Telcos vs. the new breed of digital communications challenger: who will come out fighting?

The mobile industry is a dynamic and ever-evolving sector that remains a central part of everyday life for much of the world’s population. According to findings from the GSMA, global mobile connections passed the 7 billion mark in April 2014, and soon there will be as many mobile connections as people on the planet.

Each and every person with a mobile device is now a significant part of the new mobile economy, one built on apps, social channels, location data and industry innovation.

This marks an incredibly exciting time for the customers who are able to embrace an evolved mobile experience. New technologies like WhatsApp, Facebook Chat, iMessage and Skype have all helped to create a far more superior messaging experience to the old fashioned text message for example.

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But they have done so at a severe cost to operators, by severely eating into their profit margins. Operators have been forced to quickly find ways of competing against new market entrants like this, all the while supporting increasing data demands and ensuring that a consistently high level of service quality is maintained.

Achieving this is of course no mean feat and it comes at a cost of billions of pounds in investment. AT&T for example expects its capital expenditure budget for its existing businesses to be in the $18 billion range next year alone.

This is far from an isolated figure, with the GSMA predicting that telecom service providers across the globe will invest a staggering $1.7 trillion in mobile network infrastructure during 2014-2020.

In this landscape of rising costs, mounting shareholder pressure, increased competition and growing uncertainty, one thing is crystal clear, it has never been more important for operators to begin considering alternate strategies to compete.

For precisely this reason, a number of industry leaders today are adopting telecommunications outsourcing or leveraging business process management (BPM) services as a winning strategy against these market odds.

Telecom companies have typically been very early adopters of this approach, often outsourcing call centre requirements for example, so that 24-hour customer service and technical support lines are kept open.

In the past, some companies have even gone as far as adopting a ‘total outsourcing’ strategy, working with external partners to provide network installation, maintenance and service, as well as its IT systems.

Strategies like this are a testament to the success that can be achieved if the correct business process model is used and strategic partnerships are continuing to be formed in the telecom space today in order to support a growing number of business functions, from maintaining and supporting mature product lines to co-developing sophisticated 3G node elements.

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External partners continue to stand well placed in supporting operators on the next part of their journey, whether that involves managing customer data better, offering a stronger customer experience or scaling back costs so that innovative new technologies can be launched.

Despite the challenges, there is no escaping the fact that operators continue to stand in a unique position when it comes to championing the new mobile economy. The network assets and customer insight that operators can have at their fingertips will be crucial in helping to develop new content and services needed to guarantee a richer mobile landscape for everyone.

In such a fast-paced and turbulent environment however, unlocking the true value of this may require alternate methods, so that business leaders can really focus on their core business strengths.

Sourced from Keshav R. Murugesh, Group CEO, WNS Global Services; Chairman NASSCOM BPM Council, India

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Ben Rossi

Ben was Vitesse Media's editorial director, leading content creation and editorial strategy across all Vitesse products, including its market-leading B2B and consumer magazines, websites, research and...

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