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European Telecoms Face Decreasing Margins: Report

IDC survey said lower margins are forcing telecoms to to "move up the value chain" and offer consumers bundles of fixed and mobile, data and voice services.

The European telecommunications landscape is undergoing a radical transformation as telecommunications carriers and service providers battle tooth and nail for customer attention, according to a new study from International Data Corporation.

In "The European Telecom Review," IDC notes that decreasing margins are forcing European telcos to "move up the value chain." Converged communications technologies, moreover, are allowing them to offer consumers bundles fixed and mobile, data and voice services.

"CEOs of telecommunications operators are shifting their attention from cutting costs to growing profitable revenues," IDC vice-president for European telecommunications and networking research Pim Bilderbeek said in a statement. "As a result, new business models are being launched and networking architectures and IT systems are changing rapidly to support new service delivery models."

IDC expects voice over broadband (VoBB) to figure prominently in these bundles for the near future. Indeed, the report notes that that VoBB use in Europe are poised to explode, with the number of connections rising more than 1000% in four years from 2 million connections in 2004, to 22 million in 2008.

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