Adapting to the Fundamental Changes in the Telecoms Market

As the news continue to unfold in on hourly basis covering the recent developments on the global pandemic, it is good to reflect on the role that the telecommunications industry plays in all of this.

1. Major interruptions on both demand and supply

Telecom operators have been forced to close many of their retail outlets, shifting customer care traffic and devices sales to online channels. This has been the trend already for some time, but the speed of this change has been so quick that online channels have been struggling to keep up.

Mobile devices sales have been severely hit both due to supply challenges (initially, although recovery has taken place), followed by consumer demand issues. According to Strategy Analytics, worldwide shipments of smartphones dropped by 38 per cent on year-on-year basis in February.

We saw announcements of both Facebook and Twitter, who warned of negative impacts on their financials due to lower global advertising revenues.

However, need for connectivity has not changed – I would argue it has increased. And the role of telecommunications industry has an essential role to play in all of this.

2. Increasing network capacity – but in the short term not the way you would expect

In many markets we have seen increases in the demand of telecommunications services. More starkly, there have been changes in the demand patterns as the time, location and type of usage have changed drastically. Telecoms operators have been working hard to address these changing needs. We have seen operators like Verizon boost their investments in networks.

However, in the short term, the delivery of this capacity will be done very often through existing LTE networks instead of 5G, as many European countries (France, Austria, Spain and Portugal) are holding back on their 5G actions. This has been recognized even by Matthew Iji of GSMA Intelligence. Link: www.mobileworldlive.com/blog/intelligence-brief-how-will-covid-19-impact-5g/

The need for connectivity has not changed – there has just been a major shift in when, where and how. Max Reimpell of BCG did write an excellent article on this: “Time for action: In times of COVID-19 Telco need to move rapidly to be part of the solution”. Link: www.linkedin.com/pulse/time-action-times-covid-19-telcos-need-move-rapidly-part-max-reimpell

3. Reducing the load in the telecoms’ networks

In the short-term, the load in telecoms networks is driven mainly by OTT streaming and videoconferencing. European regulatory body BEREC warned that net neutrality should be followed preventing blocking, throttling or prioritizing specific types or sources of content.

Many OTT companies, including Netflix, Google’s YouTube, Amazon, Facebook and Disney+ announced that they would be restricting streaming to standard definition. This will in turn reduce the load on telecoms networks in the short term.

The need for connectivity has not changed – in short term, actions have been taken by OTT companies, but in the medium-term, telecoms operators need to address these changing usage patterns.

4. Focus in the core – providing connectivity

Number portability was put on hold temporarily in Spain to help operators to focus on essentials – providing connectivity. Furthermore, UK government has secured commitments from major mobile operators and ISPs for removal of data caps to protect vulnerable customers.

The need for connectivity has not changed – focus is increasingly on serving the customer instead of the competition.

5. Use of technology to fight back

We have seen numerous examples where technology is being used to fight back. Telecoms operators in Germany, Italy, Austria and UK are helping government officials to monitor adherence to restrictions of movement and social distancing rules. However, all this needs to be done in line with privacy and security regulations.

On the other hand, the use of mobile money is encouraged to get consumers to avoid face-to-face transactions with currency or cards.

At Netradar, we are working closely with telecoms operators to support them in enabling consistent mobile network quality and connectivity by assisting them to focus their investments in the right places to improve customer experience.

Benchmarking operator network performance against competition only for the purposes of building a marketing campaign “The best network in country X” does not really help to improve connectivity.

Netradar recommendations to operators:

1. Focus on your customer

Telecoms operators need to understand from customer’s point of view what are the fundamental changes in demand patters in order to address them. Telecoms operators need to build a detailed heatmap with geolocated usage information highlighting potential customer experience issues.

Network based measurements are a good starting point, but the location granularity needs to be improved to ensure that actions to improve connectivity are correct. Furthermore, as multiple connectivity methods (cellular, Wi-Fi) are in use, the overall picture needs to cover all of this.

2. Focus on network usage and consumer experience

As we saw earlier on, consumers’ usage patterns have changed fundamentally. So, in addition to having visibility to aggregated geolocated usage data, telecoms operators need to have visibility to actual usage patterns.

Should a consumer only get 5Mbps throughput, telecoms operator needs to identify if the network is congested or if the user is in a bad radio environment, is the issue with the cloud service, or is a particular device model, mobile operating system or even a single device the limiting factor, or if this speed is actually normal for this particular app.

3. Focus on the actions to improve customer satisfaction

For many telecoms’ operators, the scenario is very much known – raw data pours in from multiple sources and they are overwhelmed with limited resources to process all of this, let alone to produce actionable insights which drive improvements. Increasingly, telecoms operators are using AI based tools for identifying network anomalies or angles where they can improve customer experience and satisfaction.

Should you want to understand, how your network copes with these challenges, get in touch with us to receive a free of charge analysis of your network or just a demo of the Netradar solution.

Netradar is fully geared to support our customers in this very challenging market situation!

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