Can CSPs play Google at its own game?
The prospect of Google’s Project Fi creates uncertainty about the future of the telecoms industry. While partnering with Google will be an obvious choice for CSPs, as described in my last post, there is also a chance for CSPs to step-up to the plate and compete. But how can they go about this?
If a Google Fi model is to be widely adopted, this will mean more traffic being diverted from the cellular network onto Wi-Fi connections. While in some ways the decrease in traffic and pressure on cell networks could be an advantage, it could also cannibalise revenues. Google’s model of partnering with Wi-Fi and mobile network providers could, however, be adopted by CSPs. By making strategic partnerships, or even mergers and acquisitions, CSPs can expand their offerings and create a new network based on mobile and Wi-Fi connectivity as a way to offer first class customer service. We are already starting to see signs of this with EE offering Wi-Fi connectivity on the move as part of its mobile offering. CSPs would also have an advantage over Google as their networks are device agnostic, while Project Fi customers are required to use a Nexus phone.
Another differentiator that Google Fi is offering is usage-based billing, meaning you only pay for what you use and get a credit back for any unused data towards next month’s bill. This could be very tempting for customers that are currently pushed into packages where they pay for a range of services that they don’t necessarily use to subsidise heavier users. Traditional operator billing models do not fit with today’s pick and mix customers. Consumers now expect a service that is right for them – they do not see themselves as the mass market, they are individuals. CSPs that recognise this and shift their business models to offer a more personalised service to customers could get ahead of the curve and pull in new business.
Underlying all of this change will be a range of new technologies that will enable transformation. SDN and NFV will be key, as mentioned in our previous post; but real-time operational intelligence will hold the key to enabling CSPs to change how they operate. For example, providing a service that allows users to seamlessly switch from Wi-Fi to cell according to where the best connections are, requires real-time analytics and automated routers that can intelligently direct the traffic. Revenue assurance, supported by real-time operational intelligence around how and when services are consumed, will allow more dynamic pricing structures and usage-based billing for customers.
The world is changing; this is a fact that CSPs have already started to recognise, as we can see with the uptake in SDN, NFV, and analytics. The next step will be using these technologies as a basis for transforming business processes and launching new services; considering the fact CSPs already have the infrastructure, customers, industry knowledge and technical capabilities, I believe we will see great strides in the coming years – personally I’m excited to see the new era being ushered in.
By Gabriele Di Piazza, Senior Vice President, Products & Marketing, Guavus