May 17, 2023

CSPs at the Crossroads: Should Telcos Drive Towards ‘More Connectivity Value’ or Accelerate Into ' New Value’?

What’s the best way to become a future-proofed telco? There are no easy or obvious answers, but plenty of opinions. At TM Forum's Digital Transformation World Asia event, Netcracker's Head of Strategy and Portfolio Marketing, Sue White, joined a panel offering insights into the topic.

At this year’s Digital Transformation World Asia, TM Forum's CEO Nik Willetts spelled out the choice available to telcos in a software-centric 5G era: 

“We must face the reality that we are at a crossroads. On the one hand, we can continue to be the providers of networks – the connective tissue on which the digital economy rests. But is this sustainable? Is this really harnessing the true value and brilliance of this industry?”

“There’s an alternate pathway, where we unlock significantly more value, co-creating with partners in growing platforms and ecosystems. This can really harness the true potential of our industry to solve many challenges and redefine our definitions of growth."

These are exciting – if nerve-wracking – times for telcos. More than 1,200 attendees, and over 150 CSPs, traveled to the event in Bangkok to discuss growth opportunities in the digital-first 5G era.

A session on Creating The Tech Roadmap For The Future Proofed Telco provided a detailed dissection of the topic. The speakers included:

  • Moderator: Joann O'Brien, VP Digital Ecosystems, TM Forum
  • Dr. Sharlene Thiagarajah, CEO, TM Research & Development
  • Ricky Chau, Chief Strategy Officer, CBC Tech
  • Kelvin Chua, Head of R&D, Circles.Life
  • Sue White, Head of Strategy and Portfolio Marketing, Netcracker 

Dr. Thiagarajah began by setting out the following fundamentals a telco must address before embarking on any new project:

  • Is this project for revenue uplift or operational efficiency?
  • What problem will it solve?
  • How can we deliver it at scale (including geographically)? 
  • How can we build it fast?
  • How can we build in digital support?
  • How can we make it cloud-first and secure?

These provide a good foundation. But what kind of new business projects should a telco consider? Sue White boiled it down to three strategies:  The first is to add more value with connectivity. For example in the enterprise market, this could be SD-WAN and SASE (Secure access service edge) delivered in a NaaS model, maybe adding more vertical applications on top of that.  It could be end-to-end services for private 5G.

The second option is leveraging connectivity where you are not the reseller, where you don't own the end customer partnership. This is a huge opportunity. For example, telcos have so much customer and service data. How can we package it better and enable others to use it (anonymized) in services and applications?

And then there's non-telco business – leveraging telco assets, but not directly related to connectivity itself. We are seeing different strategies emerge, but they all involve partnerships, and that's key.

These options necessitate a degree of risk-taking from CSPs that have been relatively risk-averse in the past. 

Kelvin Chua explained how Singaporean MVNO Circles.Life addresses the challenge: "On some projects we have a 'do it now' approach. We complete a project in two days and then expose it to a cohort of users to get feedback. For example, we did a Chat GPT-powered app in two days and got consumer feedback on the third day. You don't typically see this kind of agility from telcos."

In the enterprise and B2B space, more preparation is always a good idea. According to White, Netcracker helped a telco to develop a remarkable tech product in the SD-WAN and NaaS field. However, the telco encountered difficulties when it attempted to sell the product since it didn’t have a good understanding of its target audience. Eventually, the telco realized that it should have involved its marketing team from the start.

White’s experience highlights the importance of understanding the target audience and bringing marketing into the process early on: 

"This is a big learning for telcos. Whether it’s selling new products on top of existing connectivity or going into a completely new vertical, ask: what value do we bring? What's the competition doing? Where do we fit? But I feel that CSPs are getting better at solving these problems upfront and then figuring out the tech product (after)."

You can watch the entire TM Forum session here.





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