December 30, 2014

Partnering to Capture the Enterprise

Carriers will partner with third-parties to bring specific services to consumer, SMB, or enterprise markets.

When the communications industry discusses new business models, it tends to focus on the consumer. This is the case when it comes to relationships with Over the Top (OTT) players. The opportunities for operators in the B2B sector are not dissimilar. Instead of social communities and music apps, however, the partnerships involve productivity tools and leading edge, private cloud app functionality exposed through flexible APIs.

In recent months, we’ve seen major operators roll out next-gen video conferencing in conjunction with large equipment vendors while other operators are integrating cloud apps from one of the giants of the online world. Each offerings can target almost any size of business. Both examples also give operators an advantage; it makes it harder for stand-alone OTTs to deliver a winning value proposition to businesses without an operator standing behind them.

The US is not alone in witnessing such innovative partnerships. In Europe there are more and more examples of operators partnering with, for instance, Microsoft, to offer a range of business applications from the Cloud for a subscription. In an age where CAPEX is seen as something to be avoided, we will see more and more products and services offered on a subscription basis.

Winning the Middle Market

Partnerships such as these, both in the consumer and business space do not simply protect carriers from OTT incursions. Although none of the parties see the primary motivation of the partnerships as new sources of revenue – yet – all see them as the key to longer term viability. It is well known that bundling reduces churn, so a one-stop communications provider for business makes a lot of sense. For example, most small and medium sized businesses (SMBs) do not have IT expertise, nor should they need to. A communications provider who can double as IT provider, connectivity provider and support team will be placed well to take advantage of this lucrative customer segment.

Going Cross-Industry

Whatever the target market, whether consumer, SMB or enterprise, we will see partnerships between carriers and third-parties proliferate over the next few years to bring a more diversified set of services to specific markets. Furthermore, this model does not stop at the digital world. Almost every industry on earth is becoming increasingly digital and connected, making cross-industry partnerships commonplace. The partnership model will ensure that even if carriers do become “dumb pipes” – possibly as a result of net neutrality, - the pipe will be full of interesting and useful things. Carriers will have a clear and critical role in value chain and value propositions.

Photo by Peter Alfred Hess via Flickr


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