GSMA WARNS INTERNET VALUE CHAIN GROWTH TO STALL UNLESS MARKET IMBALANCES ADDRESSED – PR Newswire UK

Searching for your content…
Phone
+44 (0)20 7454 5110 from 8 AM – 5:30 PM GMT
Contact Us
+44 (0)20 7454 5110
from 8 AM – 5:30 PM GMT
News provided by
16 May, 2022, 00:01 BST
Share this article
Double-Digit Internet Value Chain Growth at Risk if Infrastructure Investors Cannot Realise Meaningful Returns
LONDON, May 15, 2022 /PRNewswire/ — A new GSMA report warns market imbalances between network operators and online services providers may put global growth prospects at risk across multiple sectors of the internet-based economy. Policymakers, the report urges, must consider the interdependence of online services and other growth sectors on the underlying infrastructure investment.
The GSMA 2022 Internet Value Chain Report reveals factors including asymmetric regulation and restrictions, sector-specific taxes, and spectrum costs are squeezing the business models of infrastructure providers whilst allowing Big Tech to thrive.
Telco squeeze
The study finds that revenues across the internet value chain nearly doubled in five years, from $3.3 trillion in 2015 to $6.7 trillion in 2020. Much of this growth comes from online services; they saw a 19% increase in revenue per annum in 2020.
Yet the return on investment in infrastructure for network operators was far lower, between 6% and 11%. The report highlighted average sub-10% returns on capital as a concern due to pressure on telecom operators to keep investing CAPEX at rates of up to 20% of revenue. 
The GSMA’s Chairman José María Álvarez-Pallete said, "The internet connects 4.6 billion people and drives the global economy. It is transforming business models, unlocking new opportunities, and uplifting communities across the world. But as some sectors in the internet value chain thrive, the demands of investing in the infrastructure those sectors rely on for growth are squeezing network operators. We welcome the growing recognition of this issue by policymakers, and as the internet-based economy expands across all sectors over the next decade."
The report notes that counterproductive taxation on infrastructure, cumbersome regulatory requirements, and other value-eroding factors can reduce incentives for infrastructure investment. It encourages policymakers to consider the full landscape of taxation and regulation, ensuring that companies investing in infrastructure are incentivised to build and upgrade the networks that underpin online services.
Download the 2022 Internet Value Chain report.
About GSMA
The GSMA is a global organisation unifying the mobile ecosystem to discover, develop and deliver innovation foundational to positive business environments and societal change. Our vision is to unlock the full power of connectivity so that people, industry, and society thrive. Representing mobile operators and organisations across the mobile ecosystem and adjacent industries, the GSMA delivers for its members across three broad pillars: Connectivity for Good, Industry Services and Solutions, and Outreach. This activity includes advancing policy, tackling today’s biggest societal challenges, underpinning the technology and interoperability that make mobile work, and providing the world’s largest platform to convene the mobile ecosystem at the MWC and M360 series of events.
We invite you to find out more at gsma.com
Logo – https://mma.prnewswire.com/media/1385555/GSMA_Logo.jpg
GSMA Press Office pressoffice@gsma.com
SOURCE GSMA
More news releases in similar topics
+44 (0)20 7454 5110
from 8 AM – 5:30 PM GMT

source

Leave a Reply

Next Post

Suprise! The internet of things doesn’t necessarily include the internet - Network World

Thu Jun 2 , 2022
By Tom Nolle, Network World | Tom Nolle is president of CIMI Corporation, a strategic consulting firm in Voorhees, NJ. His projects have taken him all over the world, and into nearly every network technology.When the now-familiar concept of the Internet of Things (IoT) was new, what we really were […]
%d bloggers like this: