Telcos: It’s not about technology, it’s about entertainment
By Masyitha Baziad April 15, 2016
- Speedy networks a must, but they’re only an enabler for customer experience
- ‘You need to make sure everyone can tap into that experience easily’
WITH the explosive growth of data, the telecommunication industry is facing the challenge of shrinking voice and SMS revenues.
The playbook has changed. Telcos now have to look at their business as a service, suggested Huawei Consulting principal consultant Nigel Bruin.
The growth of data “has become an operational problem, a cost problem,” he said during a panel discussion at the Broadband TV Connect Asia Conference (BBTV Asia) in Jakarta on April 12.
“The only game to play now is to stop thinking that telecommunications is a technology venture – it is now moving towards becoming an entertainment industry that delivers content and experience,” he added.
After having spent hundreds of millions of dollars building out their networks and establishing their customer base, the game has changed for telcos.
But rather than running around in circles trying to find the best strategy to win the market again, they have to move away from their traditional services and do something totally different, Bruin argued.
“Think about applications, content and services – create the best experience you can for those services and deliver them through your network,” he suggested.
Bruin also advised telcos to leverage on the broadband momentum being generated by the Indonesia Broadband Plan (IBP), which aims to expand broadband services throughout the country.
Consumer habits will tend to change once a country has a nationwide broadband network, and in Indonesia’s case, much of it will be driven by mobile, he added.
“When people have faster connections – perhaps not in their homes yet, but through their mobile devices – you can see that they are going to stream more videos or use some pay-TV model on their tablets,” Bruin said.
Like it or not, telcos will have to serve their customers by providing the bandwidth they would need to properly stream video, he argued.
“And video-streaming would only be the first step. Consumers will become more sophisticated, and they will then look for services that they can access from their mobile device, smart TV, smart watch, tablet, or even from their car.
“Then next comes the Internet of Things (IoT) – telcos better prepare themselves to deliver such services to their customers, and not act only as network providers,” he added.
OTT wake-up call
Consumers will get more data-savvy as various mobile broadband and smart city initiatives take off in Indonesia, but this will also create new competitors on the services front: The dreaded over-the-top (OTT) players.
“The faster broadband gets, the more services like this can exist on the Internet, and that is a good thing because the Internet is a platform for innovation,” said Bruin (pic above).
“Telcos actually play a big role in enabling OTT players to flourish – the more telco operators deploy fast broadband, the more innovative it gets,” he added.
But this should also act as a wake-up call to telcos.
“They [OTT players] give consumers the kinds of services they want, while telcos are still competing via traditional voice and messaging services,” said Bruin.
Telcos need to innovate in the OTT space – they can stimulate the market with greater bandwidth, giving people tools to access the services they want, and in that way, win them back as customers, he argued.
“Telcos need to aspire to give customers the total experience and not just the download speeds they need – ‘experience-centric’ ideas should be driving telcos forward,” he added.
This does not mean the network is unimportant, but instead of focusing only on speed, telcos should also look at the breadth of their coverage – they have to move beyond big urban cities like Jakarta, according to Bruin.
“If you have the services and deliver a great experience, it is no use if all this can only be enjoyed by a few – you need to make sure everyone can tap into that experience easily,” he said.
“Make sure you’ve got everyone covered – it’s an all-or-nothing business these days,” he added.
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