Communication service providers offer new digital services to satisfy B2B markets
The consumer market for telecommunications is mature and competition is fierce. Communication service providers (CSPs) are turning to business to business (B2B) markets to find additional revenue. All segments including small and medium enterprises (SMEs), large enterprises and the public sector, are demanding outcome-based solutions delivered as a service, rather than traditional technology offerings. This poses some challenges for CSPs. Enterprise solutions can be complex and B2B sales involve multiple stakeholders, long sales cycles and highly specific requirements.
Many CSPs are adding digitally-enabled business solutions to their offerings. While these providers are well-established in selling connectivity services and unified communications, they are starting to expand their offerings to include business solutions enabled by cloud, big data and analytics, mobility, social business and security. The Internet of Things (IoT) will drive welcome growth in data consumption, but IoT connectivity needs to be integrated into an overall solution.
Here are some examples of digitally enabled offerings that can help a CSP differentiate itself in B2B markets:
In a recent IBM survey, almost all communication service providers we talked to said the IoT revenue-generating opportunity is the most promising one. CSPs are looking to further expand their offerings for IoT. Instead of solely providing IoT connectivity services, CSPs can provide application enablement platforms, application development services and professional services for end-to-end solutions. Many CSPs are starting to integrate analytics, security, cloud computing and IT services capabilities into their IoT solutions.
However, communication service providers must decide on their IoT business model, how they will make money from it, which vertical markets, such as connected homes or smart cities, they will focus on, and how they will contribute to the overall IoT ecosystem. For example, AT&T and IBM are helping businesses accelerate their IoT initiatives by creating open standards-based tools on the IBM Cloud to enable developers to build and implement IoT solutions more quickly.
Beyond big data and analytics: Cognitive Systems
CSPs have access to a wealth of information about their consumers’ preferences, behaviors and actions. Some CSPs, including Telefónica, Sprint and Verizon, use “downstream” consumers’ information to obtain revenue from “upstream” partners like retailers, advertisers and car manufacturers. Others are delivering innovation based on cognitive computing. Advances in cognitive computing can help CSPs manage this increasing volume of data while exploiting it for greater insights. Cognitive-based systems can build knowledge, understand natural language and provide confidence-weighted responses. And they can quickly locate the proverbial needle in a haystack, identifying new patterns and insights – something particularly relevant for the fast-changing communications industry. For instance, IBM and SoftBank have announced the general availability of six cognitive language and speech services in the Japanese language that can be used to create IBM Watson-powered apps: they include Natural Language Classifier; Dialog; Retrieve and Rank; Document Conversion; Speech to Text; and Text to Speech.
Mobile business solutions
CSPs can combine their own device and network connectivity offerings with functional or industry specific mobile applications. Apps can be individually commissioned, or a capacity to develop apps can be consumed as a service. Mobile apps go much deeper than the user interface with around 70% of effort expended on back-end integration, so integration services are essential. As an example, Vodafone Netherlands announced it would offer IBM Mobile solutions to its enterprise clients.
With their customer access, network assets, data management capabilities, client billing relationships and third-party relationship management experience, CSPs are ideally suited to become ecosystem development and management partners for the enterprise market. We call this emerging role the “Digital Services Enabler” and describe it more fully in our paper Outthinking disruption in communications; The 2020 CSP in the cognitive era.
Through partnering with a technology company that can provide access to the tech, business solutions and go-to-market capability needed to serve the changing needs of the B2B market, we think communication service providers can improve speed-to-market and maximize their chances of success.