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How Can Telcos Stay Relevant in the New Digital World?

How Can Telcos Stay Relevant in the New Digital World?
Bobby Napiltonia, Chief Revenue Officer

We have been hearing and anticipating it for quite some time now, but it has come true, telcos are a big dumb pipe now!  Although, a deeper analysis of how this happened would be useful and several whitepapers can be written to elaborate that descent, it is more exciting to project what the future holds for telcos and how they can become more relevant to their customers again.

Traditional Slow Cycle of Innovation Can Be Fast Tracked by Building Dynamic Eco System of Partners

Traditionally, telcos have been a network service provider (voice, data, SMS, USSD, etc.).  All of these are essential services that are tightly integrated with the network.  However, innovation in the network platform happens extremely slowly.  It could take up to 5 years before consumers can see the benefit from the innovation in the network.  The rest of the world does not operate at this slow pace.  As a result, most of the innovation in technology and business models is happening outside the network at a break neck speed.  As the consumers across the globe spend more and more time on the mobile, there is a burgeoning need for telcos to stay relevant at the edges of their platform – on the “mobile edge”, on one side, to the “network edge” on the other side.

The pace of innovation is extremely fast at the edges for various reasons that are beyond the control of telcos.  The only option left for telcos is to build an ecosystem of partners who can drive the acquisition and monetization of new revenue streams that are attached to these edges.

Geographical Barriers Can Be Transcended by Collaborating with Other Telcos & Partnering with Other Companies

Cloud has eliminated, to a large extent, the geographical barriers that used to protect in-country service providers from overseas competitors.  Service providers like Facebook, WhatsApp, and Amazon are global platforms that can serve their customers globally, over the top of telcos. Traditionally, telcos are a landlocked business and there is a heavy price to pay if someone wants to use the service that belongs to a different country or geography.   That worked then but ubiquitous connectivity and advancement in technology has leveled the playing field for OTT providers who filed in with compelling services where telcos had erected cost barriers.  Telcos must partner with other telcos and platform providers to expand their services beyond their geo footprint.

This can be done by linking Telco platforms and creating a marketplace of new digital services that can be consumed by the services providers and customers across a region or globally.

Mobile Is Now The Dominant Medium Of Usage For Customers, Especially In The Mobile First Markets

Customers are now spending more time on their phones than television.  In mobile first markets, mobile is the only way for them to be connected to the world and get their content, entertainment and services through it. These markets are driving the need to offer content, entertainment and financial services in different ways than the developed world.  With the introduction of 5G in those markets, we can expect a large surge of untapped need for these kinds of services across the globe. 

With the upcoming technology cycle of much higher wireless speeds, the barriers for opportunities will be lowered one more time.  In order to take advantage of this cycle, telcos should look to offer content, entertainment and gaming products and services to their customers much more dynamically than traditional bundles and give the customers the flexibility to subscribe and consume that content based on their personal needs.

Pseudo Digital Vs Truly Digital

Telcos are still setup in the legacy configuration and need to reorganize to become truly “digital”.  This requires bold vision, fresh attitude towards business, infusion of new skills, leveraging rapidly changing technology landscape and providers, as well as new ways of doing the business internally – from product concept to delivery; marketing to conversion; order to cash; and customer satisfaction to customer engagement.  Due to a fast-changing technology landscape and changing consumer expectations, it will get more difficult to acquire and retain the talent required to compete in this new world.

In order to become truly digital, telcos must examine every single business function and determine what is the future of this function in the new digital world from a customer expectation perspective – not from a telco-centric perspective.  For example, in the digital telco of the future, what should be the role of the call center of future and is it even needed in its current shape and form?  Similarly, what services should be performed in the retail outlets, if any?  How would eSIM technology impact the SIM distribution and dealer eco system?  Would voice service remain relevant in the future of digital telco?  If so, how?  The clarity of the vision on these types of provoking questions will determine among other things whether a telco is on its path to be truly digital or not.

Digitizing Telco Assets

Telcos are sitting on a treasure trove of assets but they are locked into silos of operations and are held close to chests by people who either have no idea how to monetize them or don’t have the tools and mechanisms of support in the organization to unlock those assets for monetization.  As a result, handset and OTT service providers are collaborating to create those assets or get access to those assets, albeit, sometimes in a kluge fashion, but telcos are unable to do that effectively.  Telcos are in a unique position to fill those gaps for the OTT providers – provided they take steps to collect and harness the relevant information and build partnerships to monetize those assets.

Telcos should put an active program together to digitize their assets across the board so they can be shared internally and externally with business partners in order to reap business benefits such as reduced cost of development, vendor independence, enhanced customer experience, faster time to market, unlocking of new revenue streams, extending the reach etc.  Here are some service categories that could be broken down further to serve digitization and monetization purposes:

  • Connectivity services
  • Product bundling services
  • Payment services
  • Customer intelligence services
  • Security services
  • “OSS services”
  • Smart devices services

Apigate – Born and Bred for Telcos

Apigate’s global hub platform, product portfolio, and ecosystem of partners give telcos all the tools and know how required to digitize and monetize their business and truly take advantage of the upcoming 5G technology wave and once again become relevant to their customers.

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