The True Opportunity in Digitalization

Everything discussed to this point has been about maintaining market position, but what needs to happen in the business to actually grow and prosper in a digital world? Operators battle constantly against the label and position of being the “dumb-pipe provider,” but operators still hold a significant set of keys that nobody else has access to, including:

• Operators see all the data traveling across their network
• Operators own the network, which is the access point to every customer

These factors need to be kept in mind when determining and pursuing monetization strategies. Operators need to then define and disseminate their digital product strategy more in depth. While there is a wide range of digital offerings appearing on the market each day, the focus of this conversation isn’t which products to choose; instead it’s how to adequately, effectively, and profitably deliver those products to the customers. Operators need to take a hard, practical look into their digital adoption and distribution strategies and answer these specific questions:

1. How do you attract digital product providers? Do you have automated onboarding strategies? 
2. How well can you integrate external products into your library? How do you vet and measure partner performance?
3. Many of these new products are high-volume, low-cost items that are purchased in real time. Does your network support immediate fulfillment? 
4. Do you offer cloud-based customer portals for billing, content acquisition, and prepaid account management?
5. Are you prepared to manage cryptocurrency transactions with partners? For example, are your teams versed in and prepared for blockchain technology?
6. Are you prepared to manage cryptocurrency transactions and account management for your customers?
7. Do you offer cloud-based loyalty program incentives? Does your loyalty program offer the ability to extend to “shared” loyalty with other enterprises?
8. Are your internal data sciences in a position to monetize the data transiting your network, without breaching privacy regulations? Has your marketing team developed a “Data-as-a-Service” strategy?
9. And most importantly, from a purely IT perspective: Is your IT infrastructure integrated through a proven, robust, microservices or service-oriented architecture that facilitates and manages API-based integrations across all the new digital platforms (internal and external) that will be necessary to support? This capability should not be underestimated.

Unlike the previously discussed technology transformations, moves to SDN/NFV Networks, and support for the onslaught of IoT, a well-planned and properly implemented digital delivery strategy is the one domain which can result in significant revenue growth with a surprisingly low ongoing cost burden.

Operators will need to look beyond their legacy partner channels to also encourage and attract a new generation of Digital Entrepreneurs and their innovations. Onboarding, distribution, billing, and partner management within these relationships must be (mostly) automated, as the sheer numbers of partners and products will easily be in the tens of thousands. Imagine your partner support operations today, where one agent manages fifty partners. A new digital delivery strategy may require an increase in that ratio to five hundred partners for that same agent. In this new paradigm, however, most of these partners are designated as “micro partners” due to the significantly smaller billing they produce. But ultimately revenue generation remains key, and connecting customers to these products while also delivering a satisfactory experience will be crucial to success.

Looking Ahead

Operators all over the world are finding new revenue streams through forward-thinking digital delivery teams. Personal transportation booking, online music services, streaming sports and movie content, bill pay services, voucher management and redemption, cryptocurrency transactions, loyalty accruals and redemptions, fleet management, data analytics marketing, and a wide array of other opportunities are being implemented in ways that are attracting customers away from traditional purchasing channels. This places the operator directly in the purchasing stream, which can lead to gaining a larger share of wallet from customers and ultimately building a significant brand loyalty that is no longer strictly associated with being a “dumb pipe.”