At MWC last week there seemed to be lots of VR headsets (there’s only so many ways to sell handsets) and too many cars on stands promising autonomous driving. Walking round the halls I was wondering if I was at a motor show or a consumer electronics event in 2021. There’s always that element in MWC that’s a bit La-La Land. Having the right balance between future vision and reality is key. From speaking with service providers at MWC the reality they have is very much tied to current business issues they have, while providing a workable foundation for future services. They’re not talking about selling a ton of VR headsets or providing the connectivity and services so your car can drive you home. They have bigger problems – like how to become more relevant to their customers and make more money from 4G.
Going back to MWC – what I didn’t see too much of was the use of the term ‘Digital Transformation’. And this is a good thing. Transformation suggests that we’ll all press pause for a few years and go straight to the world of VR and autonomous cars for all. This future may be realized. But digital transformation is a myth. Service providers aren’t going to be suddenly transformed into digital companies. It’s an ongoing process, a journey with no fixed destination. There will always be new opportunities and new technological advances that service providers need to embrace.
In the meantime, as was borne out by speaking with many service providers last week, there are more immediate challenges. Never mind 5G, service providers need to increase revenues and profits and start seeing a better return on their 4G investments. They need to roll out new digital services, evolve digital channels, and upgrade their systems and processes to grow their business. This digital journey needs to be undertaken with a view towards increasing immediate 4G revenue as well as providing the building blocks for future services.
Telecoms service providers have been slow off the mark to capture the value of digital services. Instead, OTT players like Google, Facebook, or Apple have captured much of this value. Meanwhile, service providers are locked into unsuitable technology and rigid organizational processes. These once made them successful (when their business was selling circuit switched voice calls) but now hold them back, keeping them rigid. The good news is that service providers are changing. They are upgrading their systems and processes to take advantage of the opportunities that new digital services and digital channels present. But the question is: are they doing it fast enough, and in a way that delivers quick wins and provides short term benefits as well as a longer term foundation for growth?
Service providers can’t afford to wait out a massive digital transformation project to get the agility they need. Likewise, they can’t afford the long lead time that their legacy systems demand. The competition is not going to stop innovating to wait until the service provider is ‘ready’ to compete. OTT players are competing now. They’re making moves like providing free Wi-Fi, scooping up consumer entertainment spend, and providing enterprise business solutions like video conferencing. Service providers need the systems, processes, and tools to compete today, not in 3 to 5 years’ time. They need a bridge. This means they need vendors who can provide agile solutions that leverage service providers’ existing legacy systems. And critically, they need automated networks. The best way to take on this challenge is to embark on a digital journey.
Meaning what? A digital journey is an evolution, not a revolution. It’s a smart way to transform technology and methods of doing business using continuous upgrades and lots of small ‘bite-size’ projects. By this approach, service providers prioritize what needs fixing and design a roadmap. The roadmap should include many small projects, with short implementation and go-live timescales.
These projects are built on three key foundations:
- The Right Technology: automated, flexible networks and agile software (real-time and automated)
- Smarter Engagement: deliver real-time, contextually aware offers to increase relevance
- DevOps Approach: fail-fast, learn fast development and organizational structure
There will always be a bit of La-La Land about MWC – as there is with any big trade show, but the clear message this year was that people weren’t talking about transformation. The industry has moved beyond that and is starting on their digital journey – with the first stop being getting a better return on their 4G investments.