YOU ARE AT:OpinionReader Forum: Mobile operators – are they preparing for the digital battle?

Reader Forum: Mobile operators – are they preparing for the digital battle?

The number of traditional “pure-play” mobile operators is in decline as global consolidation continues at pace. Despite declining operator numbers, competition has never been so fierce – it’s just coming from non-traditional players in the market. The battle between operators and over-the-top players is never ending, and Wi-Fi-first mobile virtual network operators and free Wi-Fi services are becoming more established. Operators are already coming to terms with commoditized voice and text-messaging services as voice over IP and OTT messaging have cannibalized revenues. Mobile data looks certain to follow unless operators act decisively to prevent it.

To do so, mobile operators need to diversify their data service offerings in any way they can. One potential way to do this is by building innovative new partnerships outside of the traditional domain of the mobile operator. In particular, new partnerships with digital service providers such as Netflix and Deezer, travel insurance and home security providers offer lucrative opportunities operators shouldn’t ignore. So what’s holding them back?

Preparing for the digital battle

Openet recently surveyed 101 mobile operators to understand their readiness for migration to digital services. The results revealed an initial degree of optimism in spite of huge competition from VoIP and messaging OTT providers like Google, Skype and Facebook. In fact, 57% of operators think they are well prepared for the battle, citing their key area of competitive advantage as the strength of their network. Operators also believe a core differentiator lies in the customer trust they enjoy, alongside the fact they have a large customer base with an ongoing billing relationship delivering strong, sustained revenues.

Furthermore, operators are also clear about the opportunities that lie within digital services and which services will generate the most potential revenues in the future. Most operators surveyed believe their most lucrative new revenue sources in 2016 will come from providing multiplay offers, closely followed by selling digital life services (e.g. home automation and security services) to their existing customer base.

Understanding your customer

Being prepared for the fight is one thing, but unfortunately there is a big difference between knowing which customers will deliver additional revenues, and possessing the agility to physically target these users and monetize these services.

Operators remain hindered by technical frustrations and let down by the inflexibility of their existing systems. To reap the rewards, operators need to embrace the latest innovations in virtualized business support systems solutions. These will enable them to segment customers appropriately and deliver relevant, targeted offers in real time. And with respondents citing a lack of BSS agility as their biggest barrier, it’s clear that the clock is ticking for operators to change how they do business.

Breaking down BSS barriers

At present, the accepted timescale for building and launching a new offer (e.g. a new bundle, a new price plan, etc.) is several months. Many operators believe this is simply too long a wait, and the time taken to create and distribute offers should be measured in days instead. This is a huge priority for operators, with 37% of our survey respondents citing their biggest challenge of 2016 as the need to reduce product lifecycles and get more products and services to market in a shorter time period. This includes beating the OTTs who continue to erode their revenues.

According to the operators we spoke to, the biggest difficulties in moving to digital, from a BSS perspective, are large billing transformation projects taking too long, as well as the problems of trying to adapt legacy systems to cater for digital services. These difficulties were highlighted ahead of operating expense and capital expense reduction and the ever present IT problem of too many projects competing for too few resources.

Real-time personalization

People expect to be able to use the Internet – including recommendations, downloads and the activation of new products – in real time. And operators are well aware of this expectancy. Our survey showed more than half of respondents have tried using real-time data to help target offers to customers, but now want to go even further in their use of real-time data. This includes using it for better product development by identifying and determining usage and customer behavior, closely followed by proactive customer care.

Long road ahead

It is clear from our survey that while operators want to target customers with personalized, relevant offers in real time to drive upsell opportunities, they are being let down by the inflexibility of existing BSS. In fact, the majority of those surveyed (70%) recognize that when it comes to providing personalized customer engagement they are either worse – or much worse – than OTTs in this area. This would seem contradictory to the earlier viewpoint that operators are well prepared for the OTT fight.

But operators recognize they have a tough battle ahead of them. They are aware of their shortcomings and know what needs to be done to tackle them – sell more services, have a faster time to market, drive better customer engagement and be more innovative. The challenge that remains is the battle against the ticking clock of data commodization.

Editor’s Note: In an attempt to broaden our interaction with our readers we have created this Reader Forum for those with something meaningful to say to the wireless industry. We want to keep this as open as possible, but we maintain some editorial control to keep it free of commercials or attacks. Please send along submissions for this section to our editors at: [email protected].

ABOUT AUTHOR

Reader Forum
Reader Forumhttps://www.rcrwireless.com
Submit Reader Forum articles to [email protected]. Articles submitted to RCR Wireless News become property of RCR Wireless News and will be subject to editorial review and copy edit. Posting of submitted Reader Forum articles shall be at RCR Wireless News sole discretion.