New year, new start, same old issues?

Luke Taylor
Author: Luke Taylor CCO & Deputy CEO
Date: 10th January 2017
Categories: Technology, Financial, Telecoms, Fraud protection, Optimus, Neural Technologies, Revenue Management

As we start yet another year, and slowly recover from the excesses over the festive period, preparing ourselves mentally and physically for the year ahead. Have we learnt anything from the previous year to put us in good stead for 2017?

Apart from some more grey hairs and a few pounds around the waist, are we any wiser to what is around the corner in regards to the telecoms industry and can we accurately predict what will occur in the next 12 months? Do the events of last year provide a basis for what may or may not happen this year within our industry?

‘The top changes for Telecoms in 2017’ and similar prediction articles for the approaching year are popular right now. The industry press state what will and will not occur, what consumers may or may not procure, and the fashionable new toys including AI butlers and driverless taxis. Yet, away from the consumer ads and behind the fancy innovations lie a workforce that puts in the hard labour to make these amazing technologies available to the Everyman – the Communications Service Provider (CSP). 

The reality is, Telecommunications, be they mobile services or high speed broadband are regarded today by the consumer as a basic right, like the more traditional utilities such as water and electricity. Yet telecommunications, as I have said before, is still an exciting industry to be involved in. Telecommunications is always looking for the next innovation. The growth in technology is fuelled by immense consumer demand as witnessed by the slick handsets, wearables and IOT services now available and the consumer baubles now being flouted at trade shows such as the CEM Consumer Electronics in Las Vegas. Such investment in technology is crucial to keep pace or differentiate CSP’s from their peers and to provide these alongside the services and quality demanded and expected from consumers and regulators alike.

In 2016 mobile data traffic in the UK increase by nearly 65%. Hand in hand with this is exponential growth in OTT activities bolstered by the success of Facebook, YouTube, Google (Maps, Play), Instagram, Amazon App, Snapchat, WhatsApp, Netflix, and many more of 2016’s most used apps. Unbelievably, despite this enormous growth in data traffic, revenue levels for CSPs are predicted to remain stagnant… that’s right, stagnant. All this sexy technology and advances in consumer electronics yet the CSP that makes these services available will not get an increase in revenue…

The industry is being challenged as the likes of Google, Facebook and others demonstrate their wares, and take editorial footprint in both leading publications and national press. The CSPs, the crucial component to the success of these companies, must continue to run and manage the legacy networks if they have any hope in coping with increasing traffic volumes vs minimal revenue gain.  

CSPs are looking to implement new technologies to compete and provide capabilities to support the myriad of such services and offerings that utilise and need this infrastructure with minimal revenue gain.  For CSP’s to break out of stagnation, the need for CSP’s to merge or acquire complimentary companies is now much more relevant. Maintaining adequate in-country competition will always remain, so CSP’s will likely need to look at cross industry mergers such as seen by AT&T, DirectTV and TimeWarner in North America last year.

Such mergers and acquisitions will become more common, as CSP’s continue to look at new lines of business to maintain profitability and show increasing share value.  Such acquisitions will only bring further complexity, diversity, conflict and misalignment within these expanded corporations. The result will be the imminent need to standardise and optimise, to ensure the CSP can extract revenue and profits as quickly as possible. Multi-vendor systems will need to be consolidated, networks and infrastructure revaluated to ensure such aspirations can be achieved. CSP’s will continue to expand, enhance and improve their network infrastructure, product offerings and customer interaction initiatives to survive amongst their peers. CSP’s will need to do all this within a competitive and stagnant market. Revenue Management will be crucial to ensure every cent is recognised and attributed to the bottom-line and determine corporate success or failure.

Profitability will have to be king in 2017.  The need to consolidate and simplify vendor portfolios, standardise processes and achieve a holistic view of the business is going to be crucial.  Collecting accurate, rich and timely data from disparate systems and integrating this same data with Operational and Business Support systems is crucial. It ensures that CSPs have the correct detailed data to allow them to undertake in-depth analysis to provide insight and intelligence that can be visualised by senior management, empowering them to make informed business decisions.  When done successfully, this is undertaken in a timely manner with minimal risk, minimal cost and minimal impact to the day-to-day business.

CSPs need to continue to focus on optimising costs to increase profitability in a stagnant market.  As a vendor I recognise we need to continue to offer flexible software toolsets to empower corporations to achieve their revenue management strategies.  And as a consumer I look forward to ordering my AI butler.