Strategic Scenarios for Fixed-Mobile Convergence

Abstract

This study demonstrates that an integrated operator can benefit from cost savings, customer retention and prevention of revenue erosion by having a fixed-mobile convergence (FMC) migration strategy including introduction of advanced service packages. This development is driven by increasing importance of mobile network capabilities and services, as well as the decreasing gap between fixed and mobile systems, in terms of technological models and prices, making FMC both requested by the market and commercially feasible to provide. FMC is expected to offer benefits for network and service operators as well as businesses and consumers. The authors have analyzed the operator’s dilemma on proper migration strategy in exploiting the benefits of cost savings and generating new revenues, but exposing oneself to the risk of substitution effects among its fixed and mobile products. They provide quantitative comparison of some strategic scenarios utilizing techno-economic case study methodology in modeling an integrated operator business in a Western European context.