COMPLIMENTARY ADVISORY REPORT

Will Demand for Housing or Video Determine the Fate of Fixed Broadband Access in 2009?

| December 31, 2008 | Broadband Infrastructure | Advisory Report

| Analyst: Yoav, Schreiber, Senior Analyst, Digital Media Infrastructure

Unlike previous recessions, including tech/telecom-centric recessions, the balance sheets of most telco operators around the globe are healthy today. Thus, a focus on reducing operating expenditures is not likely to be as great as improving revenue generating capabilities. True, sensible operators will always look to keep their expenditures in-line with their expected revenues in order to preserve profit margins.

Video is the most likely candidate to drive telco operator growth into the foreseeable future, and improving the availability of broadband access will be the most likely way in which operators, around the globe, can expand the proliferation of media rich applications and services that will grow average revenue per user (ARPU). Therefore, despite the overall decline in the housing market, telcos will selectively direct 2009 capex to improving access availability, arguably the largest continuing challenge to applications proliferation, which limits the capability of telco operators to deliver premium end-user services that will generate enhanced revenue. Read more...

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