According to Deloitte, recent debate about telecommunication operators charging internet companies to distribute their content over the Internet should not come as a surprise.

Jolyon Barker, head of technology, media and telecommunications at Deloitte comments:
“Convergence across the technology, media and telecoms sectors brings with it the threat that operators, particularly fixed operators, will struggle to get their full share of convergence revenues. Connectivity, particularly broadband, is forming the basis for a growing number of converged services. Emerging applications, such as VoIP and video security systems, as well as maturing applications such as e-commerce and online music, are likely to continue to rely on broadband connectivity.

“Yet unlike other companies, at the moment broadband providers do not accrue additional revenues as these services are used. Record companies are paid for every legal song download; e-commerce companies generate revenues from every transaction; security companies charge a service fee for broadband-based video monitoring systems; media companies generate fees with every web search.

“Unless operators establish a means of generating greater revenues from the broadband services they provide, it is possible that telecommunications companies will be convergence losers: playing a fundamental role in the delivery of convergent services, and investing tens of billions of dollars implementing next generation networks that will be the bedrock for additional convergent services; yet arguably not extracting their due toll. News that they're considering charging fees on internet companies shows that operators are seeking out new ways to generate value from their investment in next generation networks.”

Ends

Notes to editors

About Deloitte
In this press release references to Deloitte are references to Deloitte & Touche LLP which is among the country’s leading professional services firms, providing audit, tax, consulting and corporate finance services. Known as an employer of choice for innovative human resources programmes, it is dedicated to helping its clients and people excel. Deloitte & Touche LLP is the United Kingdom member firm of Deloitte Touche Tohmatsu (‘DTT’), a Swiss Verein whose member firms are separate and independent legal entities.  Neither DTT nor any of its member firms has any liability for each other’s omissions.  Services are provided by member firms or their subsidiaries and not by DTT.  Deloitte & Touche LLP is authorised and regulated by the Financial Services Authority.  The information contained in this press release is correct at the time of going to press. 

Deloitte & Touche LLP is authorised and regulated by the Financial Services Authority.

The information contained in this press release is correct at the time of going to press.