Why the future journey of the CSP is a no brainer

Andrew Walker of Accenture

Every business, large or small, has one main goal, to grow. As the saying goes ‘if you’re standing still, you’re going backwards. While growth has been particularly difficult for most businesses in the pandemic, many have used the current circumstances to transform themselves, notably digitally, as they look to recover and come out of the situation stronger.

However, for some, the pandemic has glossed over deeper underlying issues. Communication Service Providers (CSPs) are a notable example of this, with their period of stalled growth only continuing, says says Andrew Walker, senior managing director and global communications & media industry lead at Accenture.

The reason why is ten-fold. Competition for B2B services is accelerating amongst tech giants, whilst ARPU deterioration and customer churn increases, and the cost of acquiring new customers continues to grow. It all adds to the mounting pressure CSPs face to maintain their stock prices and acquire significant capital investments – all necessary to deploy technologies such as 5G and edge to keep up with rising customer expectations.

Light at the end of the tunnel

While things may seem dour from a CSP perspective, there is light at the end of the tunnel. The economic environment resulting from Covid-19 has provided a foundation for a new era for telcos to drive forward if they leverage three key elements properly.

The first lies in customer trust, with CSPs trusted more than anyone other company. Six in 10 consumers in our survey revealing they trust their CSP over three times more than social media companies. This trust opens opportunities to access, manage and monetise consumer data.

The second lies in increased demand for new and broad digital services, both from businesses and from government, as both SMES and large enterprises reaped the value that digital transformation could bring. The third opportunity is manifested in the acceleration towards the 5G agenda, driven by the government to digitise the economy and social institutions.

CSPs are in a unique position to underpin all three elements, providing and maintaining the complex ecosystems that support these objectives, and implementing the necessary technologies such as 5G, edge computing and software defined networks. But taking that leap and repositioning themselves in the value chain requires a new business model one that provides continuous monetisation whilst being able to pivot and scale to market conditions and customer expectations at any moment.

New territory for B2B and B2C players

This will require CSPs to integrate further into both B2B and B2C environments than ever before. In the home environment, this means transforming home devices onto an overall ecosystem, with smart devices underpinned by analytics and data services that allow the CSP and service providers to create an entirely personalised consumer experience. If CSPs can successfully leverage identity management, service provisioning, data analytics and onboard 3rd part products, customer engagement will be increased, as will platform attractiveness to third parties. It unlocks a new B2B2C value chain that CSPs are uniquely positioned to deliver.

On the B2B front, CSPs could play a critical role in powering the industry internet and IoT at scale. By providing managed services, built on the edge, that offer IoT, security, analytics and key software functionalities to businesses, they evolve their offering far beyond pure-play connectivity. Instead they become orchestrators of industry connectivity and indispensable partners for organisations, whether they’re in the government, automotive, health or manufacturing industries.

The platform

To make these B2B and B2C solutions work, CSPs must have the right platform to lift off. Enter the Connected Brain. This isn’t a new product or piece of technology, but rather a change in approach to strategy, technology, and execution. This holistic approach is a cognitive AI-powered microservices platform underpinned by three aspects:

  • A culture of innovation: This is created through investments in product development, management, and data science skills. It frees up the ownership of data internally (the new currency for businesses) and helps create a new governance structure that links the new and core business models.
  • Creating fresh revenue: Through the Connected Brain, CSPs can tap into data previously used for control, such as demographics and billing relationships, and turn it into fresh revenue. Furthermore, using the ecosystem to partner with new companies opens access to a telco’s capabilities and reduces costs for research and development by offloading them to a third party.
  • Flexible and future-proof architecture: Through the data-driven microservices it is built on, the Connected Brain can manage and correlate the data through automation. This not only helps to increase revenue by fuelling new services, but future-proofs the existing architecture by constantly keeping it updated, while at the same time enhancing customer experience.

From CSP to telco-tech

In order to make the Connected Brain a true success, there must be a mindset shift towards becoming a Telco-tech. This must become the North Star for the business, embracing The Brain strategy to power all operations.

If embraced correctly, telcos will become more competitive and innovative, leading to a generation of new products and revenue streams. Furthermore, they’ll have the platform in place that enables them to scale and partner within their ecosystem – a key asset to warding off potential disruptors.

With the Connected Brain, CSPs have the potential to transform themselves for years to come and propel their future revenue and growth. Fail to act and CSPs could not only find themselves stagnating again but taken over completely by outside competitors looking to move into new territories.

The author is Andrew Walker, senior managing director and global communications & media industry lead at Accenture.

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