Over the last few years partnering has been increasing in importance for telcos. Fed up with just generating revenues from connectivity and becoming marginalised by the OTTs, the telcos have been fighting back, and partnering is key. It started with bundling Spotify or Netflix subscriptions into a top end subscription plan. This was a good way (and still is) to get customers on more expensive and higher end data plans. But we’re now starting to see some very creative partnership offers, which offer an insight into where the market is going.
I think we’ll see a wide range of new partnerships and telcos dipping their toes into new areas. Orange Bank is a well-known success story of a telco becoming a mobile bank. Virtually all operators offer TV services as part of convergent offers and bundling of music streaming services is almost now ubiquitous. There are new partnership offers being rolled out by telcos – everything from smart homes and security to insurance, to partnerships with shops where people give people data credits instead of small change from a purchase. The point is that we’re starting to see a wave of new partnership opportunities. If someone can use their mobile to control, consume or interact with a service, then this means a partnership opportunity for the telco.
Then there’s 5G.
One of the first use cases of 5G in the US, is rolling out FWA (fixed wireless access) to homes without wired broadband. When launching Verizon 5G Home, it was announced that ‘this is a new way to watch TV’. Using content partnerships to get new subscribers is a proven tactic. Verizon have just announced a deal with Google to offer YouTubeTV free for 3 months for customers who sign up for Verizon 5G Home. Free content usually works. Free content plus 5G – should be popular.
SK Telecom launched 5G at the start of April. Looking through their offers, the main selling points were content based and being able to consume it in a more immersive manner. From UHD video to watching baseball in a virtual reality environment offered a richer viewing experience.
Within a month SK Telecom announced a number of deals to use its 5G network for applications across smart cities, autonomous vehicles and connected hospitals. This shows the potential in the smart buildings / cities that 5G can deliver. In many cases the telcos will be providing the 5G connectivity with the applications delivered by partners.
5G will accelerate the opportunities for telcos to increase revenues by selling partners’ products and services. It will also mean a wider range of partner offers which must have a much faster time to market. This expanded offer portfolio will provide the ability to experiment with new business models and will mean a fluid and dynamic value chain. For one market, the telco may be leading the offer, but in another, the telco may be the connectivity provider with a partner taking the lead.
One thing is for certain – if telcos are to step up and embrace the new opportunities that partnerships will deliver, then a new platform approach is needed. Telcos need to enable automated on-boarding, rapid monetisation and management of partners’ offers. The good news is that this is starting to happen.
Looking at the Catalyst projects at the TMF’s Digital Transformation World conference (14-16 May, Nice, France) one that jumped out was the Zero-touch Partner Integration proof of concept Catalyst. This looks at using Digital APIs to automate on-boarding of partners. This will make it much quicker for telcos to get digital service partners on-board and be able to sell their services.
There’s a good article on this Catalyst on the TMF website, which gives an insight into the driver for this work. “Our focus is around accelerating digital innovation,” says Neil Harrington, Senior Director, SaaS Incubation, Oracle. “But here’s the problem with digital innovation: The ideas flow, very fast, and there are so many ideas. But the ability to instantiate those ideas, test them out in the market and monetize them is 12 to 18 months. By that time, you have to question the relevancy of the idea.”
So, it’s good to see this level of innovation to automate the on-boarding of partners. But what also needs to be looked at, is the role of end to end Digital BSS in the process of partnering. Charging systems must be able to quickly be configured by the telco (no need for expensive and lengthy vendor intervention every time you need to build a new offer) so that time to market is measured in hours. Policy systems must be able to automatically and dynamically optimise the network (and individual slices) to ensure the right QoS and latency is delivered for each service. And systems must talk to one another – Digital APIs and interoperability must be built into Digital BSS. Telcos are seeing the benefits of partnering. Innovative vendors are also seeing that collaboration and openness work for the benefit of telcos and vendors alike.
Openet will be on stand 310 at Digital Transformation World. If you’re going to be at DTW and want to meet up click here to arrange a meeting.