Monetizing telecom networks
Most offline communities or networks use physical products which have a finite cost related to their raw material, manufacturing costs for every unit that is produced. This limits the profit margin for these products and the company’s profits also vary depending on the variation in the input prices.
Unlike physical products, software products can be replicated at almost no cost to the original developer of the product. The main cost is related to the initial coding, testing and marketing of the product. Once a software product has a large user base, the customers are forced to pay for customisation or regular upgrades to the software. This is why some of the most profitable companies today are software companies like Microsoft, Google and Oracle.
Setting up telecom networks involves a lot of expenditure in both hardware and software by the telecom provider. A part of this cost could be recovered by building virtual communities which are accessible for free only to subscribers of the particular network. Users of other networks can access these services only by purchasing a prepaid card, but may instead prefer to become direct subscribers instead.