Telcos seek to redefine role as digital competition intensifies

Telecommunications is fast becoming a dirty word for companies that want to become much more than providers of basic connections in a digital world in which technology is undermining traditional revenues. Companies in the sector are still at risk of being left behind or being pushed to the margins as simple providers of the pipework that technology groups use to make their fortunes. And even the latter holds dangers if the telecoms groups cannot keep up with ever increasing demands from customers for instant videos and entertainment by investing heavily in next generation networks capable of carrying vast quantities of data.

The signs are that most groups are rising to the challenge, helped in regions such as Europe by regulators encouraging industrial growth through consolidation. This, alongside better economic conditions, is leading to higher profits and rising share prices. Now companies have the breathing space to invest in their future -- and various strategies are emerging among managements keen not to be left behind. At the heart of most strategies remains the desire to become the gatekeeper of the Internet -- and with it, the provider of services and content such as TV and music.