Why Can OTT Companies Move More Quickly And Efficiently Than Cellular Operators?

OTT companies take full advantage of their services and are investing large sums of money to innovate in developing new ways to take advantage of the improving capacity of telecommunications networks. On the other hand, cellular companies cannot invest funds as large as OTT companies because operators are required to always maintain and improve the ability of telecommunication network infrastructure first. This network investment is very expensive, it includes hardware, software, tax, and frequency fees which as a whole make up the cost structure of telecommunications infrastructure. Meanwhile, if you want to take advantage of ott advertising for your marketing strategy, you can try out advertising services.

Therefore, operators still feel disadvantaged in applying data service rates because the rates offered are still low. This is because the large investment costs for the network and the business model are still in the stage of educating the public (customers) on data services which are still relatively new. So that the current operator data service rates still do not cover investment costs and are still subsidized from voice and message service revenues.

To cover this data service revenue deficit, operators must be creative and innovative in finding new revenue sources. One of the models is interstitial ads, which are enforced when customers access various sites. Another model is the ability of service providers to collect demographic data, data usage behavior, and consumer activities in accessing information. Anonymous version of this information can be presented to certain OTT partners or corporate businesses as needed. This data company is used to get to know consumers and improve marketing strategies through marketing according to consumer behavior, personal marketing, specific location-based advertising, and others.

At a time when voice and messaging services are stagnant – likely to decline and data service growth is only compensating for major business losses, operators need to find new ways to grow. The operator’s desire is the need to apply the concept of profit/cost sharing to OTT actors with the consideration of the principle of justice. Another thing is that cellular operators need to realize the importance of working with OTT companies. Working with the right OTT company can improve services and create a business model that is faster, more cost-efficient, and less risky than if they did it all themselves.

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