The telecommunications industry has been undergoing a significant transformation, with traditional telcos shifting from being focused on voice and data connectivity to becoming technology companies, or “techcos.” This evolution is driven by the higher margin revenue of digital services, maximizing the return on investment in 5G networks, and monetizing networks through embedding them into other company’s solutions. Techcos tend to be more highly valued by investors and stock markets than telcos due to the increased opportunities for growth.
This shift is not just about adopting new technologies; it represents a fundamental change in business models, operational strategies, and customer engagement approaches. Telcos are now focusing on delivering personalized digital experiences, cloud-based solutions, and innovative digital applications that go far beyond mere connectivity. They aim to become central players in the digital economy, enabling smart cities, digital healthcare, remote learning, and more through their networks and platforms.
Our extensive experience working with communications service providers making this transition shows that those doing so most successfully tend to focus on the following initiatives:
Improving the metrics that matter – taking a programmatic data-driven approach to improving key performance indicators such as average revenue per user (ARPU), customer lifetime value (CLV), customer satisfaction (CSAT), and NPS (net promoter score).
Telecom Data Fabric – as telecommunications companies transform into technology-centric organizations, the implementation of a data fabric architecture becomes crucial, bringing together all telecom data sources into a unified near real-time data repository with a business semantic layer that simplifies unlocking the value of data assets, making informed decisions, and driving data-driven transformation.
AI Solutions – layering machine learning and heuristics-driven solutions on top of the data fabric to more accurately micro-segment network and digital services subscribers based on their behaviors to drive personalized customer value management efforts.
Hybrid-Cloud – in conjunction with growing top-line revenue, control costs of ownership of data and analytics solutions through hybrid-cloud flexibility, allowing providers to leverage their existing investments in on-premise resources while migrating to the cloud in a measured and purposeful manner. Telcos transitioning into tech-centric organizations strategically embrace cloud platforms like Microsoft Azure, Google Cloud, and AWS to optimize costs and scale services elastically, utilizing flexible pricing models and tools for efficient data management and financial oversight.
Data Governance – in the transition of telcos to techcos, effective data governance becomes essential for managing vast data volumes and ensuring regulatory compliance and data privacy, involving clear policies, advanced security, and regular audits. Beyond compliance, robust data governance builds customer trust by embedding privacy into operations and demonstrating a commitment to ethical data practices, which is crucial for delivering personalized digital services.
As we navigate through the dynamic landscape of 2024, the telecommunications industry stands at a critical juncture, transitioning from traditional telcos to forward-thinking techcos. This transformation is underpinned by several key trends shaping the sector’s future: the strategic implementation of Telecom Data Fabrics, the emphasis on Data Governance, the innovative application of Artificial Intelligence (AI), and the cost optimization of hybrid-cloud. Each of these elements plays a crucial role in enabling telecommunications companies to adapt to the technology provider era, offering them the tools to manage data more efficiently, ensure regulatory compliance and customer trust, and leverage AI to improve the key metrics that matter for their businesses.
Looking forward, the continuous evolution of the telecommunications industry promises even more innovation and disruption. The integration of emerging technologies such as 5G, the Internet of Things (IoT), and edge computing will further redefine what is possible, opening up new avenues for growth and transformation. As we stand on the brink of this new era, the journey of telcos from traditional service providers to tech-driven powerhouses is a testament to the industry’s resilience and capacity for reinvention. The future of telecommunications is not just about connectivity; it is about pioneering the digital frontier, creating unprecedented opportunities for innovation, engagement, and growth. By embracing these trends, telcos can unlock new revenue streams, deepen customer relationships, and position themselves at the heart of the digital economy.
To support telcos in their transformation journey, LigaData offers a suite of telecom data and analytics products and services designed to address the unique challenges of the telecom sector. The latest LigaData Telecom Data Fabric 4.0 release and LigaData Telecom AI Apps are purpose-designed for rapidly implementing robust telecom data fabric architectures, optimizing cloud investments, and leveraging AI to drive key subscriber metrics. Our products are tailored to empower telcos in navigating the complexities of digital transformation.
by Ian Fyfe and Marla Montoya