Why telecommunication companies need to adopt digital technologies, fast

Digital tech allows them to rival disruptive over-the-top players


The communications service provider (CSP) industry is experiencing significant challenges. Disruptive technologies have given way to an army of streaming service providers, such as Netflix, Amazon and Apple’s iTunes, as well as IoT smart home devices that sell directly to the customer, bypassing CSPs. Offering services that deliver simple and tailored experiences is now vital to remaining relevant and competitive.

The information and its analysis provided through technologies are the driving force behind these customer experiences and engagement models. This could be as simple as suggesting specific types or length of videos to a demographic based on viewing habits. However, despite accumulating a vast amount of information on viewing habits and preferences, billing history and demographics, some CSPs do not necessarily have the digital tools and expertise needed to make meaning from all the information and provide customers with personalized insights and services.

The road to digital transformation

CSPs rightly want to differentiate their customers’ experi­ences, but to achieve that objective, there is no doubt that they will need to increase their reliance on analytics to gain actionable insights and deploy products and new services quickly. This requires a digital transformation.

While every CSP is capable of this, they must first address any organizational agility and customer experience management issues that could get in the way. These are highlighted by a number of reports, including the EY Global Telecommunications Study, as areas where obstacles could arise during the digital transformation journey.

The good news is that CSPs will not have to tear down their existing infrastructure and start from scratch. They can create a digital-ready infrastructure architecture, built on a cloud network that sits on top and enhances existing business systems.

Here are some key considerations for CSPs looking to create an integrated digital telco ecosystem:

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1. Use customer experience management (CEM) to drive customer retention: CSPs should consider deploying an omnichannel strategy from the outset. They should also offer quad-play services such as over internet, television, wireless and telephone services, as well as build-your-own-contracts and self-service options facilitated by artificial intelligence.

2. Focus on organizational agility: the ability to connect networks and launch new services quickly in response to changing customer needs is key and will help battle the disruptive forces of over-the-top (OTT) players. Organizational agility also opens the possibility to offer complementary services and play with OTT providers as an integrated digital services platform.

3. Improve cost control and productivity: by examining and enhancing existing processes, such as restructuring to consolidate to one data center or one network operation center, CSPs can reduce inefficiencies and save on operational costs.

4. Upgrade and modernize networks: according to Cisco’s Visual Networking Index, over three-quarters (78%) of the world’s mobile data traffic will be video by 2021. To cope with this traffic, CSPs need to either invest in hardware or rely more heavily on cloud services. Software-defined networking (SDN) and network function virtualization (NFV) will enable a more flexible and automated network and cut unnecessary costs at the same time. SDN offers a centralized view of the network, enabling CSPs to orchestrate and automate network services, while NFV allows for faster services innovation. When used together, these tools will drive more rapid and more efficient deployment of new services.

5. Re-examine IT investments: by adding technologies such as machine learning and predictive analytics to the mix, CSPs can personalize their offers and add more context and human insight to their customer inter­actions.

Customer experience underpins true digital service providers

There is no point in creating a digital ecosystem that only works for the business and not the end customer. The final leg of a CSP’s digital transformation is the transition to a digital services provider (DSP). Leading DSPs, including many of today’s social platforms, are experts at engaging with customers in timely and relevant ways. CSPs must make this leap, but to date have not developed the capabilities to enable real-time, relevant customer engage­ments, such as upselling new services based on preferences.

Carefully managing the customer experience is at the heart of driving customer retention. CSPs do hold one critical advantage though – they have already amassed huge amounts of information. The key is to harness this treasure trove and then combine it with human or "thick" data. Doing this allows providers to look at customers as individual human beings with emotions, wants and preferences — and personalize not only their offerings but also the experiences they deliver to drive customer growth, satisfaction and retention.

Creating a new digital services delivery model, which businesses can continuously adapt and optimize, will be essential for providing personalized and timely customer experience. This will ensure that traditional CSPs are ready to take on the next big on-demand entertainment platform to appear on the scene.

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