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Watching the digital fuel gauge

The launch of the Digital Fuel Monitor couldn’t come at a better time, since it lands some real, proper statistics into the debate about the current shape and likely future of European telecoms.

Decisions are being made at them moment but much of the noise claiming to illuminate the argument is simple assertion, such as: 'telcos are struggling with a scissors effect of rising bandwidth demand and lowering revenues' (they aren’t); or that 'Europe has fallen behind the US in telecoms' (it hasn’t). Just about any European traveller to the US could tell you that they’re shocked by the sky-high prices (both mobile and fixed broadband) and patchy coverage there, but horror stories brought back in the luggage don’t count. Independently compiled key metrics might.

Which is what Rewheel has set out to do with the Digital Fuel Monitor. First a word about perspective. The two lead Rewheel founders, Antonios Drossos and Pál Zarándy aren’t just guns for hire. They’re unashamedly passionate about the subject of mobile broadband and its potential . And they’re equally passionate about the proper competition required to power the sector forward.

Their view is that we are in the midst of a profound transformation. Old telco, with its vertically-integrated network-owning service provision, is on the way out. Struggling to replace it is the utility access provider, or challenger network, with the job of offering ever cheaper and more resilient digital access. As new challenger telcos disrupt the markets and business models of the incumbent players, out go the old metrics of ARPU, price and revenue per minute. In comes the ever-cheaper digital fuel to grow the market for the new army of Internet-based specialist service providers and users.

As this disruption takes place we’re seeing all sorts of timely skirmishes. The current furore in France over the correct number of mobile network to have is a case in point. (see related news, left).

But the Rewheel metrics show that what many in France regard as the ‘proper’ 3-way oligopoly in mobile networks categorically doesn’t produce the longed for high-octane digital fuel of low cost, simply-tariffed mobile broadband. Quite the opposite. The numbers tend to show that there a two distinct Europes.

In one corner is what Rewheel calls the ‘protected’ markets. EU states where the number of mobile players is limited, often to the ex-national wireline operator, one of the big pan-European mobile players, and one other making up the numbers to imply proper competition. Except it doesn’t.

These 3-network oligopolies invariably offer high prices and low innovation.

The other Europe - mostly the UK and the Noridic countries - usually have four mobile players and, as the Rewheel statistics show, offer a starkly different picture. High levels of competition and low prices.

View the digital fuel monitor here

Read the rationale and some of Rewheel’s conclusions here

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