Ahead of MEF Connects Wholesale next week, Suzy Menneret, Independent Strategy and Business Development Advisor, assesses the impact of Covid-19 and the resultant lockdowns across different markets on the global wholesale landscape, finding that there have been some positive effects that may present opportunities for the industry.

As H1 2020 data on the international wholesale industry trends starts to become visible, we are gaining a deeper understanding of the impact of the current pandemic on the traditional wholesale voice and mobile business. Globally, the lockdown has had a positive impact on international voice traffic volumes – typically a 20% increase in March year-on-year according to the combined traffic data log registered by some of the key players in the industry.

On the other hand, unfortunately, travel restrictions have harmed signaling and roaming traffic and revenues. The EU regulatory landscape was already a challenge for international carriers. The inability to monetize traffic to non-EU destinations has probably affected a few carriers’ top line.

While one can imagine that the peak in voice volumes has not translated into growth in revenues, many international wholesale players see messaging (A2P and RCS) and new IoT related services as growth drivers that may, or will, compensate the decline of traditional services, at least partially. With a growing base of 5.1 billion business messaging users in September 2020 (Mobilesquared), the messaging potential is clearly there.

The 2020 development – while certainly still posing certain threats – could also be seen as an opportunity to rethink the way business is being done to become far more flexible, engaging and quicker to react in a world that is more unpredictable than ever.

A2P has been and still is a great opportunity for the international mobile wholesale industry. RCS still has to show its promise, not so much on the overall value proposition, but on the viability of a sustainable business model for the international wholesale industry.

With Google already deploying its hub, and mobile operators focusing on national deployments, the success of an international wholesale hub depends on its ability to react quickly and mobilize forces as an industry.

All in all, the international wholesale industry went through major changes prior to the outbreak of Covid, with traditional services strongly commoditized in a hyper-competitive environment – and new business opportunities and efficiency models offering some reasonable compensation.

The 2020 development – while certainly still posing certain threats – could also be seen as an opportunity to rethink the way business is being done to become far more flexible, engaging and quicker to react in a world that is more unpredictable than ever. It is an opportunity to change, to transform further.

In the wholesale business, we often say ‘wholesale follows retail’. If we look at the retail consumer and enterprise business in Europe since the beginning of the year, many markets have seen their numbers being challenged by the situation we all went through – and are still going through – on a macro level.

Consumer business slowed down due to lower service and roaming revenues; lower prepaid revenues and fewer commercial activities were made in the B2C area; delays were experienced in corporate projects, and lower segment specific IoT activities – e.g. the automotive segment – were registered. One geographical market has nevertheless showed some strong signs of resilience: Germany.

If wholesale really does follow retail, then what is the impact of these trends on the European voice, mobile and IoT business carriers?

If you would like to know more about market trends or exchange views on industry development, transformation opportunities and challenges brought by our current market conditions in Europe and globally, come and join us on October 7 and 8!

Suzy Menneret

Consultant in Strategy and Business Transformation

MEF Connects Wholesale – 7th – 8th October

MEF Connects Wholesale takes an ecosystem perspective to explore the business trends and challenges driving connectivity today and asks what will create tomorrow’s business?

Across 2-days online, we’ll look at wholesale trends across Voice, IoT, Messaging & RCS.

Hear from analysts & experts, connect with your peers to discuss what are the new rules, new channels and new partnerships that will accelerate the future of wholesale.

Register now

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