Human life is getting a digital makeover. Digital transformation has become the emerging driver of change and in many aspects, it has propelled global economy towards a new industrial revolution, completely virtual in nature, albeit mammoth in scale.

The telecommunications industry is at the forefront of this transition. The past decade has seen telecommunication companies invest heavily in digital technology, which has allowed them to tap into entirely new business models across industries.

Access to a globally connected network allows availability of real-time information, customer support, marketplaces and social programs that in totality enhance the entire experience.

According to McKinsey, there is a strong correlation between profit margin and the following five areas of IT for telecommunication companies:

  • Robust Consumer analytics
  • Digitization of order management
  • Self-service CRM
  • Simplified IT interfaces
  • Business Automation

One can trace back telecom investments to these five broad benchmarks. Companies with digital capabilities in these areas can record a staggering profit margin of 43% compared to the average 21%.

The digital transformation of telecom is helping companies touch newer B2B horizons.

The focus is shifting towards B2B growth markets where potential looms at maximum. According to recent statistics from Bain, growth in business services will be greater than the same in consumer markets for telecoms. The consumer market is set to grow at approximately 0.6% annually while the B2B market can grow at 2.6%. The primary cause of this surge is an increased demand for Mobile Data & Addressable IT services.

Bain Research

The challenge for telecom managers lies in identifying opportunities that are beyond the scope of historical profit models and reshape their organizations to tap into the same.

This is a key roadblock as consumer revenues generate the lion’s share of profits and B2B services are automatically placed as a second priority. Due to this many bottlenecks arise, including:

  • Allocation of insufficient resources and responsibilities.
  • Failure to recognize the opportunity in core businesses across small/home offices, Medium enterprises and corporate customers.

However, the process, albeit long, is not challenging to propagate. The opportunities lie in reducing efforts, increasing revenue potentials and maximizing account profitability and migrating to newer IOT models of the future.

Other issues which block realization of potential in B2B opportunities include:

  • Lower profits than B2C verticals
  • Highly sophisticated buyers with custom concerns
  • Lower margins, given the scalability in B2B sectors.

Managers need to understand that B2B revenues will have longer payback timelines. Therefore, patience and long-term approach will garner benefits for Telecoms when it comes to B2B.

The introduction of in-house full-service smartphone apps for billing, data monitoring and a host of other customer end services is another step companies are taking towards the digital transformation of the telecommunication industry.

The key imperative is to embrace the digital and chalk your landscape in the IoT.

Decisions regarding retaining, upgrading or replacing institutional IT frameworks can be tricky given the scale and size of change involved. However, it has been seen that top telecom companies have streamlined their IT landscapes to effect faster and highly automated business processes. Key steps include removing redundant platforms, automating core processes and smoothening overlapping functions.

There are multiple advantages to be gained through this embrace of IoT technologies, including:

  • Reduction in labour-capital as you need a smaller workforce
  • Unified approach due to automated processes like billing and payments
  • Reduction in service error through machine learning
  • Faster resolution of customer issues

Telecoms will need to embrace 3 essential capabilities to maximize B2B results, which are:

  • Develop a better understanding of B2B customers and deliver disruptive solutions

Telecoms will need to adapt their offerings and deliver products that are generalized but can be customized to suit specific organizational needs. For this, they need to spend on developing better understanding small and medium business owners as well as corporate clients.

  • Add growth sectors to core business

This calls for making decisions based on historical data and then diversifying them into sectors that can generate revenues. Once you have full potential in core connectivity, you can easily leverage opportunities through partners, outsourcing and other direct/indirect channels.

  • Have a product portfolio that can scale industrial heights

The solutions you develop, invest in and offer must be scalable and modular to generate best results. The needs of many must be addressed by singular standardized solutions to attain maximum profitability. For corporate customers, use customized solutions based on standardized building blocks.

Successful telecoms provide or aim to provide 80% of customer solutions with generalized building blocks. Only 20% of the solutions require custom frameworks. Such kind of approach leads to effectiveness and efficiency resulting in healthy growth of revenues over time.

By limiting customization, telecoms keep the complexity of their processes in check.

Examples are already out there. One telecom company created a three-year program to develop a modularized approach to its offerings. It simplified its solutions to a great extent. This helped increase revenues and reduce overall workload.

Another European telecom standardized its IT product catalogue and rescued overall workload by an excellent 25%. It automated its order-to-cash cycle. Over time, this led to better performance and compliance from both the management and customers, leading to higher levels satisfaction all over.

Risk and Challenge Assessment

The potential for growth and marketability when it comes digital avenues is endless, but it is not without potential challenges and bottlenecks. The gains from digitization have already been immense but failed to reach everyone who needs them.

The threat to data privacy and security in this landscape is even greater. There is an explosion of data. In the past 15 years, mobile data traffic has grown by a factor of 400 million. This is just one number. It is estimated that annual data will reach a whopping 44 zettabytes (44 trillion GB) by 2020 and 40% of all data stored will be in the cloud.

This massive scale also creates a solid scope for attackers looking to gain access to information for misuse. Instances can be found in the past decade. In 2014, more than 1 billion personal records were stolen across the globe. The cost of a data breach increased to USD 3.8 million during 2013-15.

Telecom operators have also consistently failed to realize the full scope of digitization. Their share of industry profit has declined from 58% in 2010 to 47% in 2015 and is forecasted to drop further to 45% by 2018.

While pressure on traditional revenue streams increases, telecom operators will have to increasingly invest in new digital avenues to remain afloat and have a share in this digital transformation.

Here are some key pointers to tap into B2B telecom trends:

  • Prioritize allocation of financial and talent resources to B2B services.
  • Planned investments in disruptive IoT that can open up B2B opportunities
  • Help your organization in adapting to the digital era by enabling technologies that help it to market and sell digitally.
  • Consistently focus on improving customer feedback

Recently, a South African telecom made some changes in customer advocacy. These improvements led to an increase in B2B revenues by 15%.

A $2 Trillion Opportunity for Industry and Society: An Interconnected Future

Looking past the challenges and roadblocks, the importance of telecom in digital transformation is critical. Telecom has provided the fundamental building blocks for the digital revolution: access, interconnectivity and applications. It is pegged to play a key role as this revolution takes the mammoth scale.

  • Telecom services like retail broadband will be essential for growth of sectors like ecommerce resulting in a direct value of USD 100 billion in migration.
  • Telecom will play a key role in customized automobile networks for GPS and live to track. Technologies will allow usage-based insurance that could save more than 100,000 lives by reducing traffic accidents.
  • It will enable the electric sector to connect devices on a grid level with the total scope of cost savings for customers reaching a staggering USD 170 billion.

The total value proposition that lies in the digital transformation of telecom is immense both for society and the industry itself.


Newer network models, diversified sources of revenue including B2B, enhanced customer engagement and articulate innovation will take the global ecosystem forward.

The magnitude of impact can be estimated monetarily at USD 2 trillion. Therefore it will be critical for telecom companies to align their strategies to make the most of this massive shift.

Enhanced Security

National assets need to be safeguarded, even more so, when the privacy of the country folk is at stake. Therefore, we should realize the need for a secure global Internet. Cyber resilience measures across network hardware, software and end-user applications are mandatory.

Cyber security will also become an opportunity worth billions as recognition of providers who can tackle threats and guarantee protection will be paramount. At a wider industry level, a collaboration between operators will lead to greater resilience and new business opportunities.

Telecoms all over the world are getting ready to realize the revolutionary vision digital transformation has projected. With the world becoming smaller with billions of smart devices and connectivity becoming a way of life, telecoms of the future will have consistently keep innovating and rebuilding their strategies.

  • Highly focused offerings will yield better results
  • Platform-based solutions will be more disruptive than generalizations
  • Business automation for efficiency and cost reduction will be mandatory
  • Sales driven strategies will need an added agenda of actionable information for enhanced customer satisfaction


In this competitive ecosystem, there are bound to be early winners and late boomers. Some companies will take longer than others to adapt but those who don’t will fall out of the picture.

As the B2B appetite for IT and telecom services grows, businesses will require greater mobility, more storage, tighter security, unsupervised AI communication, data analytics and what not. Companies looking consistently to tap into these opportunities will move with a focused approach and standardized offerings.

Organizations that wait too long are likely to miss out on the tremendous opportunity. Those who act rapidly to gain a better understanding of their B2B customers and their needs will emerge as leaders.