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Mobile World Congress

Mobile industry is being hampered by “dumb” over-regulation, says Deutsche Telkom CEO Rene Obermann at Mobile World Congress


By Jessica Davies, News Editor

February 26, 2013 | 3 min read

The mobile industry is being held back by “dumb” and “stupid” over regulation which is taking vital money out of the industry, according to Telekom CEO Rene Obermann.

Speaking at Mobile World Congress in Barcelona today Obermann called for changes in the ways the mobile ecosystem is regulated, with operators hit with additional taxes, spectrum and roaming regulation that are stripping the industry of money needed for mobile investment.

“Ultimately these costs will end up impacting the consumer and it is just wrong and stupid,” he said.

“The challenge for telcos is to do more with less, and pressure on revenues and prices is severe – people expect more or less everything for free and it remains a fiercely competitive, fragmented market. Prices are being driven down and we will move further toward more flat and transparent tariffs for consumers, which is a good thing as people are happy to pay for things if they understand what they are paying for,” he said.

“The technology evolution is seeing shorter and shorter innovation cycles in network technologies and telcos must adapt to that and become smarter, ensuring our networks are integrated in a way that can give consumers a totally seamless experience without the worry of multiple prices – they should have one price to be always connected,” he said.

Obermann warned mobile operators must be aware of the rise of over-the-top (OTT) operators such as Whatsapp and Viber, which are driving competition in the mobile space and piggybacking off the investment from mobile operators.

“Free OTT operators are taking away revenues away and we need to deal with it – I’m not moaning we just must be aware. There is an unprecedented level of investment needed in this market and this OTT paradigm in which we invest and they take the profit is unsustainable. Networks can not make all the investment and other parties get a free ride,” he said.

Mobile operators and OTT providers should be given a “level playing field” when it comes to regulation, according to Obermann. “We must have less investment-killing regulation - not have one rule for OTT operators and another for us.”

However, he stressed that OTT operators are not providing a "conflict" but opening up more opportunities and that to safeguard a successful future operators must collaborate with third parties including OTT operators, and embrace innovation.

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