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Can Intelligent Data Fuel Next-Generation Telco Revenues?

By: Antti Koskela

T-Mobile has a commercial touting the fact that the carrier doesn’t have annual contracts, complete with young people heroically punching at the camera. Virgin Mobile has an ad showing off the financial benefits of switching carriers – illustrated by confetti-shooting cannons. Meanwhile, WhatsApp is providing voice and texting capabilities for $1 a year.

While T-Mobile and Virgin Mobile’s ads are fun and lighthearted, they demonstrate that communications service providers (CSPs) are still focused on differentiating by price point rather than by customer experience. However, in a world where over-the-top (OTT) providers are practically giving away traditional telco services for free, price is no longer compelling enough for customers to think about staying loyal to carriers.

CSPs are clearly feeling the pinch. Research firm Ovum found that text-messaging apps cost telcos about $32.5 billion in texting fees in 2013, and that figure is projected to rise to $54 billion by 2016. Since the debut of its voice services, many of WhatsApp’s 465 million subscribers are likely to start using the app to talk on the phone. Remarkably, the company is adding new users at a rate of one million a day.

Voice and texting are no longer sustainable sources of revenue for the telecommunications industry. In fact, price point itself is becoming commoditized by the entrance of so many new players in the space. CSPs are already shifting the focus from voice and SMS to data, but more needs to be done—or telcos will only continue to compete for a slowly diminishing pool of customers. Churn is already a big problem – in India, for example, the telecommunications sector experiences a monthly churn rate of 2.1 percent. When price is the only differentiator, a marginal difference in cost is all it takes for the competition to win customers.

There’s no doubt that the majority of CSPs are aware of the problem. In a recent Vanson Bourne survey, commissioned by Comptel, 80 percent of telco CMOs and CIOs/CTOs said that customer experience should be a shared goal throughout their organizations. CSPs have to rethink how to differentiate their brands through the customer experience, not price. To rethink the customer experience, it’s imperative that they also rethink their support systems. With the right  OSS/BSS infrastructure, CSPs can turn Big Data into intelligent data – using valuable, insightful assets to enrich their technical and commercial operations and help build a memorable customer experience.

But how?

OSS/BSS: Migration into Integration

Traditionally, the line between OSS and BSS systems has been fairly distinct. The teams that managed each usually did so separately, with one dedicated to ensuring that networks ran smoothly and the other making sure that customer service was streamlined. But, as technology and networks have become more sophisticated, the line has blurred. Consequently, these disparate systems have to be consolidated and centralized.

Most telco executives know that. Vanson Bourne’s research showed that over half (58 percent) of CMOs and CIOs/CTOs believe that OSS/BSS modernization and consolidation is going to be key to rising above the competition. Two-thirds said that they were planning to incorporate cloud-based technology into their OSS/BSS this year, too.



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