My Thoughts on Technology and Jamaica: OUR Telecom Provider Stats indicate JA$14 billion profit for Second Quarter of 2011AD - Telecom Providers Stacking up all Faces on the Argo Video Calling and VoIP on smartphones

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Thursday, October 18, 2012

OUR Telecom Provider Stats indicate JA$14 billion profit for Second Quarter of 2011AD - Telecom Providers Stacking up all Faces on the Argo Video Calling and VoIP on smartphones



Some interesting new statistics have come to light from the recently released OUR statistics for the April to June 2011AD period otherwise referred to as the Second Quarter of 2011AD as reported in “Internet income up 138% as ... Telecoms revenue hits $14b mark”, published Wednesday September 19, 2012, The Jamaica Gleaner.
JA$14 billion in profits with Prepaid Mobile, Postpaid Mobile, Internet (Wired and Wireless), SMS and Fixed Line Mobile and Landline all showing increases in profits and declines in Subscriber base, an indicating of increased usage traffic from fewer subscribers for these Services. And as you read on, it’s mostly driven by disparities in usage of Telecom Provider Services between Millennials (ages 18 to 28) and Generation X (ages 29 to 45).

The last time they came out I did a blog article entitled “OUR Records Voice Decline for the Fourth Quarter of 2010 - Postpaid, Data Services and Fixed Line Mobile and Landline Saturday Night Fever for Telecom Providers” and made the observation that Data Services, Postpaid and Fixed Line Mobile and Landline were the new rising stars for the Telecoms Sector.

That article was based on OUR statistics for the Fourth Quarter of 2010AD. These recently released stats have been Gal a Bubble, Konshens Style on my front burner, as I took the time to analyze them in detail. So far, the news is good for Data Services, Postpaid and Fixed Line Mobile and Landline, but Voice is in a freefall.

So straight to it lads! The OUR statistics parlay the increases or declines when the Second Quarter of 2011AD is compared to the corresponding Second Quarter of 2010AD:

Financial News

1.      13% increase in profits which translates to $14 billion
2.      Mobile Voice Services declined 2.3% to $8.79 billion
3.      Fixed-line revenues increased 36% to $3.5 billion when compared to the
4.      Internet Services, both wired and Warless increased 138% to $1.6 billion
5.      APRU remained unchanged at $2,647 per user

Prepaid and Postpaid

1.      3% decline in Prepaid subscriptions from the three million (3,000,000) subscribers in active usage
2.      4% decline in Prepaid customers subscriptions to 2.8 million (2,800,000) subscribers
3.      41% increase in Post-paid customers subscriptions to 146,000 subscribers
4.      32% increase in SMS (Short message Service) or Test messaging increased to $1.1 billion

International Calling

1.      1,328% increase in International call minutes  to 1.3 billion, the main reason for the fixed Line Revenue increase

Internet

1.      2.2%  decline in Internet subscribers to 117,800

Fixed Line

1.      7.6% decline in Fixed Line subscribers decreased to approximately 278,800

As was the case last time I did a statistical review, albeit basic, there's lots of missing Data, as it seems the Telecom Providers are less than forthcoming, to quote the OUR: “The submission of Internet-related Data trailed that for Mobile and fixed-line Services, and as such, information necessary for a thorough assessment for this section continues to be lacking”.

The above statistics confirms what I had long suspected; Telecom Providers are making more money from Prepaid Mobile, Postpaid Mobile, Internet (Wired and Wireless), SMS and Fixed Line Mobile and Landline despite declines in the number of active subscribers in these Sections of their Businesses. Jamaicans are becoming more active users of these Services, thanks mainly to increased promotions in that period that is usually the Start of Summer Time and loads of Partying, outings and arrangements for Travel abroad and requests for Remittances.

However, there has been an explanation at least, for the increase in Fixed Line usage; International Calling via International Calling Plans as described in my Geezam blog article entitled “How to set up an International Calling Plan for Digicel or LIME Prepaid and Postpaid”, quote: “International calls generated the most revenue during the review quarter. Notwithstanding what the usage (above) would suggest, it was incoming international calls, rather than outgoing, that contributed most to revenue uptake, with revenue from incoming international calls amounting to $1.6 billion”.

This fits with my idea that Fixed Line Mobile and Landline's increasing Call Revenues were based on an increase in the number of Jamaicans, Generation X (ages 29 to 45) beginning to settle into the second more comfortable phase of their lives and wanting hassle-free Mobile phone alternatives to constantly topping up a Prepaid phone.

Hence the reason why FLOW's Michelle English was up in arms about Telecom Provider LIME’s unfair Cross Network Termination Rates for their  Triple-Play Landline Network Service as noted in my blog article entitled Flow at odds with over Cross-Network rates for Fixed Line - Total Recall of the coming Importance of Triple Play Services”, as this was slowly becoming an increasingly important revenue stream for the Triple Play Provider as more Generation X (ages 29 to 45) become more settled.

The same logic also applies to Postpaid Subscriber increase and Prepaid Subscriber decline in the Second Quarter of 2011AD, as these statistics are before the drop in Mobile rates on Sunday July 15th 2012AD date as noted in my blog article entitled “LIME's new TALK EZ Plan drops Cross Network Calling to JA$2.99 - Digicel's Game of Thrones vs LIME Return of the King” and my Geezam blog article entitled “LIME drops Cross Network Calling Rate to JA$6.99 to kick off a 3 year Battle for Mobile Market Dominance.

Jamaicans, specifically Generation X (ages 29 to 45), want more comfort as they grow older and are willing to pay for Postpaid and Fixed Line Services and associated Triple Play Services. As such, they are chucking away their Prepaid Mobile phones back then in the Second Quarter of 2011AD, opting instead to have Postpaid Services and Fixed Line Mobile and Landline, which they appear to mainly use for International Calling.

The incredible increase in Internet usage is unexplained in the OUR’s Report, save that it must be mostly Mobile Internet Subscriptions such as Blackberry Mobile Phones, EDGE capable Feature phone and other smartphones that people smuggle into the island instead of buying stock Mobile phones from Telecom Providers.

Note that this was back then in the Second Quarter of 2011AD; CLARO 3G was all the rage, so people were getting hooked to from them on the idea of Mobile Broadband Internet. This trend shift towards smartphones or at least their predecessors was driven mostly by a more youthful set, the Millennials (ages 18 to 28). The time of CLARO’s reign in Jamaica, it seems, has propelled Mobile Wireless Broadband to the forefront to the point where we are now.

Those same Millennials (ages 18 to 28), now three (3) years on in 2012AD are  now opting for full blown smartphones as their second phone purchase as stated in my blog article entitledBlackberry popularity wanes as Jamaicans go smartphones - Android and Apple's Smartphone Revolution” and the Geezam blog article entitled “Apple iPhone boosts Jamaican smartphone usage as BB goes Chapter 11 Bankruptcy”. This after having gotten a taste of CLARO 3G and the competing Telecom Providers upgrading their Telecom Networks with faster Wireless Broadband to meet the coming demand.

Millennials (ages 18 to 28), the very same group with which I mostly interact on the SHARP Account, proud makers and suppliers of the 4” screens for the Apple iPhone 5 and possibly 5” screens for the Apple iPhone 6 as prognosticated in my blog article entitledSHARP and JDI making 5-inch 1080p Smartphone Screens - Here Comes the Boom as 1080p Screens, Quad-Core the next Big Thing for Apple iPhone

To this day, my fellow Millennial (ages 18 to 28) co-workers are most unrepentant with their blatant usage of BB’s on the Production floors of SHARP and Panasonic, despite user UE (User Equiptment) being Banned. Still, their target Market demographic is in the crosshairs of the Telecom Providers.  Millennials (ages 18 to 28) are the main group driving the transition to smartphones as surmised in my blog article entitledBlackberry popularity wanes as Jamaicans go smartphones - Android and Apple's Smartphone Revolution” and the Geezam blog article entitled “Apple iPhone boosts Jamaican smartphone usage as BB goes Chapter 11 Bankruptcy”.

Now with the rates down, I’m hoping that, despite the need to not give the competition a heads-up, the OUR could at least coerce the Telecom Providers to disclose results for the Quarters before Sunday July 15th 2012AD and the Quarters after in early 2013AD. This is for purely academic research as it would help to provide a basis for a comparison to see the true benefits of the lower Calling Rates to Telecom Providers GSM Voice Services, Customers and Subscribers.

This as I suspect that the Telecom Provider may be seeing significant revenue increases in Voice Services despite the decline in the On –Net and Cross Network rates due to a substantial increase in calling Volume. It would thus prove once and for all my hypothesis that decreasing the Cross Network Calling Rates increases Voice Traffic and thus revenues, with Telecom Providers merely having to upgrade their GSM Voice Network in terms of T1 Capacity and Cell Sites to handle the increased Traffic on the Voice Network.

Also required would be a breakdown of the Mobile Phone ownership i.e. Types of phones in usage as well as breakdown for the Internet Services, based on the various Services on offer in Jamaica, as I suspect Wireless or Mobile Internet is seeing an increase. Statistics on Mobile TV and IPTV Streaming Services would also be good, being as these devices are Telecoms Networks and albeit falling under the ambit of Broadcasting, the lines are beginning to blur, making the OUR reporting of such statistics necessary.

Already there are early signs that the Telecom Providers are anticipating this increase in Voice Traffic on their GSM (Global System Mobile) Voice Networks. Telecom Provider LIME has already declared that they are seeing this on their Network, with a 71% increase in revenues for the Second Quarter of 2012AD when compared to the Second Quarter of 2011AD as stated in my blog article entitledLIME reports Voice Traffic up 71% in Second Quarter of 2012AD - ACS-Xerox loses contract to TELUS International as LIME becomes Mavado Money Changer”.

Both Telecom Provider Digicel and Telecom Provider LIME are looking towards a future when GSM Voice Services will be extinct. Telecom Provider Digicel and Telecom Provider LIME in partnership with Avaya Communications are launching Avaya Aura with the intention to increase Mobile Broadband Internet usage on smartphones among SME (Small and Medium Enterprises).

The eventually aim is to make GSM Voice Services extinct by 2015AD as stated in my blog article entitledDigicel and Avaya Communications launch Avaya Aura for SME's - LIME and Digicel in a Step Up Revolution towards GSM Voice Extinction”.

Video Calling via Avaya Scopia for SME’s, another piece of tech recently acquired by Avaya Communications as reported in the article “Avaya's Scopia will save on trips”, published Friday, September 21, 2012 BY NEKIESHA REID Business reporter, The Jamaica Observer, will ironically gain more traction among the Millennials (ages 18 to 28) before the Generation X (ages 29 to 45) see the point of Video Calling. This as predicted in my blog article entitledSkype's Ads on Free VoIP heralds coming of Free Mobile VoIP - Video Calls not problem as LIME LTE soon tun up”.

I suspect this is mainly because most Generation X (ages 29 to 45) are Blackberry users, as opposed the younger Millennials (ages 18 to 28), who are driving the transition to smartphones such as the Samsung Galaxy SIII and the Apple iPhone 4S as surmised in my blog article entitledBlackberry popularity wanes as Jamaicans go smartphones - Android and Apple's Smartphone Revolution” and the Geezam blog article entitled “Apple iPhone boosts Jamaican smartphone usage as BB goes Chapter 11 Bankruptcy”.

Plus, many of the more settled Generation X (ages 29 to 45) like traveling abroad and albeit Senior Management in most companies,(aged 45 to 90) like to save money via Teleconferencing and Tele-Video Technologies, the Middle Management, mostly Generation X (ages 29 to 45), are non-too-crazy about losing the access to the jet set lifestyle of travelling abroad on their company’s tab. Hence the resistance!

So in summary, it appears that the increases in the Prepaid Mobile, Postpaid Mobile, Internet (Wired and Wireless), SMS and Fixed Line Mobile and Landline in the Second Quarter of 2011AD can be attributed to the shifting tastes of Millennials (ages 18 to 28) and Generation X (ages 29 to 45) as Telecom Providers are Stacking up All Faces – Mavado style. This as Wireless Mobile Broadband and Blacbkerry usage was becoming the new thing for the “In Crowd” among Millennials (ages 18 to 28) in the Second Quarter of 2011AD.


Meanwhile Generation X (ages 29 to 45) was getting hooked on Prepaid Services such as Postpaid Mobile and Fixed Line Mobile and Landline for International Calling to make the coming retirement more comfortable. All slowly becoming the new Argo (2012) for growth in an already saturated Prepaid Voice Telecoms Market powered by GSM Voice Services that’s already showing signs of slowly going extinct in 2012AD!
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