services of telecom companies in Pakistan has reduced from Rs 5861 million in 2012 to 236 million by the end of 2017. Similarly, because of WhatsApp, Skype and Messenger usage, the long-distance call and SMS revenue of telecom companies in Pakistan have reduced from Rs 47,969 million in 2008 to 19,555 million at the end of 2017. With the empirical evidence from Pakistan and the literature from all over the world, this overview research paper summarizes the issues of the telecom sector and suggests a way forward to help the telecom companies to come out of this situation. For review paper, official telecom regulatory reports and GSMA reports have been referred. This study concluded that, on the one hand, telecom company’s revenue is decreasing and, on the other hand, it is bringing enormous opportunities to the companies. Telecom companies can get the benefit of changing customer preferences’ by understanding customers’ requirements, producing and selling Internet and digital value-added products and services in parallel with traditional telephony services