One of the most persistent buzzwords infesting today’s telecoms industry is digital transformation, but what’s it all about at the end of the day?
This was the question Heavy Reading Analyst James Crawshaw sought to tackle in his presentation at the 2020 Vision Executive Summit event in Prague. He noted that digital transformation means different things to different companies but for all of them it’s about adapting to the internet era.
To illustrate what is driving digital transformation for CSPs Crawshaw drew on the biblical Seven Deadly Sins and gave them a telco transformation of their own
- Gluttony is applied to the voracious demand for bandwidth that creates much of the pressure to transform
- Pride refers to the complacency that has seen the business of connectivity become increasingly commoditized while CSPs have been slow to adapt
- Sloth is manifested in the stagnation of revenues (increasing 1.5% per year, on average, but APRUs are steadily declining), all of which leads to:
- Anger – specifically with regulators and anyone else CSPs can apportion blame for their plight to
- Greed in the form of short-term profit-taking and a deficiency in long-term thinking and investment
- Envy at the success of the big internet companies
- Lust for big but speculative acquisitions, which end up destroying value
Crawshaw concluded with a summary of the potential benefits of digital transformation for CSPs if they get it right. Not only will it result in an improved customer experience, and thus lower churn, it will also allow the agility adapt and innovate, perhaps ultimately enabling them to become digital platform providers, with IoT identified as the most significant opportunity in this area.