Over the last five years, Communication Service Providers are acting as though they are Digital Service Providers, running into direct competition with traditional cable services. Few organizations have recognized this shift or that maturity varies with geopolitical boundaries amongst these players.
Few forward looking statistical data points for Telecom:
- More than 60% of leading telecom providers think customer experience is their top priority
- Revenue from voice and text could drop dramatically over the next five years
- IDC and eMarketer research projects upwards of 25% growth via Internet of Things (IoT) and targeted advertising
- Revenue share of OTTs and retail distributors could eat into operator revenue (in terms of share of wallet)
- More than 60% of leading telecom providers see growth via expanding geographies or providing services in related markets (like TV or banking)
Usage trends forcing transformation in the Telecom space are:
- Demography of users and device preferences
- Economic ability (disposable income and status) and duration of device ownership
- Density of Population, Bandwidth and Range
- Mixed content (text, voice, video) usage
- Multiplier and combinatorial factors from Society of Things (SoT)
- Variants of Sell-to and Sell-through business models
- Conflicts and lack of clarity around Privacy, Security and Compliance
- Share of wallet
At most telecom operations, we have seen a clear divide between the level of digitization enabled by their services and adoption of digitization for their internal operations. Existing architectures stifle the ability to realize the potential benefits of digitizing internal operations. Even the operators who embraced digitization strategies earlier this decade have encountered a rough journey so far, but those efforts are paying off for them. Fractures arising from customer engagement are immediately correlated to lack of reliable communication services. It is interesting that users who accept incremental features from their mobile apps are picky about feature delivery from their telecom providers. In order to achieve a level of maturity and acceptable rollouts, significant capital investment is required.
Starting with support for VoIP over LTE / WiFi, there is apparent need for tight integration between Operations Support Systems (OSS) and Billing Support Systems (BSS). These bandwidth intensive services also demand capital investments to develop and deploy new systems like 5G. This puts further pressure on operating costs and leaves the telecom providers to pursue capital intensive transformations or find options to isolate customer engagement from internal improvements.
Over 50% of the world population has smartphones; developed nations in North America, Europe and Asia having more than 75% penetration. The year-over-year growth rate of unique subscribers in 2014 is down to lower single digits in these regions, whereas Sub-Saharan Africa, parts of Asia and South America grew in double digits. Add to this, annual growth of world population is also down to about 1.4%, but machine-to-machine (M2M) growth is over 200%. The squeeze on investment priorities is amplified by the fact that there may not be sufficient unique subscribers to acquire – leaving the telecom providers to consider growth via M&A or partnerships.
Whether you are a network service provider or a handset / device manufacturer or both, focused pursuit of digital strategy to build an ecosystem is key to sustainability. We at Conexiam understand the market pressure, need to form partnerships with M2M service providers, System Integrators, SaaS and OTT providers and the impact that current architecture puts on transformation. Our custom method quickly identifies strategic priorities to optimize the portfolio of initiatives balancing the varying pace of transformation for Telecom providers.
Our Predictable EA approach develops a clear mapping from objectives to delivery, considering competitive landscape, internal processes and maturity, and partnership needs. We help set up the right internal architecture for the telecom providers to be fluid, stay at the same pace of digitization externally and internally and open up options for new revenue models. We have helped major US and Canadian telecom operators attain agility to increase their market share while improving internal operations. Our governance model aligns the organization on key priorities that assures returns and flexibility on capital investments.
Our team is experienced in TM Forum, itSMF, TOGAF® and IT4ITTM frameworks. We use these frameworks as a foundation to accelerate transformation efforts. We have successfully delivered initiatives to virtualize data centers, launch customer experience driven growth platforms and digital ecosystem management projects.