The Impact of Over The Top Service Providers On TH

The impact of Over The Top service providers on
the Global Mobile Telecom Industry: A

quantified analysis and recommendations for
recovery
Ahmed Awwad
Faculty of Science and Engineering, Anglia Ruskin University, Cambridge Campus, East Rd, Cambridge CB1
1PT, United Kingdom.
[email protected]
Key words: Mobile Network Operators (MNO), Over the top (OTT), Telecom industry revenue decrease,
telecom operator’s revenue growth strategies.
This work is licensed under Attribution-NonCommercial-NoDerivatives 4.0 International (CC BY-NC-ND 4.0)
ABSTRACT
Telecom industry is significantly evolving all over the analysis of global MNOs` revenue over the last
globe than ever. Mobile users’ number is increasing decade. Additionally, the research aims to compile,
remarkably. Telecom operators are investing to get evaluate, and analyse set of former proposed
more users connected and to improve user strategies for MNOs to overcome the OTTs` impact.
experience, however, they are facing various Methods –Referring to available open source raw
challenges. Decrease of main revenue streams of data collected from GSMA and official
voice calls, SMS (Short Message Service) and LDC telecommunications regulatory authorities
(Long distance calls) with a significant increase in data worldwide, the research develops a statistical model
traffic. In contrary, with free cost, OTT (Over the based on regression and extrapolation to analyse the
top) providers such as WhatsApp and Facebook global MNOs` revenue trend.
communication services rendered over networks that Findings – This study reveals a hidden revenue loss
built and owned by MNOs. Recently, OTT services for global telecommunications industry represented
gradually substituting the traditional MNOs` services in all MNOs all over the world. The study corelates
and became ubiquitous with the help of the the hidden revenue loss to OTTs evolution. The
underlying data services provided by MNOs. The study finds out that SMS is the most impacted
OTTs` services massive penetration into telecom traditional service of MNOs and predicted that it will
industry is driving the MNOs to reconsider their vanish at quarter 4 of 2022.
strategies and revenue sources. Recommendations – MNOs to apply 4 different
Objective – The research objective is to critically strategies varying from competing to partnering with
evaluate the impact of OTT providers on MNOs. OTTs based on the services overlapping level and
With the empirical evidences, the research explores a OTT size. MNOs need to target OPEX and CAPEX
quantified impact of OTTs on MNOs main revenue reductions and develop their own multi-functional
streams, and breakdown this impact to highlight customer-oriented OTT application.
effect`s significance. Followed by a statistical trend
I Introduction
I.I Background
Last decade has witnessed a revolutionary development of global mobile telecommunications industry while playing
the crucial role in empowering people, triggering positive change in business processes and in the global economy
with 4.1 $ trillion contribution in GDP (Gross Domestic Product) at 2019 as per GSMA (2020a). Mobile users’
numbers are increasing significantly day by day and generating tremendous increase in network’s load and traffic.
Pursuant to GSMA (2020b), the unique number of mobile subscribers has reached 5.2 billion at April 2020,
meanwhile Worldometers (2020) reported 7.77 billion world population during the same month, that means out of
7.77 , 5.2 are mobile users, with a users` penetration rate reaches 66.9 % of mobile telecom industry represented in
MNOs (Mobile Network Operators) around the world, notwithstanding, the MNOs` revenues are declining.
The barriers to entry to telecommunications market have been lowered due to the widespread adoption of mobile
internet access (Fritz et al. 2011), specifically with the 4G (4th Generation) mobile technology advancements in
telecom industry, OTTs (Over The Top) have entered the market (Legere 2018). OTTs refers to the mobile data
services that carried over the MNOs` networks (Minges and Kelly 2018). Those OTTs make use of MNOs’
infrastructure and internet capacity rather than creating their own networks (Valipour and Hosseini 2017).
Furthermore, OTTs have succeeded to shift the users from using MNOs` services towards OTTs (Esmailzadeh
2016). Whilst incumbent MNOs battling to churn those users back, OTT providers steadily keep growing their
customer bases and revenues (Infopulse 2019).
The user`s shift to OTTs caused a decline in traditional services offered by MNOs including domestic voice calls,
text messages and long-distance calls, accompanied with a disruptive data traffic increase (Minges and Kelly 2018)
and (Cisco 2018). That resulted into a declining trend of MNO’s traditional revenue streams (SMS and voice) (Cisco
2018), while OTTs are developing with an extensive increase in revenues (Ouyang et al. 2018) and (Sujata et al.
2015). On the other hand, this enormous increase in data traffic is forcing the MNOs` investment directions towards
expanding their network`s capacity to accommodate the increase in traffic while maintaining good level of customer
experience (Czarnecki and Dietze 2017). In this challenging situation, MNOs have to revise their strategies to keep
competing with OTTs, as these OTT service providers increasingly substituting traditional telecommunications
services due to their alternative offered services (Trask 2018).
I.II Problem statement
The 66.9 % penetration rate of telecommunications industry reflects its value and urge to explore its major
opportunities and potential threats in order to keep this industry flourishing. Mobile telecommunications industry
is confronting several challenges in this disruptive decade. Immense surge in mobile networks` data traffic due to
the proliferation of smartphones penetration and the emergence of data-based applications (Cisco 2018), which
necessitates the MNOs` networks expansion in order to sustain the quality of the increased traffic (Czarnecki and
Dietze 2017). In spite of the massive subscribers’ numbers increase and data outgrowth, the revenue growth rates
and the ARPU (Average Revenue Per User) MNOs` trends are declining (GSMA 2020b), which means, MNOs are
not able to monetize their investments. Meffert and Mohr (2017) predicted 15 to 30 % revenue loss, if MNOs will
only expand and modernize their network without additional recovery strategies.
The content and services offered by OTT providers in today`s world like Facebook, Whatsapp, Spotify and Netflix
became part of every day’s life of billions of people all over the world, those services rapidly acknowledged by tech-
savvy millennials who were born mainly from 1980`s to 2000`s (Krämer and Jalajel 2019). This whopping rise of
gargantuan OTTs have absorbed a large fraction of MNOs` services traffic (Krstevski and Mancheski 2016) and
might have resulted into massive reduction in MNOs` revenues (Sujata et al. 2015). The traditional voice and
May 20, 2021: Preprint submitted to ArXiv Page 2 of 28

messaging traffic of MNOs have been replaced by data traffic, which is generated from using the OTT applications
in which customer can access premium functionalities with a subscription fees to OTTs however the basic features
are with no cost. Users are still paying for data consumption usage to the MNOs but OTTs using freemium model
at which they utilize the MNOs networks without paying to them, so they generate high revenues (Minges and Kelly
2019). Core services of MNOs are shrinking, as a result of the traditional transport and access business becomes
negative, which may fail to achieve the broadband goals (Knoben 2015). In 2017 MNOs have generated 1.3 trillion
Euro compared to 402 billion Euro from OTTs, however the OTT growth by a CAGR (Compound annual growth
rate) 2012-2017 of 17.3%, MNOs only 2.6% (Knoben 2015).
MNOs` ARPU is driven down with the rise of OTT services` popularity. As shown at Figure 1 (amended from
GSMA 2020b), the mobile user’s number is enormously
growing, unlikely, the ARPU is decreasing, which means
MNOs are not able to monetize the increased numbers in
subscribers. Even though the subscriber’s number increased
by 83% comparing 2009 to 2019, the revenue has only
increased by 32.67% and ARPU has fallen down to $ 13.56 at
2019 compared to $ 22.39 at 2009. Knoben (2015) warned that
revenues from core MNOs access and transport services are
declining, and urged MNOs to look for new sources of income
Figure 1. MNOs subscriber’s vs APRU trend (amended from GSMA 2020b)
while the OTTs are stepping inside the value chain and causing
a fierce competition, the MNOs current investments in ultra-fat reliable infrastructure may fail to achieve the policy
goals. This protrude an earnest issue happening with the MNOs. MNOs are rethinking their business models and
attempting to reinsert back the traditional telecom services into the current telecommunications equation (Athow
2015). This challenge engenders a substantial pressure on MNOs to recoup the revenue loss if it is relevant to OTTs,
and to review their stagnant strategies in order to monetize their ongoing investments (EIU 2018).
Recapping the problem; the mobile users’ numbers are significantly increasing. Despite this increase, the revenue
growth rate and ARPU are falling. Which means MNOs are not able to monetize their investments that includes
infrastructure expansion to accommodate the traffic increase generated from the increased mobile users’ numbers.
Disability of MNOs to monetize their investments will results in deteriorating the industry and leave the 2.5 Billion
unconnected people in the world offline. The emergence of OTTs can be a major factor in impacting the
telecommunications industry, OTTs are using MNOs` network infrastructure to deliver services to users that
replaces MNO`s services and cannibalizing traditional MNO`s revenue streams. Due to the quick embracing of
OTTs in society, the MNOs are being reactive and slow till now to deal with the OTTs impact which soars the
problem more and develops innovation backlog of MNOs against OTTs.
I.III Statement of purpose
Several researches have attempted to examine the OTTs` impact on MNOs from various perspectives; nevertheless,
this impact was not quantified neither corelated. This research takes a cognisance of the impact of OTTs on MNOs
from revenue perception. Additionally, the research compares MNOs vs OTTs trends of LDC, Voice calls, SMS
and traffic which illustrates the impact on MNOs from OTTs. The research acknowledges the MNOs` data traffic
increased with OTTs evolution which has given rise to MNO`s revenues, though not to the same revenue level they
used to earn from traditional services as LDC, voice calls and SMS. To analyse these variations of the mobile
telecommunications industry revenue along with the introduction of OTTs, the study targets the period from 2009
till 2025 where it is divided into 3 phases as shown at table 1 (personal collection). Phase I is the prosperous era of
the industry when it recorded the highest revenue growth rate. Phase II is the recent era which witnessed the
evolution of OTTs with a decreasing revenue growth factor of MNOs. Lastly, Phase III is the future era. The
research takes advantage of MNOs phase I`s success as a reference baseline to reveal a quantified revenue loss at

phase II, furthermore, recommend a two-dimensional strategy for MNOs to contain the OTTs impact and to
prevent the loss at phase III.
Phase I Phase II Phase III
From To From To From To
2008 2013 2014 2019 2020 2025
Table 1. Research`s period scope (personal collection)
Revenue loss quantification gives an explicit view of the direct impact occurred by the OTTs, after corelating the
loss to them. Also, it urges the regulators and MNOs to push forward on carrying out former proposed researches`
strategies to compete with the OTTs, or strategies to regulate the OTTs usage of MNOs. Moreover, the research
studies the decreasing ARPU trend of MNOs vs an OTT ARPU, defining the turnover juncture point at which the
2 ARPUs have been equalized and then the MNOs` ARPU started to be less than OTTs` ARPU which kept
increasing. Defining this turnover point will help to precisely predict the quantified revenue loss of MNOs and
correlates it to the OTT impact. The study combines several researchers` proposals to overcome the OTTs` impact
on MNOs. This research combines and analyse 27 former proposed strategies, to result in recommending a
combined competitive-participatory approach for MNOs to avoid further revenue losses caused by OTT providers
in the future. The derived research`s results in relation to the quantified revenue loss empowers the recommended
strategy and pushforward implementing it, with ability to measure the improvement.
Here comes the research logic; with the advancements of telecom industry, mobile users’ number is increasing, and
MNOs are funding more investments to serve the increased traffic. Unlikely, the ARPU and revenue growth rate
are deteriorating. The dispute is about if the OTTs impacted the declining trends. The study recommends a hybrid
strategy be followed by MNOs` in order to avoid revenue forfeiture and get their declining revenue growth trends
back, where this change is inevitable for MNOs. The research aims to achieve 2 objectives, first is to critically
evaluate the impact of OTT service providers on global MNOs. Second is to critically evaluate the strategies
proposed for MNOs to overcome the OTTs` impact. In order to get hold of the objectives, the research questions
have been designed relatively by applying techniques of SMART project management following Grant et al. (2013),
the questions have been derived as below:
[1] Is the emergence of OTTs presents a threat or opportunity to MNOs?
[2] What are the main revenue streams of MNOs, what is the impact brought by OTT providers on those streams?
What is the most affected stream? how the MNOs vs OTTs services` trends looks like?
[3] Why customers shifted to OTTs` voice and messaging services?
[4] What is the hidden revenue loss for MNOs, what is the quantified delta of MNO’s revenue growth if phase I
and phase II compared? How much is the amount of the revenue loss?
[5] What are strategies proposed by former researches to overcome the OTTs` impact on MNOs? What is the
most popular recommended strategy in the researches?
[6] What MNOs should follow to improve their revenue streams in phase III?
I.IV Potential value of the research
In view of the current robust penetration of telecommunications industry in the world, the conclusions of this
research redound to the advantage of humanity and society; flourishing telecommunications industry back will help
in connecting 2.5 unconnected people around the world. With a specific affirmation on the impact of OTT on
MNO’s revenues, this study is envisaged to make a workable participation to the telecom industry body of
knowledge. The revenue loss reveal developed model in this research can be further utilized by MNOs enabling
them to expose their hidden revenue loss. The research recommendations of how to overcome the OTTs impact
on MNOs, shall go for implementation by MNOs quicker than former researchers` proposals, as it is empowered
by an actual quantified figure of the OTTs impact. Applying the two-dimensional strategy will convert the revealed
unseen revenue loss into an actual revenue for MNOs` that will help to prosper the global mobile telecom industry.
In the light of the revealed hidden revenue loss, this study helps to expedite the other researcher’s former
recommended strategies which have been pending for long time without implementation.

II Methodology
While the usual format is for the literature review section to come before the Methodology section (Nikolov 2013),
in this research the methodology section has been written first. As the literature review is a method used to achieve
2 objectives of the research. Additionally, the literature review is including some supporting analytics pulling former
researches together that will be explained at methodology section.
Methods are the processes and vehicles used in order to collect and analyse the data sets in this research (Wisker
2008), aiming to answer the 6 researches questions and accomplish the 2 objectives. The key aspects considered in
selecting this research`s methods are listed at the table 2 (Amended from Wisker 2008) below. A result-oriented
approach similar to Wisker (2008) has been taken which begins with defining the targeted results in order to narrow
down the methodology selection.
Objectives Method Information Data Type Sample Size Statistical Selected method
availability significance
Method I -A Yes Qualitative Low Low Literature review
Objective I Method I -B Yes (Open Quantitative High High Trend analysis (Linear regression &
source data) Extrapolation)
Objective II Method II Yes Qualitative Low Low Literature review
Table 2. Reserch Methodology Selection (Amended from Wisker 2008)
Method I -A
As the previously conducted researches are still not aligned in the concluded impact of OTTs on MNOs. Method
I-A investigates an extensive range of sources including researches that previously examined the impact of OTTs
on MNOs in addition to whitepapers and telecom journals excerpts to provide in depth evaluation of the OTTs
impact. This method aims to pull previous researches together to add synopsis and breakdown the researchers`
conclusions. To achieve this objective, a qualitative method has been selected based on literature review as per
Kothari (2004).
Method I -B
While method I-A concentrates on collecting, analysing and generating a non-numerical data, method I-B uses actual
numerical data in order to support the literature review with a referenced financial open source data collected from
organizations, whitepapers, telecommunications journals excerpts and recognized statistical telecom bodies
including GSMA, Informa and Ovum, in addition to the MNOs` annually and quarterly open source released
financial reports. As the research targets to study the global telecom industry, GSMA (2020b) reports have been
used that includes a definitive source of mobile industry data which covers every MNOs all over the world.
Quantitative methodology was adopted based on regression and extrapolation targeting to answer the research
questions articulated above. Linear regression of phase I actual revenue values followed by extrapolation to forecast
the baseline expected revenue of phase II and III, is followed in order to statistically evaluate the hypothesized
revenue`s nonlinear trend over the years following Lavrakas (2008), Pickard (2007) and Grove (2004). Where linear
regression is a process applied in phase I to derive a single line that best fits the given set of revenues data points
over the years (X and Y). The X values are the year, and Y values are variable which is the revenue. Linear regression
using least square values methodology is used to draw the revenue trend line that mostly fits phase I non-linear
revenue trend. Most graphing calculators including Microsoft Power BI, QLIK and Excel can draw this line.
Once the revenue line is visualized in phase I, an equation will be derived that draws this revenue line. In order to
predict a value of Y which is out of our known values set, Linear extrapolation method will be used at which a value
X (Year) is given to get resulting value Y (Variable) to expand the trend line in phase II and III. Linear extrapolation
is the process at which value of X being evaluated into the equation of the line of best fit to get a resulting Y value.
In statistics, extrapolation is a process followed to estimate unknown values beyond a given variables in distinct
range as defined by Seber and Lee (2003) and Montgomery et al. (2012). The accuracy of the forecasted data is
conditional on the continuity of the same situation in the future, as this method tries to predict the future data based
on historical data (Byjus 2018). Extrapolation can be applied by extending the known series or values beyond the

know area to the unknow area. It is applied in this research by drawing a tangent line among the at the endpoint of
phase I and that will be extended till Phase II and Phase III Seber and Lee (2003). In this study, the known area is
phase I and the unknown area is phase II and phase III. Extrapolation concept can be applied on different disciplines
including telecommunications with some categorical data. The expected accuracy from applying this method in this
research is highly supported by Seber and Lee (2003) explanation that this method is suitable for any linear function
and in this report phase I trend will be converted into linear trend using the regression. Also, Montgomery et al.
(2012) explained that when the unknown values to be predicted is not too far from the given data, linear
extrapolation provides an accurate result, which is the case in this research as Phase II and Phase III are not far
from Phase I data period.
Method II
Several researchers have examined the OTTs impact on MNOs and accordingly recommended strategies to
overcome this impact. Method II in this research will focus on analysing and gathering the different
recommendations of researches and authors together to narrow down the strategies into 3 holistic main strategies
which helps to align the different strategies. Then each strategy recommendation will be analysed and assigned one
of the 3 holistic strategies which can fit the most into it. The idea is to quantify the recommendations orientations
to get the most recommended strategy which will support the final recommendation of this research. Literature
review methodology has been selected for this objective, backed by data analytics.
III Literature review
III.I OTTs are threat or opportunity for MNOs
Whereas the actuality is that the global revenue growth rate of MNOs is declining according to Ovum (2018) and
GSMA (2020b), the researches` dispute is still ongoing on examining how OTTs contributed in this declining
MNOs` trend. Various research papers have been conducted to isolate and determine the OTTs` effect on MNOs,
nevertheless they have been concluded in two reverse directions:
First direction adopts that OTTs have formed a genuine threat on MNOs which reduced their revenues and
jeopardized the MNOs` current business model. BMI (2018) listed OTTs in the threat`s list after conducting SWOT
(Strengths, Weaknesses, Opportunities, And Threats) analysis on USA`s (United States of America)
telecommunications market as OTTs have shifted MNOs` traditional SMS and voice revenues to their own
applications. Similarly, Fowora et al. (2018) concluded in their study that OTTs have harmed the MNOs business
as the low-cost digital content they offer to consumers has turned the consumers to prefer using OTTs services that
utilizes the MNOs networks without any lease agreement or policies to regulate them. However, Fowora et al. (2018)
underlined that MNOs registered substantial losses due to OTTs, they have not quantified this loss, so the
significance of their study is low. Equally, Joshi et al. (2016), without a solid evidence, have directly pointed out to
OTTs of being the major contributor of draining MNOs` revenues and ARPU. With non-empirical study, they
propounded revenue sharing models between MNOs and OTTs. Also, Crawshaw (2017) unswervingly underlined
OTT providers as a factual threat on MNOs, likewise Kwizera et al. (2018) and Barclay (2015) who acknowledged
that the OTTs are the essential reason of disrupting the traditional business model of telecommunications so the
regulatory have to take actions to resolve the issue. With more offensive approach, Sujata et al. (2015) proposed
blocking the OTTs by MNOs in order to contain OTTs` threat, nevertheless in their study they failed to illustrate
enough the OTTs` threats.
The dispute continuing, in the quantitative study done by Whitwell (2017) to scale the OTTs risk on MNOs, the
survey results showed that 43% of western Europe considers OTTs as threat and central Asia region considers it as
threat by 33%. However, Whitwell (2017) survey is stronger than Crawshaw (2017) survey as they included more
participants from OTTs, their survey results were not biased enough towards certain direction, as it got nearly equal
responses number for threat or opportunity debate. Generally, this researcher`s orientation censures the reason of
the MNOs` revenue loss to the regulators of not controlling OTTs in the market with firm actions implementation.
From their side, regulators, decided not to regulate OTT services and to be technologically neutral. So Cataldo

(2016) in his research, accused regulators of harming the growth of mobile telecommunications industry and urged
them to apply strict laws and regulations against OTTs. While most of researches focused on MNOs and regulators,
Linnhoff-Popien et al. (2017) have examined OTTs position in this dispute and concluded that OTTs are
substantially rejecting any specific laws and policies particularly in USA.
Contradictory, the second direction of researches identified the OTTs as an opportunity for MNOs. In their survey
results, Schneider and Hildebrandt (2017) indicated that MNOs are likely to profit from the OTTs uprising trend
as they are resulting into an increase of consumers’ willingness-to-pay for MNOs mobile access. Strok et al. (2016)
and Esselaar and Stork (2018) claimed that OTTs represent a considerable opportunity for MNOs which resulted
in obvious upsurge of mobile users, smartphones and data traffic, which increased the MNOs` revenues from the
induced data revenues generated by OTTs usage, that compensated the inherent decreases in the traditional voice
calls and SMS revenues. Though, the revenue growth trends used for some countries in their research are not aligned
if compared to GSMA (2020b) global MNOs market data. Furthermore, despite Stork et al. (2016) and (Esselaar
and Stork 2018) showed an annual increase in revenue growth trend for MNOs to support the hypothesis that
OTTs are opportunity, their reported revenue growth is less if compared to the period from 2009 till 2014. Esselaar
and Stork (2018) blamed the declining revenues of the MNOs on the insufficient network coverage of the 3G and
4G mobile networks or on obsolete operating conditions or outdated voice and SMS only business models ; MNOs
with wider mobile networks coverage that have invested in network upgrades or modernized their business models
, have succeeded in monetizing the significant increase in traffic, hence compensates voice and SMS revenue losses.
Esselaar and Stork (2018) appealed the MNOs to envisage OTT services as a sufficient tool to wheel up data traffic
growth and to enlarge their subscribers` base, and the regulators to stimulate MNOs` investment into 5G coverage
instead of protecting MNOs from OTTs. Similarly, Trask (2018) supported this direction of considering OTTs as
an unique opportunity to MNOs and emphasized that OTT providers are not yet subject to a firm regulation, which
is aligned with Monarat and Hitoshi (2019) who concluded that applying regulations on OTTs like MNOs is not
preferable solution. Likewise, Schneider and Hildebrandt (2017) raised a caution to policy makers and regulators
not to employ similar rules on OTTs as MNOs as their functionalities are different and warned from consequences
that might arise on consumers. In the same way, BEREC (2015) accentuated that OTTs are opportunity that enables
MNOs to increase their data revenues and attract new customers as well as reduce churn, hence MNOs have enough
incentives to seek partnering with OTTs. This orientation of researches generally calls to protect OTTs from strict
regulations, and attacks the MNOs of not upgrading their strategies, therefore this direction promotes a cooperative
strategy that MNOs must take forward with OTTs to increase their revenues.
III.II Impact of OTT on MNOs
Wether it is threat or opportinuty, there are solid variations occurred on MNOs` main sources of revenus due to
the emergence of OTTs. Detecon (2017) cited by Krämer and Jalajel (2019) reported that only Facebook, Instagram
and Whatsapp have outgrown 8 major MNOs including Vodafone, Deutshe Telecom and Verizon, and in regards
of the number of subscriptions; MNOs have got 2.11 billion subscribers compared to 2.45 OTT users). However,
this comparison is not valid as the 8 MNOs` footprint is limited if compared to those 3 OTTs whose footprint is
global. The increase in mobile user’s number happened due to the extensive infrastructure offered from MNOs;
MNOs overall have spent billions of dollars to make the infrastructure. Additionally, as countries` regulations,
MNOs have to purchase the frequency band license (Heinrich, 2014). Knoben (2015) described OTTs as diverse
universe; OTTs operations are not profitable but they target to monitze their investments by advertisements.
Heuermann (2019) elaborated that OTT providers are using a “Freemium” model which is a recipe of “free” plus
“premium”, this business model became an overriding model for all new OTTs. At which, customers get the basic
offered features at zero cost then can access advanced functionalities with a subscription fee. The OTT companies
can afford using this model as they are not paying any frequency bandwidth nor regulatory nor licenses fees. OTTs
just using MNOs` networks who are paying all of those (Heinrich, 2014).
As shown at table 3 (Amended from Knoben 2015,p.17 and Bhawan and Marg 2015, p.6 ) similar to Minges and
Kelly (2018) but with adding the MNOs colomn in this reserch to compare the revenue sources. The OTT providers
are categorized into 4 calsses based on the offered services. The first two calsses are considred as less impacting on

the MNOs revenues, commerce OTTs such as Amazon and Paypal that offeres shopping and finance services and
their revenue srouce is from transactions, and the social media such as Facebook and Twitter with revenues from
advertisment and premium subscribtions. Other two OTT calsses are, OTT communications that offeres voice and
messaging services and directly overlabing with MNOs` offered services and lastly OTT media which offeres
content services such as Netflex and Youtube. The last 2 OTT classes` services are directly overlabing with MNOs
offered traditional services and hence the revenue sources of LDC,SMS, voice calls and data, which will be deeply
explored below :
OTT MNO
OTT Classess Example Revenue source MNO revenues source
OTT Commerce Amazon, PayPaal, eBay Transaction based
OTT Social Media Facebook,Twitter,LinkedIn Advertisement, subscription for premium services, free services
OTT Communications Skype,Whatsapp,Viber, Advertisement, Subscription for premium servies, free services LDC,SMS,Voice calls
Facebook messenger. ,Data
OTT Media Youtube, Netflex,Spotify Advertisement, subscription for premium services , free services
transaction based.
Table 3 The OTT vs MNOs Business Models (Amended from Knoben 2015, p.17, and Bhawan and Marg 2015, p.6)
(LDC) Long distance calls
The OTTs` impact has been intense in what has been long lasting as a major traditional profit centre for MNOs
which is the international voice calls. Farooq and Raju (2019) elucidated that the international voice calls` revenues
for MNOs are extremely decreasing as a result of the quick emergence of OTTs` applications such as Messenger,
Skype and WhatsApp. Only Skype handled a third of international voice calls traffic globally at 2012 as reported by
Goldstein (2013). Joshi (2015) further explained that the offered services of OTTs with high flexibilities and low or
zero cost in comparison to the MNOs` cost, is the main reason that users are preferring to use OTTs` international
calls. The international conversational voice minutes number was increasing for MNOs till 2012 where it
commenced to decrease afterwards, on the other hand the voice minutes carried by OTTs started to increase since
the beginning and exceeded the MNOs minutes number at 2016 (Minges and Kelly 2018). As a result of this, Stroke
et. Al (2016) mentioned that some MNOs has attempted to prevent customers using OTTs such as Skype as example
to protect their international calls revenues.
(SMS) Short message service
The traditional MNOs` service of sending a message from the mobile device is based on CS (circuit switching)
networks technology and it is called SMS. The MNOs` SMS numbers are decreasing over the years and being
replaced by PS (packet switching) networking technology based on IP (Internet Protocol) (3GPP 2015), where all
the OTTs are using to deliver their content over MNOs` networks freely. Those variations were followed by a sharp
decline in MNOs` conventional messages services (SMS) numbers, which used to be sent exclusively over their
networks. This decline is backed by the analysis done by Ofcom (2016) on 17 major telecommunications markets,
where it was found that the number of SMS messages reduced in 14 out of 17 countries. Specifically, Spain had a
decrease of 36% in SMS number if compared to 2015. Similarly, IPcarrier (2013) reported that SMS usage in China
has declined nearly 11% in 2012 and OTT is the reason. Also, Heuermann (2019) reported that MNOs encountered
49.6 $ billion revenue loss from SMS at 2014. Saghaeian (2015) has emphasized the MNOs` SMS traffic decrease
with the reported quarterly figures and concluded a year to year decline in SMS traffic by 7% starting 2013. This
decline has started at 2011 after the global SMS traffic reached its peak of 7.4 trillion messages at this year meanwhile
the OTT messaging has been increasing rapidly. Reactively, few MNOs started developing their own OTT
applications and using IP messaging same as OTTs, but it is way far from the achieved OTT messaging numbers as
per Krämer and Jalajel (2019) and ITU (2018).
The decline of the MNOs SMS trend was due to the huge shift from users towards OTT messaging, there are major
reasons for this shift that is illustrated in the comparison held at table 4 (amended from Farooq and Raju 2019, p.7)

Service MNO services OTT services
Features SMS Telegram WhatsApp Facebook messenger Skype
Text ✓ 1 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Audio call × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Video call × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
User stories × 0 ✓ 1 ✓ 1 ✓ 1 × 0
Open source × 0 ✓ 1 × 0 × 0 × 0
Characters 160 0 Unlimited 1 Unlimited 1 Unlimited 1 Unlimited 1
Group chat × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Emoticons × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Photo sharing × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Video sharing × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Location sharing × 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Free app download N/A 0 ✓ 1 ✓ 1 ✓ 1 ✓ 1
MSID number call × 0 × 0 × 0 × 0 ✓ 1
Total score 1 12 11 11 11
Table 4. MNO vs OTT messaging services (Amended from Farooq and Raju 2019, p.7)
to explore the major 13 features availability Of MNOs` and OTTs selected top 4 providers, similar idea to Farooq
and Raju (2019) but with different OTTs selected ,adding extra features and adding a total score at the end based
on overall features availability to conclude the overall difference in this research. As a total score, the traditional
SMS having only 1 feature if compared to 12,11,11 and 11 features from Telegram, Whatsapp, Facebook messenger
and Skype respectively. This huge difference of features availability assures the diversity and flexibility of the OTTs
offered features in comparison to the limited MNO outdated features that don’t fulfil the consumers requirements.
This result shows that MNOs have to develop their offered services to cope with the customers’ demands and to
be able to compete with OTTs.
Voice calls
Traditional voice communication service was the major revenue source for MNOs (Czarnecki and Dietze 2017).
But, with the emergence of smartphones and mobile broadband, mobile subscribers have been significantly shifting
to using OTTs` voice applications such as Line, Viber, Whatsapp, etc instead of the MNOs traditional voice services.
MNOs encountered 22.2 Billion $ in fixed telephony voice and 31.9 billion $ in mobile telephony due to the OTTs
(Heuermann 2019). As per Kraemer (2017), only Whatsapp hits 100 million calls per day. Accordingly, the MNOs
revenues from voice calls was steadily declining (Lotz and Korzunowicz 2019). Buzdar et al. (2016) and Farooq and
Jabbar (2014) justified the consumers shift to OTT services as it is much advanced and widespread than what MNOs
services offered. MNOs are offering affordable internet bundles including cheap voice calls, but customers are
buying them to use OTT services. Buzdar et al. (2016) warned that if MNOs continue in offering such bundles that
empowers the OTTs, they will completely lose their messaging and voice revenues. This has forced MNOs to invest
in launching 4G and 5G new radio access technologies in order to maximize their revenues from alternative streams
(Czarnecki and Dietze 2017). Unlikely, this investment has accelerated the erosion of their voice calls revenues as
the rapid rollout of new technologies coverage led to increased service speed and decreased latency making the
OTTs` voice quality comparable and even better than MNOs` offered voice service. This has strengthened the
OTTs penetration into the market and empowered the OTTs voice applications which was an undesired
consequence for MNOs (Lotz and Korzunowicz 2019) and (Czarnecki and Dietze 2017).
Consequently, the MNOs were on the brink of turning into a data pipes` supplier for OTT providers who are
running their applications over their networks without incurring any cost. While the MNOs` infrastructure required
to offer their traditional voice services (CS) circuit switching is different than the infrastructure required for OTTs`
voice services VOIP (Voice Over Internet Protocol) which based on PS data network infrastructure 3GPP (2015).
MNOs stuck in a situation that they have to maintain 2 different sets of expensive of infrastructures for their own
CS voice and PS data for OTTs` voice applications (Lotz and Korzunowicz 2019), without any participation from
OTT providers in this infrastructure investment (Czarnecki and Dietze 2017). To cope with this change, MNOs has
introduced VOLTE (Voice Over LTE) which is a voice service carried over LTE data networks and it is quite
similar to the OTTs voice services infrastructure requirements with few extra nodes such as IMS (IP Multimedia

Subsystem) (3GPP 2013). In this situation the MNOs have only single infrastructure for both their voice services
and OTTs voice services. As the traditional CS voice services were continuing in declining, also due to the need of
more spectrum to handle the enormous voice and data traffic, the MNOs have started decommissioning their legacy
expensive 2G and 3G networks (Lotz and Korzunowicz 2019). Minges and Kelly (2018) reported that MNOs voice
revenues in 2015 was 46% out of overall revenues, however it looks high, but it has sharply decreased as compared
to 66% in 2010. Furthermore, ETTelecom (2020) anticipated that MNOs` voice revenues most likely to drop by
45% at 2024 compared to 2019. As in 2019 voice revenues recorded 381 $ Billion and will decrease to 208 $ Billion
in 2024 and this is due to the increase of OTTs voice providers number by 88% in the next 5 years.
OTT providers have cannibalized MNOs` messaging and voice services after luring MNO`s customers with their
free messaging, voice and also video functionalities. Such digital-savvy OTT companies - Beyond the “free” cost -
are offering innovative VAS (value-added services) in order to complement their services to customers. The
innovative VAS pays off; in 2011, fixed voice, mobile voice and messaging services that offered by OTTs, accounted
for 11%,2% and 9% of revenues respectively. After 7 years only, in 2018, the numbers increased to approximately
50, 25 and 60 % (Meffert and Mohr 2017).To analyse the reasons that urged the customers to use OTTs voice
applications instead of MNOs` voice, a gap analysis held at table 5 (personal collection) including the main 7 features
based on consumers demands from MNOs and 4 selected OTTs.
Category Telecom product OTT services

Features Voice Viber WhatsApp Facebook messenger Skype
International Call to any ✓ 1 × 0 × 0 × 0 ✓ 1
mobile number
Call to Landline number ✓ 1 ✓ 1 × 0 × 0 ✓ 1
Group Calls ✓ 1 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Price ✓ 1 ✓ 1 ✓ 1 ✓ 1 ✓ 1
Mobile Data required Not 1 Required 0 Required 0 Required 0 Required 0
required
Min Phone requirement Feature 1 Smartphone 0 Smartphone 0 Smartphone 0 Smartphone 0
Call Reliability ✓ 1 × 0 × 0 × 0 × 0
Total score 7 3 2 2 4
Table 5. MNO vs OTT voice call services (personal collection)
Unlike the SMS, the overall score of voice applications from MNOs is 7 compared to 3,2,2,4 for Viber, Whatsapp,
Facebook messenger and Skype respectively. This explains the surviving trends for the voice calls over the MNOs
that will be analysed at figure 10 p.26. On the other hand, the voice revenue is not similarly increasing with the
increasing voice calls, the reason behind this is that is the offered free voice calls minutes by MNOs to the customers
on top of their purchased data packages to use the OTTs as a prime demand.
Data Traffic
The rapid uptake of OTT applications in global telecommunications market has resulted in exponential increase in
data traffic. According to research conducted by Meffert and Mohr (2017) in January, on average, this generation
spends about 315 minutes online every day. Verma (2014) highlighted that MNOs are facing a tremendous change
in their stagnating market due to the usage behavior change with the smartphone penetration, as it generates 14
times data volume more than if compared to the legacy feature phones (Czarnecki and Dietze 2017). Mobile users’
numbers are significantly increasing, GSMA (2020a) reported 5.2 billion mobile subscribers compared to 6.3 billion
reported by EIU (2020), but EIU reported non-unique subscribers’ numbers. One can only imagine the volume of
digitized data streaming over MNOs networks across the world those users are generating! This increasing trend
causes severe congestion in mobile networks due to the surge demand of video content. Minges and Kelly (2018)
identified MNOs` challenge as, voice and text, traditional revenue earner for MNOs are declining as users shift to
using OTT services which the data traffic volumes to pop up; in 2011 the smartphones` data traffic surpassed the
voice traffic. Based on Cisco (2018) Visual Networking Studies, the mobile data volume recorded 5 Exabytes per
month at 2013 and has grown by 61% reaching 15.9 Exabytes at 2018, specifically, video traffic increased from 0.6
Exabytes to 9.1 Exabytes. This addresses the key challenge for MNOs with their limited capacity backhaul network

represented in the intermediate links between radio access and core networks, which is close to saturation as
explained by Nexans (2020).
The growth of data traffic has pushed MNOs to invest more in network capacity enhancement by requiring more
spectrum, but also deploying more infrastructure in small cells. This trend of increasing data usage and the serious
threat of OTT services will force MNOs to adopt a new business model. Also, MNOs would have to consider the
growth in data traffic as another business opportunity due to proliferation of OTT communication services. While
MNOs witnessed a loss of voice and SMS revenues, they have noticed a dramatic increase of data revenue. Peterson
(2015) warned that without the transformation of their business model, MNOs` would be considered as dump pipes
instead of traditional broadband MNOs. Particularly, video content OTTs provide different challenge, these include
providers of television and films such as Netflix throughout subscription services and Youtube with free services,
in which the video demand is increasing by customers (Peterson 2015). Similarly, (Sandvine 2015) highlighted that
OTTs are not only competing with MNOs that providing video content services, but also, they are responsible for
an increased substantial traffic volume that goes over MNOs` networks. As the example given by Sandvine (2015),
Facebook properties` (Instagram & Whatsapp) and Googles` (Youtube, Google cloud and Google market) are
accountable for 60% of total MNOs` traffic in whole Latin Americ. And globally, top 10 OTT providers consumes
71% of MNOs` global traffic. However Krämer and Jalajel (2019) claimed that OTT services increases the MNOs`
core revenues as it increases the MNOs` data usage, voice and messaging ,hence it enlarges the MNOs` footprint,
the claim was not right, as the OTTs services only increase the data usage not voice and messaging as the voice and
messaging used by OTTs are based on PS data service which increases the data only as per 3GPP (2015). The reality
even, that it decreases the voice and messaging of the MNOs as it competes directly with them by their services.
III.III MNOs strategies to overcome OTT impact
When the OTTs appeared on the telecommunication market, MNOs` were unsure how to react while being
threatened. MNOs have pursued several responses and strategies to deal with the challenges arises from OTT
providers, ranging from blocking to partnering (Czarnecki and Dietze 2017) and (Knoben 2015), or ranging from
denial to emulation strategies as stated by Krämer and Jalajel (2019, p.211). Blocking OTT voice services is one of
the strategies that MNOs have used. On the other hand, some MNOs chosen the partnership with OTTs instead
of blocking them, furthermore some MNOs have developed their own OTT-Likewise services and added to their
digital business divisions. Those 2 approaches represent minority of cases so far. Particularly, developing own OTT
service is a strategy that requires higher maturity level in digital business areas and still in its early stages. Meanwhile,
the ongoing OTTs` market developments are increasing the pressure on MNOs, giving them a very narrow
opportunity window to conceive an appropriate and effective response strategy (Czarnecki and Dietze 2017).
Similarly, Minges and Kelly (2018) elaborated that MNOs have developed several responses to OTTs. They have
argued to regulate OTT providers which offers voice and messaging services same way MNOs` are regulated.
The outcomes of those strategies were assorted, at best was to slow down the development of the OTT offered
services, however, not to terminate it (Krämer and Jalajel 2019). Crawshaw (2017) has conducted a quantitative
survey on MNOs to examine the MNOs` strategies followed towards the threat from OTTs. Despite Crawshaw`s
(2017) survey high sample size of 119, the OTT providers participants were only 8%, more participants from OTT
providers should have been involved to get them into the scene and establish a closed loop solution. The popular
response in this survey was 42% as partnering with OTTs to offer a combined bundled service. On the other hand,
a brave 24% chosen a competition strategy against OTTs by developing their own OTT applications. And the rest
of participants chosen a neutral strategy. Unsimilar to Crawshaw`s (2017) survey results, Czarnecki and Dietze`s
(2017) claimed that MNOs mostly implemented defensive strategies.
In order to resolve this dispute and measure the significance of different proposed strategies, several researches
proposals of the MNOs` strategic responses to OTTs have been aggregated and examined in order to conclude the

most appropriate strategy in this research. The analysis shows that all researches’ proposals can be categorized into
3 major holistic strategies (Compete, Partner and Accept) described as following:
“Compete” Strategy
1. Seeking for regulatory support
The spontaneous reaction from MNOs was tackling the OTTs` threat by applying to authorities to change
regulations. Requesting permissions to ask OTT for the cost of the traffic handled by their networks. Telefonica,
KP and Italia telecom are examples of MNOs who have applied to European commission for regulating the OTTs
(Gómez-Uranga et al. 2016). MNOs are calling to charge OTTs for using their networks, seeking to monetize OTT
network traffic. Applying “sysball” principle as defined by Knoben (2015), which is the paradigm shift from ‘content
is king’ to ‘access to end customer is king’ as the MNOs only providing access not content as OTTs. Apparently,
there is a market and market entry conditions` imbalance between the OTT providers and the licensed MNOs as
there is no proper OTTs` regulation yet. Regulatory requirements and limitations determine the MNOs` business
models, on contrarily, OTT providers are free of such limitations. The market setups currently have not yet adapted
to this new competitive situation (Knoben 2015). Table 4 (Amended from Knoben 2015 and Czarnecki and Dietze
2017 P.37) explores the comparison between licensed MNOs and OTT providers, 7 restricted regulations are
applied on MNOs while OTT providers are free from those restrictions.
Regulation Licensed MNOs OTT Providers

Licensing License required for market entry and frequency band usage No requirements for license
QoS (Quality of Regulatory set targeted SLA (Service level agreement) on the No QoS requirements or commitments
Service) MNOs in the license, which is subject to fines, if not achieved.
Interconnectivity Interconnectivity is mandated in the license No interconnectivity requirements
Universal services Must follow global services obligations Not following universal service regime
Customers` protection Subject to enforceable consumer protection policy No enforcement power
Legal interception License condition Depends on country
Taxes Must obey country`s taxes regime Depends on service type
Table 6. MNOs vs OTT Regulations (Amended from Knoben 2015 and Czarnecki and Dietze 2017, p.37)
From a technical point of view, OTTs provide consumers with some ease of communication and quality of service,
to some extent. However, the fact remains that there is absence of established rules of the game, especially, issues
related the competition with the traditional MNOs, supervision of OTT activities, personal data usage conditions,
data traffic monetization, taxation issues, provision and operation obligations. The regulatory framework absence
is linked to the lack of a solid OTTs definition, which has a direct impact on obligations governing telecom activities
as well as business relationships (BEREC 2015). The regulators position is not supportive to MNOs; accordingly,
MNOs have to think further to deal with the OTT threats.
2. Blocking the OTT Services
Several MNOs have determined to attack the OTT services by prohibiting their subscribers from using OTT
applications over their networks, targeting to rebuild OTT portfolio and integrate OTT service in product bundle.
The blocking is achieved by merging technical and economic features that halt certain OTTs from using MNOs`
IP services (Knoben 2015). The objective of blocking certain OTT service, is to secure the core MNOs` revenues
by making the OTT service unavailable or unattractive. Du, Zain, Etisalat and STC are vital examples of MNOs
who blocked OTT services as reported by Knoben (2015). Also, Spain and France previously have blocked OTT
services when it offered overlapping services such as messaging and voice calla that impacted MNOs` revenues.
Farooq and Raju (2019) justified blocking OTTs` services, as the OTT services were acting like MNOs but without
paying regulation fees, neither fulfilling the responsibilities. Sujata et al. (2015) supported the OTTs` blocking
strategy willing to defeat the OTTs threat on MNOs. But Sujata et al. (2015) have not addressed the negative
consequences that might result from this action which was explored by Farooq and Raju (2019). Farooq and Raju

(2019) suggested that MNOs can force OTTs to give a market share by blocking them for a short period, limiting
the suggestion to the countries where there is no technology neutrality law which prevent such action. This law
exists in USA and Europe as example where they can’t ban services providers or even internet content. In countries
where this law doesn’t apply, MNOs can try the short period OTT blocking tactic, but on the other hand, the fear
of losing is high from this tactic (Farooq and Raju 2019). Farooq and Raju (2019) addressed the negative impacts of
blocking OTTs; as it decreases the revenues of MNOs, as customers mainly purchasing data bundles from MNOs
in order only to use OTT services.
Farooq and Raju (2019) and Sujata et al. (2015) have given a very risky recommendation to MNOs to block the
OTT service providers for a short period and ask OTTs for market share. While blocking could be considered at
early 2010s, it is nearly impossible now to implement due to the pressure that will be created from the mobile
subscribers as OTTs became a vital component of their daily life. All the researches that suggested blocking OTTs
are irresponsible, the OTTs are vital tool in our life nowadays. As example, with the outbreak of pandemic COVID-
19 corona virus at 2020, WHO (World health organization) is using WhatsApp as a communication channel with
all the people in the world through health alerts that brings COVID-19 facts and required precautions to billions of
people (WHO 2020).
3. Absorb the OTTs
Another strategy followed by MNOs was making OTTs ineffective from the customer perspective by absorbing
OTT services. Saving money is the objective of consumers to choose using OTT services. In response, the MNOs
offers large messaging and voice free bundles on top of the purchased data packages by consumers, aiming to get
the consumers to use their traditional voice and messaging services back and abandon the OTTs applications. As
OTT services usage is expanding and social media is getting very popular, Farooq and Raju (2019) urged that,
offering such cheap bundles can help MNOs to get more habitual internet customers which leads to higher usage
and revenues. Similarly, Stork et. Al (2016) supported this approach of unlimited voice call and text messages as
MNOs can receive the desired ARPU when they set the price of the top-up packages.
4. Create own OTT or acquire them
MNOs are still exploring how they can create their own value-added OTT services and hop on the OTT trend.
Krussel (2019) proposed an offensive or defensive strategy for MNOs by cannibalizing OTT services such as
WhatsApp. MNOs to offer similar services to the OTT provided services is a possible strategy explored by
Czarnecki and Dietze (2017) as well. However Czarnecki and Dietze (2017) considered launching MNOs`
proprietary OTT service is the least developed option so far, HBO is a vital example opposing their claim; HBO
Go is a vital example of how MNOs can become a branded strong destination for content as per Kastrenakes (2018)
and Infopulse 2019). The owner of HBO, AT&T, are not stopping developments just here. They recently
announced launching of several value-added services and products, including 5 broadband delivered OTT products.
Similarly, UK’s Three has launched content packages, offering OTT video and music subscription also a mix of TV
channels. Another example is T-Mobile US that have launched a statewide trend offering zero-rated video services
delivered over cellular network using Binge On application (T-mobile 2020). Equally, German giant Deutsche
Telecom have offered its own IPTV OTT application Magenta, which is a virtual pay TV available on standalone
basis (Omdia 2018).
On the other hand, some MNOs tried to compete with the OTTs by creating equivalent voice and instant messaging
services. As example, Telefonica in 2012 has launched an instant messaging service targeting to repel Line and
WhatsApp, nevertheless the app managed to get only 1 million downloads compared to 200 million by Line and
300 million logged by Whatsapp (Reuters 2014). Many MNOs have created their own OTT application, however
most of them are offering video content services. In the previous decade, there have been few attempts by MNOs

to deploy instant messaging and voice OTT apps. The MNOs focus should have been more on the voice and
messaging OTT apps as it is what directly overlap with their major revenue streams.
The 4 explored approaches in “compete” strategy didn’t bring the required outcomes for the MNOs, apart from
the 4th approach of developing own OTT, but even this approach was not successful in the case of voice and
messaging application. Generally, competing with OTTs which have taken full advantage of the major network
externalities already, is a herculean task (Gómez-Uranga et al. 2016).
“Partner” Strategy
As Jim Henson said “If you can't beat them. Join them”. Some MNOs attempted the way of partnering rather than
competing with OTTs aiming to expand their value and to benefit from their widespread. Currently there is
turnaround in strategies that can summed up in cooperating with OTTs (Krämer and Jalajel 2019, p.211). MNOs
who decided to partner with OTTs might take advantage from both OTT services and the OTT brand (Czarnecki
and Dietze 2017). The price will remain the major drive of voice market so MNOs are using pricing levers in order
to assure that their own voice services are appropriate to their consumers (Czarnecki and Dietze 2017) . MNOs
targeted three major partnership`s objectives; to complement MNOs` own portfolio, OTT containment and
securing high values segments by service differentiation. Krussel (2019) as well proposed the cooperation strategy
however it was conditional; that only applies when there is an immediate little overlapping between OTTs` services
and the MNOs services offered. Krussel (2019) highlighted the advantages of partnership as OTTs` service has got
more of an additive character and wider spread, so it widens the MNO`s access to new customers` segments where
the MNOs have a limited footprint, such as the entertainment services, Deezer and Spotify (Krussel 2019,p214).
Krussel (2019) urged MNOs to consider Netflix and Spotify as a big volume partners with the target to open new
market segments and limit customer churn, however in the study, the positive impact of limiting the churn was not
compared to the negative impact that might happen on the capacity due to traffic increase. Infopulse (2019)
supported the cooperative strategies claiming that OTTs have got enough revenue and space to contain both MNOs
and OTTs.
These days the trend of partnering with OTTs become ubiquitous among MNOs where they offer monthly internet
bundles with specific OTTs (Farooq and Raju 2019). To be more promising than opposing it, MNOs have started
to perceive the value of connecting with the efficiency and
creativity of the OTTs. From 2012 till 2018, there were 943
partnerships have been established globally as shown at figure
2 (Amended from Krämer and Jalajel 2019, p.212). Following
the advancements of the content providers such as HBO GO,
Spotify and Netflix, the numbers have significantly grown;
only in 2016, 61% of these partnerships were concluded with
OTTs (Krämer and Jalajel 2019). The MNOs benefit from the
partnerships with OTTs by adding the OTT services to their
Figure 2. Accumulative development of OTT partnerships (Amended
own portfolio in order to strengthen their customer loyalty and from Krämer and Jalajel 2019, p.212)
increase the MNOs usage, hence increases their footprint while stabilizing their revenues Krämer and Jalajel (2019).
Additionally, new revenue streams can be created by innovative technologies offered and developed by the OTTs
to the MNOs, so MNOs don’t need to invest in developing their own OTTs (Krämer and Jalajel 2019).
For example, the Malaysian Maxis offers Whatsapp and Facebook free usage along with their daily, weekly or
monthly bundles (Maxis 2020). Airtel is a vital example as well for partnering with OTT, when they partnered with
Amazon Prime and offered it to their customers in a bundle contains free calling and unlimited data (Airtel 2020).
Furthermore, Vodafone signed with Netflix and offered 12-month standard Netflex subscriptions to their
customers (Vodafone 2020). Mobaily, Viva, Ooredoo, STC and Nawras are also examples for parenting with OTT

providers (Knoben 2015). With the increasing partnerships and offered bundles to users, Infopulse (2019) explored
the consumers perspective of partnerships through a survey that showed 51% of consumers wished to access all
the video content they watch with a monthly fee regardless where it is published.
From the OTTs side, OTTs can benefit from the partnerships with MNOs to access their clientele and build a
global user base. Particularly, they can start to learn about mass communications, customer touchpoints, customer
acquisition from MNOs, which will benefit OTTs to gain market insights Krämer and Jalajel (2019). On the other
hand, the partnerships with OTTs entail risks to MNOs as well. It accelerates the market entry of new potential
competitors in telecommunication market which may result into further shrinking to MNOs market shares and
losing customer relations. For the OTTs the risk resides in the connectivity dependency they have on the MNO`s
infrastructure. The existence of MNOs from the cooperative venture might shut down OTTs operations
immediately and significantly harm OTTs` revenues (Krämer and Jalajel 2019). From one perspective MNOs are
confident that their services may gain popularity among consumers, however from the other side, MNOs are not
confident as their own services may get marginalized by OTTs, which push the MNOs to continue seeking other
strategies.
“Accept” Strategy
If not competing neither partnering, some MNOs have preferred a hands-off strategy to any application that may
upsurge in the data traffic usage, including the OTTs` services as well. Such MNOs are convinced that that
communications` services non-occasional nature such as messaging or voice over IP leads to intense incentives for
consumers to purchasing upgraded data plans. Those MNOs are trying to monetize the data traffic generated in
their network by OTTs (Czarnecki and Dietze 2017). Jalajel (2018) described this approach as the Zero strategy of
doing nothing towards OTTs, accepting the nature of OTTs proliferation, OTTs are increasing rapidly, and MNOs
must accept this fact. But in this research “Accept” strategy developed further besides the “zero-approach” to
include that MNOs have to develop alternative strategies to improve their business models, those strategies are not
overlapping with the OTT services. Accept can be the most suitable strategy to cope with the OTT providers. As
the OTTs proliferation is not just stopping here and more OTTs are developing every day. As evident in the online
video by John Legere (2018) CEO of T-Mobile USA in “First in” CNBC interview, explained that 4G technology
has created Uber, Airbnb, Snapchat and accelerated Amazon ,Facebook and Google, so with 5G innovation a whole
new group of entrepreneurs are looking for creating enormous new OTT applications. Legere (2018) claim is aligned
with Farooq and Raju (2019) conclusion that 5G is expected to evolve more in the world at 2020 with increase in
internet speed from 1000 Mbps to 5000 Mbps, which will place an intensive pressure on MNOs to expand their
infrastructure more, but again the main beneficiary of the new infrastructure will still be the OTT providers. 5G will
boost OTT providers and Internet of Things (IoT) companies to operate better with this high internet speed, which
will deteriorate the situation more for MNOs.
This means, applying the Compete or Partner strategies will be no longer effective in the near future as a new OTTs
are coming to the market. Additionally, with the first 2 approaches implementations, MNOs revenues are still
declining unlike the OTTs, as will be explored at data analysis section, so the strategies were not powerful enough
to overcome the impact of OTTs. Accordingly, MNOs must Accept OTTs, but with developing parallel strategies
to improve their business models. With the deep penetration of OTTs in people`s daily life and the difficulty to
stop it, MNOs have left with no choice to accommodate the OTTs traffic over their networks and without OTTs
paying for them. In this case MNOs should focus in optimizing their operational and capital costs, below are two
approaches for CAPEX and OPEX saving.
Network Virtualization to reduce CAPEX
Deploying the virtual RAN (Radio Access Network) reduces the network capital cost by 30%. Instead of the
expensive hardware equipment’s that MNOs need to build and expand their infrastructure networks to

accommodate the OTTs traffic. MNOs must think in emerging the software-based networks or so-called virtualized
networks which is 30% cheaper in the CAPEX requirements. In order to keep up with the constantly changing
market conditions, a fully virtualized networks allows the shift away from the tightly coupled hardware and software
traditional models to enable NVF (Network Functions Virtualization) technology. Krämer and Jalajel (2019)
supported this approach emphasizing that more service providers are emerging to offer virtualized infrastructure,
service orchestration and network function controllers. The Japanese giant, Rakuten, is a role model for the MNOs
to optimize their infrastructure cost, Amin (2019) CTO of Rakuten mobile has taken a revolutionary approach to
build world`s first end to end fully virtualized cloud native mobile network which commercially launched at April
2020. Amin (2019) emphasized that the journy they are embarking on in Japan enables the complete telecom
infrastructure buildout transformation. In only 12 months, Rakuten has built this network without a significant
CAPEX investment (Rakutentoday 2019). With a higher cost reduction achievement, Vodafone Group recently hit
a 50% capital cost reduction of its core network functions by wrapping up the deployment of VMware's network
virtual infrastructure at April 2020 across all its 21 business markets in Europe as reported by Robuck (2020).
Automation to reduce OPEX
Along with CAPEX reduction, Reith (2019) suggested that MNOs can focus on automation as operations
automations helps MNOs to reduce their OPEX. Applying a heavily automated managed services with a zero human
intervention will help to deliver better agility and QoS and improve customer`s experience in addition to the cost
reduction. Krämer and Jalajel (2019) elaborated that automation processes scope that can include configuration,
maintenance and troubleshooting and resource optimization. Automation of business processes was recommended
by Hong and Dietze (2019) as well, as it brings multiple opportunities to MNOs in efficiency and cost reduction.
Additionally, Schmitz et. Al (2019) concluded that robot process automation, stand-alone automation, Machine
learning, and Artificial Intelligence as optimum approaches for MNOs` automation. Czarnecki and Dietze (2017)
and O-RAN Alliance (2020) included automation and self-driving networks through learning-based technologies
and new software systems in their transformational recommendations to MNOs stressing in the cost advantages
that automation can bring to the MNOs` OPEX in addition to the ability to manage upcoming complex networks.
III.IVCombined researches proposals
Compete Accept Partner
As explored in the previous sections, several researches have

recommended different strategies for MNOs to react towards
OTTs threat. Farooq and Raju (2019) listed 18 researchers’
proposals in a table, however it was without any analysis or
conclusion. More researches have been gathered here in this
research up to 26, in addition to analytical approach to quantify the
significance for each recommended strategy after analysing and
mapping the recommended strategies into one of the 3 derived
strategies in this research (Compete or Partner or Accept). In order
to be able to give an overall bifurcation for all the recommendations Figure 3. Research’s recommendation breakdown - MNO strategies
towards OTTs (personal collection)
and measure the recommendations significance. The 26 researches
conclusions have been analysed and collected as shown at table 7 (amended from Farooq and Raju 2019, p.9). Figure
3 (personal collection) shows the bifurcation of the strategies with the percentage of the recommendations by the
researches. 19% of the researchers recommended competitive approach, while 27% suggested cooperation and the
popular recommendation were 54% supported the zero approach or the Accept strategy. This analysis shows the
popularity of the accept strategy that MNOs have to take, in order to control the impact of OTT providers. By

breaking down the 19% competitive approach results, results show 20% recommended blocking, 20% suggested
regulatory support and rest 60% proposed alternative innovative strategies to indirectly overcome the OTT impact.
Author Proposed strategy for MNOs to deal with OTT impact Strategy
(Monarat and Hitoshi 2019) According to the results, it is not preferable to regulate the OTTs similar to traditional telecom services Accept
(Schneider and Hildebrandt MNOs are likely to profit from the OTTs uprising trend as they are resulting into an increase of consumers’ willingness-to- Accept
2017) pay for MNOs mobile access. In fact, consumers use the two types of communications services very differently.
(BEREC 2015) MNOs can attract new customers base and reduce churn by seek partnerships with OTTs. That will increase MNOs` data Partner
revenue and add value to their services.
(Farooq and Raju 2019) Farooq and Raju (2019) has proposed an innovative idea to decrease the gap existing in the OTT services market. The Partner
MNOs can provide a combined platform that merge all OTTs enabling the interconnectivity between different OTTs.
(Infopulse 2019) Now it’s time for MNOs to invest more in building superior digital touchpoints with customers to improve customer Accept
experience
(Barclay 2015) MNOs to push for regulatory option Compete
(Kwizera et al. 2018) MNOs to push for regulatory option Compete
(Joshi et al. 2016) MNOs to push regulators for revenue`s sharing models between OTTs and MNOs Compete
(Krämer, 2019) MNOs shall partner with OTTs which can resolve the ongoing problem Partner
(Nooren et al., 2012) MNOs get benefits from OTT players as it creates opportunities for telecom companies Accept
(Borowski and Khurana 2019) MNOs should focus on investing in 5G and monetizing its data traffic. Accept
(Schmitz et al. 2019) Robot process automation, stand-alone automation, Machine learning, and Artificial Intelligence are optimum approaches Accept
for MNOs` automation to reduce OPEX.
(Hong and Dietze, 2019) Automation will bring multiple opportunities to MNOs in cost optimization, by business process automation, AI, M2M Accept
(Wisselink and Schneider 2019) MNOs to invest in IOT related products. Accept
(Grineisen and Rehme, 2019) MNOs to create their own OTT services applications. Compete
(Glohr, 2019) MNOs to focus on monetizing the data usage by their business consumers. Accept
(Obernolte et al. 2019) MNOs will gain revenues for the high OTTs penetration. Accept
(Eberhard and Heuermann, MNOs to focus in open access internet broadband deployment via the mobile wholesale network. Accept
2019)
(Steingröver et al. 2019) MNOs to urge authorities to regulate OTTs or MNOs to block the OTT services Compete
(Heilen, 2019) MNOs to cooperate with OTTs Partner
(Weber et al. 2019) MNOs to focus in cost optimization through managing the energy sources such as low power wide area networks as a game Accept
changer for the IoT.
(Lukowski et al. 2019) MNOs to focus in machines connections that will reach 21 billion connections in2021 Partner
(Heinemann et al.2019) MNOs can compete focusing in digitization of Health, transportation, education Accept
(Reith 2019) MNOs can compete with a focus on Automation as cost optimization Accept
(Korzunowicz 2019) MNOs to help OTT companies in going through technology stability & change Partner
(Krüssel and Göbel 2019) Network expansion and optimization to provide and improve quality of OTT Services Partner
Table 7. Combined researchers’ proposals for MNOs strategies towards OTTs (amended from Farooq and Raju 2019, p.9)
IV Data and analysis
IV.I Major telecom trends analysis in the era of OTTs
Following the literature review, this section huddles in and build out the major mobile telecommunications industry
trends that been impacted by the emergence of OTTs in order to examine the variations to support resolving the
controversy about the OTTs impact on MNOs. Starting from 2020`s mobile telecommunications industry
dashboard shown at Figure 4 (personal collection) that includes the key telecommunications` industry measures at
2020. The dashboard proofs that that telecommunications industry is a successful industry in the new millennium.
Mobile users’ numbers reached 5.2 Billion out of 7.77 Billion total population in the world with a penetration rate
of 67%. The total revenue recorded in 2019 is 1.032 $ Trillion and ARPU 13.56 $. MNOs are delighted with this
revenue and investing more in modernizing their networks to serve more users.
Total population Mobile users Penetration Total revenue ARPU

•7.77 Billion •5.2 Billion •67% •1.032 Trillion $ •13.565 $
Figure 4. 2020`s mobile telecommunications industry dashboard (personal collection).
Although Figure 4. reflects the telecom industry success, the OTTs have significantly impacted those values. The
severe impact of OTTs on MNOs represented in smartphones, LDC, SMS, voice calls and traffic, are analysed
below:

Smartphones
Mobile types` connections shown at Figure 5(amended from GSMA 2020b)

reproduces the first impact brought by OTTs to telecommunications
industry. As shown at the figure, the feature phones which grant the
customers to perform voice calls and send SMS only, were degrading
significantly after reaching its peak at 2011. On the other hand, the
smartphones which grants the customers to use OTTs, were rapidly
increasing starting from 2008 along with increase in mobile-data only
connections. Based on the capabilities of the feature phones in comparison
to the smartphones, this trend indirectly emphasis a degradation in Figure 5. Mobile types` connections (amended from GSMA 2020b).
traditional voice and SMS confronted by a massive increase in OTTs usage.
LDC
International conversational voice minutes traffic shown at Figure 6

(amended from Telegeography 2019) illuminates the impact of OTTs on
MNOs` LDC number globally. The international conversational voice
minutes number was increasing for MNOs till 2012 where it commenced to
decrease afterwards, on the other hand the international voice minutes
carried over OTTs started to increase since the beginning and exceeded the
MNOs minutes number at 2016. By comparing 2017 vs 2012, the MNOs`
international calls minutes number decreased by 17% from 617 to 514
million minutes. At the same period, the OTTs` international minutes Figure 6. International conversational voice minutes Traffic (Million
Minutes) (amended from Telegeography 2019).
number increased by 354% from 160 to 727 million minutes. The difference
is remarkable and accentuates the negative impact of OTTs on MNOs. This highlights that the OTTs are
aggressively replacing MNOs` LDC service which is a main source of revenue for MNOs along the years.
SMS
Similar to LDC trend, the global SMS number trend is sharply decreasing as
well, as shown at Figure 7 (amended from ITU 2018, p.7). The decrease of
MNOs` SMS number is accompanied with exponential increase of OTTs`
IP messaging number and a slight increase of MNOs` IP messaging. Unlike
the LDC that started decreasing at 2012, the SMS trend of MNOs started
decreeing 1 year earlier. By applying the same comparison of 2012 vs 2017
of LDC, the MNOs SMS number decreased by 17%, surprisingly it is same
degradation value as LDC. On the other hand, the OTTs messaging number Figure 7. Mobile Messaging by service type (Trillion
increased by 967% from 3 to 32 trillion messages, which is around 3 times Messages) (amended from ITU 2018, p.7).
more than the increase of OTTs` LDC. The difference in the OTTs` growth in SMS vs LDC support the analysis
done at the literature review section, table 4, p.15 , that the OTTs are much advanced and closer to customers in
the messaging service that’s why their growth rate is 3 times higher than LDC.
However, in the LDC there are limitations in OTT services that their applications are not capable of calling
international mobile number if compared to MNOs, which limits their growth rate. The massive growth and
advancements of OTTs messaging service ensures that the SMS is more danger to MNOs to be replaced by OTTs`
messaging. By applying linear regression followed by extrapolation on the quarterly SMS number reported by GSMA
(2020b) from all global MNOs as shown at figure 8 (personal collection). SMS will approximately vanish by Q4
2022. The SMS data reported in GSMA (2020b) is quarterly if compared to annual data reported by ITU (2018).
The degrading trend of SMS number has resulted into a degradation in ARPU of messaging services globally for

MNOs as shown at Figure 9. (personal collection) with a sharp drop at 2012 which is the turnover year when SMS
number started to decrease after the increasing trend.
Figure 8. Global SMS number (Billion Messages) (personal collection) Figure 9. MNO`s messaging ARPU (personal collection)
Voice calls
While the LDC and SMS shows a sharp drop in usage by MNOs`
customers, oppositely the voice calls trend is showing sustainability
in increasing minute of use as shown at Figure 10 (amended from
GSMA 2020b). The increasing trend of MNOs voice calls supports
the analysis done at table 5, p. 17, which concluded that MNOs`
voice calls are fulfilling the customers` need if compared to OTTs`
limited capabilities of voice calls. One of the reasons is that OTTs
voice calls have limitations to call fixed line numbers and MSIDN
numbers. The trend shows that OTTs have not succeeded yet to
Figure 10. Total Minutes of use (Mobile) (Trillion Minutes) (amended from
decrease the MNOs` voice call services unlike the SMS and LDC. GSMA 2020b)
Data traffic
Figure 11. (amended from Ericsson 2019 and Cisco VNI 2017)
shows the sustainable increase in global data traffic in download
and upload services every quarter. The tremendous traffic increase
is aligned with the increase of smartphones trend as in Figure 5,
p. 24. Cisco VNI (2017) reported this increasing data trend and
additionally predicted a 1100% growth in data traffic over
smartphones by 2021 if compared to 2014. A remarkable increase
in data traffic started at 2014, the reason behind this increase as
justified by GSMA intelligence (2020a) is that the demand for data
capacity grew quickly during the 4G era as consumers were using (Amended
Figure 11. Data Download+Upload in Exabytes (Billions of Gigabytes)
from Ericsson Mobility Report,2019,p.12, and Cisco VNI 2017)
mobile broadband more. Accordingly, the main source of MNOs`
revenues shifted from LDC, voice minutes and SMS to data traffic. In order to manage the increasing data`s demand,
MNOs have thought to increase network capacity while reducing the network`s costs, which has been achieved
through investments in new generations of mobile technologies, each of which is more efficient at handling data
traffic.
The 5 major telecommunications` trends analysis done confirms that OTTs have significantly impacted and
reshaped the MNOs trends globally. However, in order to conclude whether those variations have negatively or
positively impacted the MNOs, the revenue trend analysis will be the decisive factor to judge the impact as examined
below.

IV.II Revenue analysis
As illustrated at figure 4, p. 24, the MNOs have registered total revenue of 1.032 Trillion $ at 2019. The number
reflects a great achievement and success of telecommunications industry. In order to deeply explore and analyse the
revenue and ARPU trends, the total period of study from 2008 till 2025 have been divided into 3 phases where each
period has got different characteristics. As concluded in the major trend’s analysis, the MNOs traditional services
were increasing till 2012, which presents a successful period for MNOs then the turnover year was 2013 when it
started to degrade after. Accordingly, Phase I period has been chosen from 2008 till 2013. Phase II started from
2014 till 2019 which is the present, at this period the OTTs have been evolving fast and has severely reshaped the
MNOs trends. Phase III starts from 2020 till 2025 which includes forecasted trends of how MNOs revenues will
continue.
Phase I – Successful Phase for MNOs
The revenue is increasing steadily at phase I as shown below at Figure 13 (personal collection). The MNOs have
been generating highest revenues during this phase from LDC, SMS and voice calls. With this increasing trend, the
average revenue growth rate was 12.38 % each year. The ARPU average per year during this phase was 21.7 $
generated from an average subscribers’ number of 3.34 billion per year. With these positive indicators, phase I is
considered as the reference to evaluate phase II and III. Regression analysis have been done on the available
quarterly and annual data of phase I with year number and revenue values as data sets. The analysis results in a
positive growing linear trend line with equation of y=39.836x+729.63, where y is revenue, and x is the year number.
In order to test the accuracy of the derived model formula, the actual revenue of phase I is compared to the revenue
derived from the regression analysis as shown at table 8 (personal collection) and Figure 12 (personal collection).
The predicted revenue is similar to the actual revenue with an acceptable error rate average of 6.2%. This underlines
the accuracy of the derived model and confirms the validity for it to be used to predict the revenues over the years
in phase II and Phase III.
Actual Revenue derived from regression

Phase Year revenue analysis [y=39.836x+729.63] Error rate %
($ Billion) ($ Billion)
Phase I 2008 776.84 816.88 5.2%
Phase I 2009 804.27 859.25 6.8%
Phase I 2010 838.85 901.63 7.5%
Phase I 2011 892.97 944.00 5.7%
Phase I 2012 934.94 986.37 5.5%
Phase I 2013 966.47 1028.74 6.4%
Table 8. Regression analysis model error rate % (Personal collection)
Figure 12. Actual revenues vs predicted revenue

(personal collection)

Phase II – Declining MNOs` Phase with OTT evolution
As phase I is the success reference for the other two phases,

the derived trend from regression analysis of phase I Phase I Phase II Phase III
(y=39.836x+729.63) has been used to extrapolate the
predicted revenue over phase II and phase III as shown at
Figure 13 (personal collection). The actual revenue trend at
phase II is increasing, however, as it is obvious from figure
13., the predicted revenue is increasing more rapidly. This
means that the revenues after 2013 was increasing, however
not with the same growth rate it was increasing in the
successful era of phase I. The difference between the actual
revenue in phase II and the predicted revenue is considered
as the revealed hidden revenue loss in this research which is
the grey area in the graph shown at Figure 13. The MNOs
were delighted with their actual revenue trend increasing with Figure 13. Revenue analysis (personal collection)
function of (y=16.365x+878.78), but it shall be increasing

with function of (y=39.836x+729.63) referring to phase I as a baseline. The revenue losses numbers of MNOs at
phase II is shown below at table 9 (personal collection). MNOs have registered a revenue loss along phase II starting
from 2014 till 2019, with an average loss of 175 $ Billion per year. The losses were increasing every year reaching
250 $ billion at 2019.
Phase Year Actual Revenue (Billion) $ Predicted revenue derived from regression analysis Revenue loss ($ Billion)
[y=39.836x+729.63] ($ Billion)
Phase II 2014 974.88 1071.11 96.23
Phase II 2015 985.66 1113.49 127.83
Phase II 2016 991.17 1155.86 164.69
Phase II 2017 1006.44 1198.23 191.79
Phase II 2018 1020.79 1240.60 219.81
Phase II 2019 1032.03 1282.97 250.94
Table 9. Revenue losses of MNOs at Phase II (Personal Collection)
This analysis emphasis the serious issue that MNOs are facing and the negative impact on MNOs that OTTs
evolution brought at Phase II specifically.
In order to evaluate the OTTs` trends and further illustrate the revenue shift from MNOs to OTTs. Facebook OTT
app has been selected here to evaluate the OTTs performance while MNOs revenue are recording losses. As shown
below at Figure 15 (amended from Facebook 2019 and GSMA 2020b), while MNOs ARPU trend is decreasing over
the years, Facebook ARPU is rapidly increasing and have crossed MNOs` ARPU at 2016. This means that Facebook
generate a revenue from a single user equal to the revenue MNOs generating at 2016. Afterwards, the MNOs ARPU
continued to decrease while Facebook ARPU was increasing till it reached 25 $ at 2018 when MNOs` ARPU
recorded 14 $.
After concluding the revenue loss of MNOs using regression followed by extrapolation analysis, exact same
methodology has been applied on Facebook`s revenue as shown at Figure 14 (personal collection). Surprisingly,
while searching a similar revenue loss for Facebook, the results shows a totally opposite case. In Facebook it is not
revenue loss, however it is revenue excess. As shown at figure 14 the revenue trend should be increasing with the
predicted grey trend; however, the actuality is it is increasing much more than predicted! Table 10 (personal
collection) shows the quantified revenue excess that Facebook is generating annually that reached 41 $ Billion at
2018. By looking into table 9 and table 10 together, the revenue excess that Facebook generated every year, is a
portion of the revenue losses that MNOs registered. While rest of the MNOs` revenue losses went to other OTTs.

Figure 15. MNOs` vs Facebook ARPU (amended from Facebook 2019 Figure 14. Facebook Revenue vs Estimated revenue growth and ARPU (personal
and GSMA Intelligence 2020) collection)
Phase Year Actual Revenue (Billion) $ Predicted revenue derived from regression analysis Revenue excess ($ Billion)
[y=39.836x+729.63] ($ Billion)
Phase II 2014 12.47 8.55 3.92
Phase II 2015 17.93 10.05 7.87
Phase II 2016 27.64 11.56 16.08
Phase II 2017 40.65 13.06 27.59
Phase II 2018 55.84 14.57 41.27
Table 10. (Personal collection)
While the MNOs are registering this massive

increasing revenues losses year by year. MNOs
are under pressure to increase their expenditures
in CAPEX and OPEX as shown at Figure 16.
(amended from GSMA 2020b) in order to
accommodate the data traffic increase caused by
OTTs and willing to maintain the customer
experience of network`s quality and data speeds.
The forced increase in OPEX and CAPEX
drives further revenue losses to MNOs unless
MNOs follow strategies to decrease expenditures
in Phase III.
Figure 16. Average CAPEX and OPEX global MNOs (amended from GSMA 2020b)
Phase III – Opportunity to recover the

losses
If the situation remains the same and MNOs will not proactively react against OTTs, the hidden revenue losses will
continue to increase as shown at table 11 (personal collection). The MNOs will register a significant loss of 423 $
Billon at 2025. MNOs will be officially a set of pipes that transmitting the OTTs` content, unless the will take serious
actions to modernize their business models by implementing proper strategies in order to attract their customers
back to their services.
Phase Year Actual Revenue (Billion) $ Predicted revenue derived from regression analysis Revenue loss ($ Billion)
[y=39.836x+729.63] ($ Billion)
Phase III 2020 1060.13 1325.35 265.21
Phase III 2021 1072.86 1367.72 294.86
Phase III 2022 1084.79 1410.09 325.30
Phase III 2023 1094.55 1452.46 357.91
Phase III 2024 1102.41 1494.83 392.42
Phase III 2025 1113.45 1537.21 423.75
Table 11. Phase III predicted revenue losses (personal Collection)

As per GSMA (2020a), MNOs planning to invest $1.1 trillion globally in the next five years in their networks. Will
OTTs again absorb this investment, or MNOs will follow recommendations to deal with OTTs and modernize their
business models?
V Recommendations
So far, the traditional MNOs, with their response to OTT competition, have been more reactive, rather than
proactive. Taking a more proactive stance, ensures a higher and faster return on investment. It is not late for MNOs
and telecommunications industry to reclaim lost grounds from OTTs. MNOs have the experience and the right
DNA to cope with the situation and turn the table around. Below are major recommendations that MNOs shall
follow in order to recover the losses and get their shifted-out customers back.
Fill the gap: with the gap analysis done comparing MNOs vs OTTs voice and messaging services features, MNOs
shall fill the gap in their offered services and get closer to customers` needs in order to compete with OTTs. Now
it is the right time to act, if MNOs are yet to address their customer`s changing demands.
Quantify the losses and set targets: Following the hidden loss reveal model developed and examined in this
research, MNOs shall apply this model to quantify their losses after defining their success era as a reference.
Quantifying the hidden loss reveals the significance of the issue that MNOs encounter, accordingly, helps to set a
proper strategy.
Apply appropriate strategy: The 3 strategies explored at this research are not necessarily to be mutually exclusive
as MNOs should be active in different areas. Categorize your OTTs into 4 groups and 2 dimensions as shown at
Figure 17 (personal collection). First dimension is the size of the OTT whether it is big or small based on the usage
and popularity in the country where the MNO
exist. Second dimension is the overlapping level
with the offered services, indirect overlapping
and direct based on the offered MNOs` services
intersection with OTTs` services. 4 sets of
strategies are recommended as shown at figure 17
based on the 2 dimensions:
Group 1: The OTTs` apps and services which

having additive value and may provide access for
MNOs to a new target segment of subscribers
which can increase their revenues. Such OTTs are
Figure 17. Recommendations (personal collection)
firmly established and already have developed a
substantial strength in market of music and video. Netflix and Spotify are examples for entertainment type of
services in video and music where it can increase MNOs previously limited footprint in these sectors. MNOs have
to deal with this group as volume partners to open new market segments or at least to limit their customer churn.
For this group the recommended strategy is “Partner”.
Group 2: The OTTs that offering indirect-overlapping services with MNOs however it is smaller in volume if
compared to group 1. Truebill is an example that offers subscriptions tracking services to users that enables them
to pay for services using their mobile account. Such OTT can be a value partner to MNOs as it expands their
footprint in new areas and represents a value enlargement to MNOs. However, partnering with this group of OTT
entails a high flop risk; engaging into partnering in their early development stage before their hype is advantageous
for MNOs. For this group the recommended strategy is “Accept”.

Group 3: While group 1 and 2 of OTTs are not overlapping with MNOs offered services, group 3 has immediate
overlap with the offered MNO`s services and entails the major contribution in MNO`s revenues losses. The larger
and more competitive the OTT is, the more “Compete” strategy is recommended to be applied by MNOs. As these
portions of OTTs such as WhatsApp and Skype are largely overlapping with offered MNOs services of voice, SMS
and LDC so it is more appropriate for MNOs to pursue a strategy of “Compete”. While four different “compete”
strategies discussed at previous section, create own OTT is the most suitable in the current market.
· Blocking group 3 OTTs is not a recommended option due to the popularity and the deep penetration of
OTTs in the society. As well, OTTs are offering social responsibility services which help the society in different
fields.
· Attack is the best form of defence: Create own OTTs to compete. With the big customer data that MNOs
own, MNOs shall analyse their customer behaviour and develop own OTT app that perfect match their
customers and can compete with OTTs. A combined OTT app that includes messaging, voice calls and
international calls services with interconnectivity ability to communicate with other existing OTTs, is a
suggested OTT.
Group 4: OTTs are smaller in size if compared to group 3, their offered services are directly overlapping with
MNOs services such as messaging services. They are not presenting high risk on MNOs due to their limited
footprint. For such OTTs MNOs shall apply “Accept” strategy. Also, MNOs can acquire such OTTs and develop
them to compete with group 3, rather than creating a new OTT app from scratch.
Reduce OPEX and CAPEX by Automation and v-RAN, reduction of OPEX will be achieved by network
operations automation with a zero human intervention vision. And reduction of Capex will be achieved by
modernizing the networks infrastructure to be software centric rather than expressive stagnant hardware-based
networks. With the upcoming IOT, 5G and more demanding applications, networks will be extremely complex
which will fail to run with the traditional human means to deploy, optimize and operate. It is now mandatory for
MNOs to adopt automated learning-based technologies to enable self-driving networks.
VI Conclusion
With a thorough review of mobile telecommunications trends, variations, and issues during the whole last decade,
it is found that telecommunications industry represented in MNOs has reached its peak of success during 2014 then
started deteriorating. There are many factors impacted this declining trend, however it has been proven that one of
the genuine factors is the evolution of OTTs. From one hand OTTs introduction have led to increase in customers
numbers, smartphones and data traffic which forced the MNOs to invest in modernizing their infrastructure to
accommodate the increased myriad users’ numbers and the tremendous traffic. On the other hand, OTTs have
significantly absorbed traditional LDC, voice calls and messaging services from MNOs. The 6 variations in total
have led to losses in MNOs` revenues as summarized at figure 18 (personal collection). It has been concluded that
the major impacted revenue stream is the SMS and it is predicted to vanish by Q4 2022.
Figure 18. OTTs impact on MNOs (personal collection)

It has been concluded that OTTs have won the battle in the last decade to compete and attract the customers due
to their modern offered services which fulfill the customers` needs, unlike the MNOs who have not upgraded their
offered limited services` features, this resulted into exponential increase in the usage of OTT services and aggravate
the situation of MNOs. OTTs have succeeded in turning the MNOs to reactive technology suppliers rather than
proactive. The revenue trend analysis of MNOs during last decade and the correlation with OTT trends proofs that
OTTs were threat on MNOs. The less impacted period was from 2008 till 2013 where MNOs revenues were
growing steadily however after 2013 the revenue growth started declining. Although the upcoming 5 years trends
of MNOs are expected to continue declining, it can be the opportunity to MNOs to recover and get back as the
market leaders. Table 12 (personal collection) concludes the major KPIs of global telecommunication industry in 3
phases. This research gives insights for MNOs and regulators to review the severe impact of OTTs on MNOs in a
quantified number that shows the significance of this impact.
Table 12. MNOs` KPIs comparison (personal collection)
It has been concluded that all the previous proposed strategies can be categorized into three holistic approaches of
Compete, Partner and Accept. The analysis shows Accept was the most recommended strategy by 54% of the 26
revised researches, followed by 27% Partner and 19% Compete. Unlike other researches that focused on one
approach, it was recommend in this research to apply different strategies based on the OTT size and the level of
overlapping between MNOs and OTTs offered services. In the background the MNOs must accept the fact that
OTTs are using their networks and will continue using. Instead of expanding their network infrastructure only,
MNOs must decrease CAPEX and OPEX of their networks by applying the virtualized networks and the
automation that can save up to 30% of their expenditures. The reason behind promoting Accept strategy is that the
proliferation of OTTs is not stopping here, however it is concluded that the 5G will empower the current OTTs
with better speeds and low latency and will generate a new wave of OTTs in the near future.
The OTT impact on MNOs subscribers have been analyzed in this research, however with the introduction of IOT,
the MNOs will provide connections to the machines including cars, hospitals, drones, etc. Who will monetize the
connections of the machines? is it the MNOs who provide the connectivity, or the new wave of the OTTs will ride
into the scene again? The new wave of OTTs and their impact on MNOs is a topic yet to be explored in researches.
REFERENCES
[1] Athow, D., 2015. Why network operators must embrace innovation – and OTTs – to survive [Online]. California: Techradar. Available from:
https://www.techradar.com/news/phone-and-communications/why-network-operators-must-embrace-innovation-and-otts-to-survive-1286103 [ Accessed 01 Feb
2020].
[2] Barclay, C. (2015). An exploratory study of the Caribbean market. In 2015 ITU Kaleidoscope: Trust in the Information Society, IEEE[Online]. Available from:
https://doi.org/10.1109/Kaleidoscope.2015.7383647.
[3] BEREC, 2016. Draft BEREC Report on OTT services. BEREC[Online], 142(15)10-20. Available from:
https://berec.europa.eu/eng/document_register/subject_matter/berec/public_consultations/5431-draft-berec-report-on-ott-services[ Accessed 06 March 2020].
[4] Bhawan, M., Marg, J., 2015. Regulatory Framework for Over-the-top (OTT) services. [Online]. Available from:
https://www.thehinducentre.com/multimedia/archive/02376/TRAI_Regulatory_Fr_2376040a.pdf [Accessed 01 April 2020]
[5] BMI, 2018. United States Telecommunications Report Includes 5-year forecasts to 2022. USA: Business Monitor International Ltd. BMI Research.
[6] Buzdar, M., Kurshid, M., Janjua , S., 2016. Customer-based brand equity and firms’ performance in the telecom industry. International Journal of Services and
Operations Management[Online], 25(3). Available from: https://doi.org/10.1504/IJSOM.2016.079516[ Accessed 01 March 2020]
[7] Byjus, 2018. Extrapolation[Online].BYJU'S. Available from: https://byjus.com/maths/extrapolation/[ Accessed 04 April 2020]
[8] Cataldo,C.,2016. how the pay-TV industry is evolving and its innovation priorities. Available at: https://dtv.nagra.com/charles-cataldo-manager-technical-services-
directv-att-shares-his-views-how-pay-tv-industry-evolving.[accessed 23 March 2020].
[9] Cisco, 2018. Cisco Visual Networking Index: Global Mobile Data Traffic Forecast Update, 2013–2018.Cisco [Online]. Available from:
http://www.cisco.com/c/en/us/solutions/collateral/service-provider/visual-networking-index-vni/white_paper_c11520862.pdf [accessed 04 March 2020].
[10] Crawshaw,J. , 2017. The state of digital transformation in telecommunications. Heavy reading [Online]. Available at: http://telecoms.com/wp-
content/blogs.dir/1/files/2017/05/HR-Comarch-Digital-Transformation-WP-5-4-17.pdf [accessed 18 March 2020].
[11] Czarnecki,C. and Dietze,C., 2017.Reference Architecture for the Telecommunications Industry.1st edition. Cham, Switzerland: Springer Nature.
[12] Economist Intelligence Unit (EIU), 2018. Telecoms in 2018. A special report from The Economist Intelligence Unit. Available: http://pages.eiu.com/rs/753-riq
438/images/telecoms_in_2018.pdf?mkt_tok=eyjpijoiwmpzefl6wxpnrekytjjkbcisinqioijstux4k1yzntjlnjfjn0zud1vrzmhyrggyugdgunjwzmlwv3a3edzozuzhotjrtvdoqnozt
ddkahzjtglvmjdsoxziaklqrghpc3fkxc9tq212vkjgvddqzjg0y2nuahzcdnpiofdsc3vyt1nirhjom0jeqtbnwgfuahlxrgfqawsifq%3d%3d. [Accessed 04 April 2020].
[13] Economist Intelligence Unit (EIU), 2020. Telecoms in 2020. Available: https://pages.eiu.com/Dec-19-Telecoms-in-2020-Subscription---New-Business_registration-
page.html. [Accessed at 06 March 2020].
[14] Esmailzadeh, R., 2016. Broadband Telecommunications Technologies and Management. USA: John Wiley & Sons.
[15] Esselaar,S. Stork,C, 2018. OTTs driving data revenue growth. Conference: The 22nd Biennial Conference of the International Telecommunications Society At: Seoul.
Available from: [https://www.researchgate.net/publication/325987960_OTTs_Driving_data_revenue_growth].

[16] ETSI, 2015. 3GPP TS 23.002 version 12.6.0 Release 12.ETSI [Online], TS 123 002 V12.6.0 (2015-01). Available from:
https://www.etsi.org/deliver/etsi_ts/123000_123099/123002/12.06.00_60/ts_123002v120600p.pdf[ Accessed 01 April 2020 ]
[17] ETSI,2013. Digital cellular telecommunications system (Phase 2+).3GPP TS 23.228 version 11.10.0 Release 11[Online]. Available from:
https://www.etsi.org/deliver/etsi_ts/123200_123299/123228/11.10.00_60/ts_123228v111000p.pdf [ Accessed 29 March 2020]
[18] ETTelecom, 2020. Telcos’ voice revenue to drop 45% by 2024 under a growing OTT challenge: Study[Online]. UK: ETTelecom.com. Available from:
https://telecom.economictimes.indiatimes.com/news/telcos-voice-revenue-to-drop-45-by-2024-under-a-growing-ott-challenge-study/73120543[ Accessed 15 March
2020]
[19] Facebook,2018. Facebook Annual report 2018[Online].Available from: https://s21.q4cdn.com/399680738/files/doc_financials/annual_reports/2018-Annual-
Report.pdf[ Accessed 15 March 2020]
[20] Facebook,2017. Facebook Annual report 2017[Online]. Available from:
https://s21.q4cdn.com/399680738/files/doc_financials/annual_reports/FB_AR_2017_FINAL.pdf[ Accessed 15 March 2020]
[22] Facebook,2015. Facebook Annual report 2015[Online]. Available from: https://s21.q4cdn.com/399680738/files/doc_financials/annual_reports/2015-Annual-
Report.pdf[ Accessed 15 March 2020]
[23] Facebook, 2014. Facebook Annual report 2014[Online]. Available from:
https://s21.q4cdn.com/399680738/files/doc_financials/annual_reports/FB2014AR.pdf[ Accessed 15 March 2020]
https://s21.q4cdn.com/399680738/files/doc_financials/annual_reports/FB_2012_10K.pdf[ Accessed 15 March 2020]
[26] Facebook,2019. [Online]. Available from: https://investor.fb.com/financials/default.aspx[ Accessed 10 March 2020]
[27] Farooq , M., Raju, V.,2019. Impact of Over-the-Top (OTT) Services on the Telecom Companies in the Era of Transformative Marketing.Global Journal of Flexible
Systems Management[Online], 20(2)177-188. Available from: https://www.researchgate.net/publication/332251064_Impact_of_Over-the-
Top_OTT_Services_on_the_Telecom_Companies_in_the_Era_of_Transformative_Marketing[ Accessed 01 April 2020]
[28] Farooq , M., Jabbar , Z., 2014. Role of Word of Mouth in building CBBE.[Online], 73(2014). Available from:
http://www.elixirpublishers.com/articles/1408768877_7 3 (2014) 26443-26447.pdf[ Accessed 15 March 2020]
[29] Firtz,M.,Schlereth,C.,Figge,S.,2011. Empirical Evaluation of Fair Use Flat Rate Strategies for Mobile Internet.Business & Information Systems Engineering[Online],
3(5)269-277. Available from:
https://www.researchgate.net/publication/220618604_Empirical_Evaluation_of_Fair_Use_Flat_Rate_Strategies_for_Mobile_Internet[ Accessed 30 March 2020]
[30] Fowora,D., Awodele,O., Olayinka,O., Aduragbemi,O.,2018. The Impact of OTT Services in Nigeria: Regulators, Operators and Customers Perspective. Global
Journal of Computer Science and Technology: Interdisciplinary. [Online]. Available from:
https://computerresearch.org/index.php/computer/article/view/1687/1671.Volume 18 Issue 2 Version 1.0.
[31] Goldstein , P., 2013. Report: Skype Makes Up One-Third of All International Phone Traffic[Online]. FierceWireless. Available
from:https://www.fiercewireless.com/wireless/report-skype-makes-up-one-third-all-international-phone-traffic.[ Accessed 07 April 2020]
[32] Grant,M., Sen,B., And Spring,H., 2013. Research, Evaluation and Audit, Key steps in demonstrating your value. London: Facet publishing
[33] Grove, L., 2004. Writing winning proposals for research funds. Technical Communication 2004.
[34] GSMA Intelligence, 2020. The mobile economy 2020[Online]. United Kingdom: GSM Association. Available from: https://www.gsma.com/mobileeconomy/wp-
[35] content/uploads/2020/03/GSMA_MobileEconomy2020_Global.pdf[ Accessed 01 March 2020]
[36] GSMA Intelligence, 2020. GSMA[Online]. UK: GSMA Ltd. Available from: https://data.gsmaintelligence.com/data/custom-metrics-search[ Accessed 04 April 2020]
[37] Heuermann, A.,2019. OTTs Versus Telcos: Network Neutrality and Operator Strategies. In:Krüssel,P.,eds. Future Telco Successful Positioning of Network Operators
in the Digital Age.Cham, Switzerland:Springer Nature Switzerland AG, 251-261.
[38] Hong,C.,Dietze,C.,2019. Smart Automation as Enabler of Digitalization? A Review of RPA/AI Potential and Barriers to Its Realization. In:Krüssel,P.,eds. Future
Telco Successful Positioning of Network Operators in the Digital Age.Cham, Switzerland:Springer Nature Switzerland AG, 349-358.
[39] Infopulse, 2019. ADDRESSING OTT PITFALLS: KEY STRATEGIES TELCOS AND MNOS SHOULD INTRODUCE[Online]. USA: Infopulse.
[40] IPCarrier,2013. A chronicle of business model change and end user transformation in the global communications industry [Online]. Available from:
https://ipcarrier.blogspot.com/2013/04/china-sms-usage-drops-11-ott-is-reason.html [Accessed 17 March 2020]
[41] Joshi,S., Rohit,D., Rohan,E., Akshara,C. , 2016. Telecom-OTT Partnership: Generating New Revenue Sharing Models. Telecom Business Review; New Delhi. Vol. 9,
Iss. 1, (2016): 21-31.
[42] Kastrenakes, J., 2018. AT&T finishes acquiring Time Warner, becoming massive media conglomerate [Online]. : Theverge. Available from:
https://www.theverge.com/2018/6/14/17466518/att-time-warner-acquisition-closes[ Accessed 03 April 2020]
[43] Kent, J., 2018. Deutsche Telekom takes MagentaTV OTT offering standalone[Online]. England: Informa PLC Informa UK Limited. Available from:
https://technology.informa.com/607530/deutsche-telekom-takes-magentatv-ott-offering-standalone[ Accessed 30 March 2020]
[44] Knoben, W., 2015. The Rise of OTT Players– The Regulatory Answer?[Online]. Kuala Lumpur: Detecon Asia-Pacific Limited. Available
from :https://www.itu.int/en/ITU-D/Regional-Presence/AsiaPacific/Documents/Events/2015/Aug-
ITP/Presentations/ITU%20Conference%20Kuala%20Lumpur%20-%20Dr.%20Werner%20Knoben%20-%20Detecon.pdf [Accessed 20 March 2020]
[45] Kothari,R., 2004. Research Methodology: Methods and Techniques. London: New Age International.
[46] Kraemer , C., 2017. Partenering Excellence Win the Partners [Online]. Germany: Detecon International GmbH.
[47] Krämer,C. and Jalajel,R.,2019. OTT Partnering with Telcos: On the Rise A Situational Partner Management Approach. In:Krüssel,P.,eds. Future Telco Successful
Positioning of Network Operators in the Digital Age.Cham, Switzerland:Springer Nature Switzerland AG, 211-218.
[48] Krstevski, D., Mancheski, G., 2016. Telecom Cost Optimization: How to Subsidize Handset Subsidie. Economic Development No. 3/ 2016 p. (255-266)
[49] Kwizera,E., Mico,D., Nayebare,M., Aminata A., Saint,M.,Linda G.,2018. The Impact of over the Top Service Providers in the Rwandan Telecommunications Market:
An Analysis of Business Models: Second International Conference, InterSol[Online]. Available
from :https://www.researchgate.net/publication/327291185_The_Impact_of_over_the_Top_Service_Providers_in_the_Rwandan_Telecommunications_Market_An
_Analysis_of_Business_Models_Second_International_Conference_InterSol_2018_Kigali_Rwanda_March_24-25_2018_Procee.
[50] Lavrakas,P., 2008. Trend Analysis. Available from:http://methods.sagepub.com/reference/encyclopedia-of-survey-research-methods/n589.xml/ [Accessed 05 March
2020].
[51] Linnhoff-Popien, C.,Schneider,R., Zaddach.M.,2017. Digital Marketplaces Unleashed. Germany: Springer international publishing.
[52] Lobb, M., 2018. Introducing Vodafone TV™, and our revamped Vodafone nbn™ plans[Online]. Australia: Vodafone Hutchison Australia Pty Limited. Available
from: https://www.vodafone.com.au/red-wire/vodafone-tv-nbn-netflix[ Accessed 06 April 2020]
[53] Lotz,T.,Korzunowicz,K.,2019. Overcoming VoLTE: Deployment Challenges. In:Krüssel,P.,eds. Future Telco Successful Positioning of Network Operators in the
Digital Age.Cham, Switzerland:Springer Nature Switzerland AG, 143-151.
[54] Meffert , J., Mohr,N., 2017. Overwhelming OTT: Telcos’ growth strategy in a digital world[Online]. New York: McKinsey & Company.
[55] Melayu, B., 2013. Maxis Launches #Hotlink, The First Prepaid Plan In Malaysia That Keeps You Connected All The Time[Online]. Kuala Lumpur,Malaysia: Maxis
MEDIA RELEASE. Available from: Maxis Launches #Hotlink, The First Prepaid Plan In Malaysia That Keeps You Connected All The Time[ Accessed 01 April
2020]
[56] Minges,M. and Kelly,T.2019.Chapter 2,Supply:Data Connectivity and Capacity.In The World Bank Group ,eds.2018 Information and Communications for
Development Data-Driven Development.Washington,USA:International Bank for Reconstruction and Development-The World Bank,9-30.
[57] Monarat,J.,Hitoshi,M.,2019.Relationship of Over-the-top (OTT) Communications and Traditional Telecommunications Services: the Case of Thailand [Online].30th
European Conference of the International Telecommunications Society (ITS): "Towards a Connected and Automated Society", Helsinki, Finland, 16th-19th June
2019, International
Telecommunications Society (ITS), Helsinki.Hamburg:ZBW. Availabe from:https://www.econstor.eu/handle/10419/205184 [Accessed 07 April 2020].
[58] Montgomery,D., Peck,E.,Vining,G.,2012,Introduction to Linear Regression Analysis. 4th Edition.New Jersey:John welly&sons publications.

[59] Myriad Group AG, 2014. BRIEF-Myriad Group to offer msngr instant messaging service to Telefonica[Online]. USA: Reuters. Available from:
https://www.reuters.com/article/myriad-group-brief/brief-myriad-group-to-offer-msngr-instant-messaging-service-to-telefonica-
idUSFWN0U306K20141222[ Accessed 02 April 2020]
[60] Nexans, 2020. 5G WDM Outdoor active cabinet [Online].Available from: https://www.nexans-cryogenics.com/eservice/Germany-de_DE/navigatepub_148777_-
37163/5G_WDM_Outdoor_active_cabinet.html[ Accessed 01 April 2020]
[61] Nikolov, P.,2013. Writing Tips For Economics Research Papers.Harvard University[Online]. Available from:
https://www.people.fas.harvard.edu/~pnikolov/resources/writingtips.pdf [ Accessed 11 April 2020]
[62] Ofcom,2016.Communications Market Report 2016. Available from:https://www.ofcom.org.uk/__data/assets/pdf_file/0024/26826/cmr_uk_2016.pdf [Accessed 14

January 2020]
[63] Ouyang, Mantian H., Alexis H., Zhongyuan L., 2018. Mining Over Air: Wireless Communication Networks Analytics. Switzerland: Springer international publishing.
[64] O-RAN Alliance,2020. Leading the industry towards open, interoperable interfaces and RAN virtualization. Available from: https://www.o-ran.org/ [Accessed 15
April 2020]
[65] Ovum, 2018. Consumer OTT VoIP Outlook: 2013 to 2018 [2013]. Ovum [Online]. Available from: http://fortune.com/2014/06/23/telecom-companies-count-
386-billion-in-lost-revenue-toskype-whatsapp-others/[accessed 10 April 2020].
[66] Peterson, T., 2015. FACEBOOK VS. YOUTUBE: WHAT DOES YOUR VIDEO-AD BUY GET YOU?.Adage[Online]. Available from:
https://adage.com/article/digital/facebook-youtube-video-ad-buy/297010[ Accessed 29 Feb 2020]
[67] Pickard, A., 2007. Research methods in information. London: Facet.
[68] Rakuten.Today, 2020. Rakuten is building the world’s first end-to-end cloud-native mobile network: Tareq Amin[Online]. Japan: Rakuten, Inc.. Available from:
https://rakuten.today/tech-innovation/rakutens-upcoming-end-to-end-cloud-native-mobile-network.html[ Accessed 15 March 2020]
[69] Reith,L.,2019. Paradigm Shift! The Path to Brutal Automation. In:Krüssel,P.,eds. Future Telco Successful Positioning of Network Operators in the Digital Age.Cham,
Switzerland:Springer Nature Switzerland AG, 111-129.
[70] Robuck, M., 2020. Vodafone slashes costs of core network functions across Europe using VMware's telco cloud[Online]. : fiercetelecom. Available from:
https://www.fiercetelecom.com/telecom/vodafone-slashes-costs-core-network-functions-across-europe-using-vmware-s-telco-cloud[ Accessed 13 April 2020]
[71] Saghaeian , A., 2015. Mobile Voice and Messaging[Online]. USA: LinkedIn Corporation.
[72] Said, A., 2017. Economic Impact of OTTs[Online].ITU-T. Available from: https://www.itu.int/dms_pub/itu-t/opb/tut/T-TUT-ECOPO-2017-PDF-E.pdf
[Accessed 03 April 2020]
[73] Sandvine,2015. Sandvine[Online]. Available from: https://www.sandvine.com/hubfs/downloads/archive/2015-global-internet-phenomena-report-latin-america-and-
north-america.pdf[ Accessed 14 March 2020]
[74] Schmitz,M.,Stummer, C., Gerke,M.,2019. Smart Automation as Enabler of Digitalization? A Review of RPA/AI Potential and Barriers to Its Realization.
In:Krüssel,P.,eds. Future Telco Successful Positioning of Network Operators in the Digital Age.Cham, Switzerland:Springer Nature Switzerland AG, 349-358.
[75] Schneider, A., Hildebrandt, C., Arnold, R., 2016. All Communications Services Are Not Created Equal – Substitution of OTT Communications Services for ECS
from a Consumer Perspective.SSRN[Online]. Available from: https://papers.ssrn.com/sol3/papers.cfm?abstract_id=2756395[ Accessed 06 April 2020]
[76] Seber,G., Lee,A.,2003.Linear Regression Analysis.2nd edition. New Jersey:John welly&sons publications.
[77] Squawk on the Street with John Legere,2018. CNBC show [video,online]. Availabke from: https://www.youtube.com/watch?v=RicP_VsQ3ZM[Accessed 15
Febreuary 2020]
[78] Stork,C., Esselaar,S., 2016. OTT - threat or opportunity for African Telcos?, [Online ],Available from: https://www.researchgate.net/publication/301787996_OTT_-
threat_or_opportunity_for_African_Telcos [Accessed 14 March 2020]
[79] Sujata,J., Sohag,S., Tanu,D., Chintan,D., Shubham,P. and Sumit,G. ,2015. Impact of Over the Top (OTT) Services on Telecom Service Providers. Indian Journal of
Science and Technology, Vol 8(S4), 145–160.
[80] T-Mobile,2020. Unlimited video streaming with Binge On™[Online]. USA: T-Mobile USA, INC. Available from: https://www.t-mobile.com/offers/binge-on-
streaming-video[ Accessed 03 April 2020]
[81] Trask, J., 2018. Regulating Telecommunications and OTTs - Levelling up or levelling down sector-specific regulation? [Online]. Available from:
[https://helda.helsinki.fi/handle/10138/232850]. [Accessed 15 March 2020].
[82] Uranga,M., Iturriagagoitia,J., Barrutia,J.,2016. Dynamics of Big Internet Industry Groups and Future Trends.Swizerland.Springer International Publishing.
[83] Valipour,O. , Hosseini,M., 2017. Using Multi Criteria Decision Making for Selection the Telecom Operators` Strategy for OTT Services .Vol.16 No.4, 2017.12, 517-
523.
[84] Verma, D. C., & Verma, P. (2014). Techniques for surviving the mobile data explosion. Cham: Springer International Publishing.
[85] Whitwell,S., 2017. Neural technologies, OTT Opportunity or Threat, [Online], available from https://www.neuralt.com/34/732/ott-opportunity-or-threat, [Accessed
01 April 2020].
[86] WHO, 2020. WHO Health Alert brings COVID-19 facts to billions via WhatsApp[Online]. Geneva: WHO. Available from: https://www.who.int/news-
room/feature-stories/detail/who-health-alert-brings-covid-19-facts-to-billions-via-whatsapp[ Accessed 04 April 2020]
[87] Wisker, G., 2008. The postgraduate research handbook, 2nd edition, NewYork, USA.
[88] Worldometers, 2020. Current World Population[Online].Available from: https://www.worldometers.info/world-population/[ Accessed 15 March 2020]
GLOSSARY OF ACRONYMS
All the acronyms used in this dissertation are listed below for readers convenience
ARPU Average Revenue Per User

CS Circuit Switching
CAGR Compound Annual Growth Rate
GDP Gross Domestic Product
IMS IP Multimedia Subsystem
IOT Internet Of Things
IP Internet Packets
KPI Key Performance Indicator
LTE Long Term Evolution
MNO Mobile Network Operator
OTT Over The Top

PS Packet Switching
QoS Quality of Service
SMS Short Message Service
SWOT Strengths Weaknesses Opportunities Threats
UN United Nations
USA United States of America
VoIP Voice over Internet Protocol
VOLTE Voice Over LTE
3G 3rd Generation mobile network
4G 4th Generation mobile network
5G 5th Generation mobile network
ACKNOWLEDGMENT
I would like to thank all my supervisors specially who have given me guidance and constructive feedbacks
throughout this project and during all this master’s degree journy. Without their guidance and persistent help this
master’s degree and dissertation would not have been achievable. A special thanks to the influencers in
telecommunications industry who have inspired me to complete this research and kept me inquisitive to help
improving this industry.

The Impact of Over The Top Service Providers On TH

Uploaded by

Copyright:

Available Formats

The Impact of Over The Top Service Providers On TH

Uploaded by

Document Information

Original Title

Copyright

Available Formats

Share this document

Share or Embed Document

Sharing Options

Did you find this document useful?

Is this content inappropriate?

Copyright:

Available Formats

The Impact of Over The Top Service Providers On TH

Uploaded by

Copyright:

Available Formats

The impact of Over The Top service providers on

the Global Mobile Telecom Industry: A

I.II Problem statement

May 20, 2021: Preprint submitted to ArXiv Page 2 of 28

I.III Statement of purpose

May 20, 2021: Preprint submitted to ArXiv Page 3 of 28

I.IV Potential value of the research

May 20, 2021: Preprint submitted to ArXiv Page 4 of 28

May 20, 2021: Preprint submitted to ArXiv Page 5 of 28

III Literature review

III.I OTTs are threat or opportunity for MNOs

May 20, 2021: Preprint submitted to ArXiv Page 6 of 28

III.II Impact of OTT on MNOs

May 20, 2021: Preprint submitted to ArXiv Page 7 of 28

(LDC) Long distance calls

(SMS) Short message service

May 20, 2021: Preprint submitted to ArXiv Page 8 of 28

May 20, 2021: Preprint submitted to ArXiv Page 9 of 28

Category Telecom product OTT services

May 20, 2021: Preprint submitted to ArXiv Page 10 of 28

III.III MNOs strategies to overcome OTT impact

May 20, 2021: Preprint submitted to ArXiv Page 11 of 28

1. Seeking for regulatory support

Regulation Licensed MNOs OTT Providers

2. Blocking the OTT Services

May 20, 2021: Preprint submitted to ArXiv Page 12 of 28

3. Absorb the OTTs

4. Create own OTT or acquire them

May 20, 2021: Preprint submitted to ArXiv Page 13 of 28

May 20, 2021: Preprint submitted to ArXiv Page 14 of 28

Network Virtualization to reduce CAPEX

May 20, 2021: Preprint submitted to ArXiv Page 15 of 28

Automation to reduce OPEX

III.IVCombined researches proposals

Compete Accept Partner

As explored in the previous sections, several researches have

May 20, 2021: Preprint submitted to ArXiv Page 16 of 28

IV Data and analysis

IV.I Major telecom trends analysis in the era of OTTs

Total population Mobile users Penetration Total revenue ARPU

Figure 4. 2020`s mobile telecommunications industry dashboard (personal collection).

May 20, 2021: Preprint submitted to ArXiv Page 17 of 28

Mobile types` connections shown at Figure 5(amended from GSMA 2020b)

International conversational voice minutes traffic shown at Figure 6

May 20, 2021: Preprint submitted to ArXiv Page 18 of 28

May 20, 2021: Preprint submitted to ArXiv Page 19 of 28

Phase I – Successful Phase for MNOs

Actual Revenue derived from regression

Figure 12. Actual revenues vs predicted revenue

May 20, 2021: Preprint submitted to ArXiv Page 20 of 28

As phase I is the success reference for the other two phases,

function of (y=16.365x+878.78), but it shall be increasing

May 20, 2021: Preprint submitted to ArXiv Page 21 of 28

While the MNOs are registering this massive

Phase III – Opportunity to recover the

May 20, 2021: Preprint submitted to ArXiv Page 22 of 28

Group 1: The OTTs` apps and services which

May 20, 2021: Preprint submitted to ArXiv Page 23 of 28

Figure 18. OTTs impact on MNOs (personal collection)