Media no market for telcos.
The Dutch national telco, KPN, has publicly announced that it doesn’t see itself as a player in the digital content market. It is very happy to link as many services as possible to its network but is no longer going to be involved in these services itself.
The telco has clearly also aimed its message at the media companies and content providers, asking them to be more open towards it, and to work with it for the distribution of their content. KPN used the word ‘open’ several times – it wants an open network approach. To quote: ‘We believe in an open world, and one of sharing’.
Isn’t it refreshing to hear that from a telco?
Obviously KPN will have a lot of hard work to do to convince the media and other content players that it can be trusted, because the track record of these telcos is dismal.
Nevertheless KPN has been dragged into the open world and now has agreements in place with its major competitors regarding access to fibre networks. The Dutch regulator, OPTA, took a very hard line on that issue and in April 2007 KPN finally gave in. Despite the hard battles that were fought over ‘open access’ it now seems that the company has accepted it can no longer operate as a vertically-integrated monopolist, and we at BuddeComm therefore conclude that KPN’s new approach towards openness and sharing is genuine.
So, will it be plain sailing from here? We don’t think so. It won’t be easy to completely transform such an entrenched culture.
It will be up to KPN to show how serious they are about sharing, and mobile services would be a good starting point. Are they prepared to offer content providers a significantly larger slice of the pie? It will also be interesting to see what they are going to do with the content acquisitions and partnerships they have in place. To be believable they will have to unwind them or structurally separate them from the telco business.
KPN is using its digital TV service, Digitenne, as an example. It simply delivers the connection for €6.95 a month and is not involved in the content side.
The company’s aim is to move further into value-added network services, and some time ago they acquired Gentronics for that purpose. This IT company is going to enable KPN to offer a range of innovative services over the next decade. Calling itself a ‘multi-access company’, KPN’s vision is to link as many devices as possible to its intelligent networks.
From a distribution point of view KPN sees itself as the deliverer of many services and hopes to streamline this through standardised (open) devices. Its Digitenne set-top box already allows for a range of other e-services to be delivered.
KPN is rapidly becoming a global trendsetter for future telecommunication players, and its business models will be scrutinised and, no doubt, copied.
One thing is certain – it is one of the few national telcos that is moving in the right direction.
Paul Budde
See also:
Netherlands – Key Statistics, Telecom Market & Regulatory Overviews;
Netherlands – Convergence – Triple Play & Digital TV;
Netherlands – Digital Media Developments;
