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The future of diversification in the mobile sector

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Reed Smith partner Askandar Samad looks at the vital role diversification will take in the mobile market in 2017, with the realisation that mobile operators can no longer be a ‘dumb pipe’

The old adage of “evolve or die” is not a concept lost on the telecoms sector. Diversification has become a key concept for both fixed and mobile operators, which have been deploying various strategies for some time, and includes acquisitions, partnerships and, to some extent, in-house developments.

Operators are anxious to avoid becoming commoditised channels over which younger and nimbler tech companies can offer services, and are moving into areas beyond their core competencies. These include mobile payments by mobile network operators (MNOs), cloud-based services and, notably, content services.

As the outcomes of the 2016 European Union referendum and US presidential election have shown, predicting possible outcomes is fraught with risk. However, the announcement of AT&T’s acquisition of Time Warner has prompted commentators to consider the wisdom and merits of diversification, and it is from this position we consider what 2017 could have in store for the sector.

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