Most important is the fact that the consumers is now in power and that was a big change that’s happened over the last few years and as we look at this new business model, your going to see that it’s the consumer in fact that is driving the business model.
Then the past networks were driven by voice. So the service providers such as AT&T or Verizon is going to pay by its network and then they sold services. But with the networks facing operation, they felt they told you what strategy you could buy and you bought those services and you are happy to pay for them. That is changed considerably in the new broadband business model.
I mean broadband business model is a much lower margin model, it is a leaner model and it is no longer network facing. It is in fact customer facing. It’s driven by the subscriber, so that triangle is being inverted, whereas the cost used to go into primarily implanting engineering and operations demonstration, those have now had to be reduced considerably and more of the cost reduced considerably and more of the cost is going into customer service and marketing, because it is being driven by a subscriber.
The subscriber is demanding the services and they are no longer just buying services, they are demanding services, in which they want to use Netflix, they want to download videos and they require the services and the service provider provides those services to them.Read the rest of this transcript for free on seekingalpha.com
Select the service that is right for you!COMPARE ALL SERVICES
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
- Real Money + Doug Kass Plus 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV