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MNOs come out fighting: the great industry come-back

Doing nothing is not an option

There’s a groundswell of chatter and opinion-sharing about the pressures swirling around the network; perfect storm formations of connected things, smarter devices, and 5th generation mobile networks. For a long time, we’ve been able to feel 5G in the air.

It would be a mistake to do nothing in the light of these trends. MNOs cannot take refuge in established mainstream subscriber services, and simply offer more competitive rates. Analysis Mason’s predictions for the telecoms, media and technology sectors 2017 features digital experience as the third big thing in its top ten predictions: “Network operators will increasingly use digital experience initiatives to appeal to digital natives.”

Fourth on the same list is a suggestion that “an increase in the volume of mobile video traffic will lead network operators to invest in virtualized video delivery and traffic management solutions.”

In a recent blog – Monetizing the network: operators’ new models – my colleague addressed the ‘dumb pipe’ syndrome. He suggested that only by meeting new subscriber demand for more sophisticated services could operators expect to retain and build business. Meeting this demand requires an honest reassessment of how fit the business is, in its current format, to accommodate new demands subscribers are making on their service providers.

It can be done. All is far from doom and gloom. Focus is important; leaving the past behind and turning the business on its axis. Everything is getting smart. Once upon a time it was just the mobile phone. Now connected cars are well on their way and wearables are gaining pace of adoption and consumer popularity. Deloitte’s 2017 Telecommunications Industry Outlook observes:

…”wearables such as smart watches and fitness bands have seen tremendous percentage growth. Smartwatch penetration doubled from 2014 to 2015 and tripled in 2016; smartwatches have now penetrated roughly 12 percent of the mobile consumer market in the US.”

Market dynamics

One is tempted to wonder which type of organization stands most to benefit from network-dependent new technologies, such as the Digital Assistant. Will disruptors continue to cannibalize the market? History suggests that they will, unless market dynamics change.

Past incursions such as Skype, WhatsApp, and Facebook have established an evolutionary pattern – the fittest are surviving and thriving. These OTT service providers are delivering exciting and relevant services that customers are finding to be more useful and engaging than traditional services. What’s more, they are delivering these services through the pipes built by the MNOs.

Look no further than this year’s CES, where Amazon’s Alexa stole the show and is already being incorporated in products from LG, Lenovo, GE and even Ford, the latter putting it into cars.

If these significant recent trends are anything to go by it is easy to imagine that these organizations, and others like them, are already planning their service propositions to meet IoT and its potentially limitless manifestations.

Claim your share

Here’s some advice that has stood the test of time ever since Fleetwood Mac released Rumours, back in 1977:

Don’t stop, thinking about tomorrow, Don’t stop, it’ll soon be here,

It’ll be, better than before, Yesterday’s gone, yesterday’s gone.

Tomorrow will only be better than before for MNOs if they take such advice and start obsessing about tomorrow. Any five-years out view, based on offering network services as they are today, is simply not realistic. ‘Better than before’ is not a right. It has to be claimed.

Here’s what KPMG had to say last year about tomorrow for the ‘traditional telco’:“(it) will struggle to survive beyond the next decade …unless it embraces the opportunity presented by digital.” [1]

A need to adapt is clearly emerging as a theme in just about every blog and pronouncement you read nowadays. Everybody agrees that the fittest will survive and I was delighted to note another observation from KPMG that largely concurred with my own long-held views:

“Their (Telcos’) first challenge must be to shift the prevailing business mind-set from one focused on engineering to one focused on the customer. There remains a legacy culture in some Telcos in which the customer is a secondary consideration to engineering.” [2]

The new battleground

My colleague talked about the need for agility in provisioning new services in a blog ‘MNOs might never be the same again’. Legacy network infrastructures, or – more to the point – the legacy style of thinking that goes with them, are highly suspect as foundations for competitive agility in the future. Customer focus will be the new battleground – requiring new thinking and a new, agile approach to network technologies that permit speed of response and dynamic services provision.

Video, picked out in Analysis Mason’s predictions, is but one area to prepare for. IoT will be soon upon us. MNOs need to be ready to meet the demands of the modern customer. Providing digital services and great customer experiences is necessary to win. The most important thing is to recognize the need for change now. It will all soon be here. A transition to software-driven architecture, providing the agility and flexibility that a changing world craves, can be made in such a way as to retain many of the robust and still valuable capabilities derived from existing investments.

How realistic is it to move swiftly to a customer-centric business mind-set? I’d welcome your views on the great MNO come-back, particularly with regards to the people skills you think are most likely to make it possible and how those skills can be deployed.

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