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Posted on: May 18, 2017

Telecoms: Get Your Data Act Together


Most telecom providers are struggling to achieve the agility and flexibility needed to maintain their competitive position. This matters because the telecom market is experiencing both increasing technological change and eroding margins. In this disruptive period, customer intimacy represents a chance to increase both the existing customer base and the share of customer wallet. This, however, needs to be done in a way that ensures privacy, protects personal data, and responds to market regulations. To accomplish these ends, telecom organizations need to create the operational efficiency to invest disruptively and innovate continuously. For most telecom organizations, this involves a strategic remake of their data architecture so new applications and technologies can easily be plugged into an increasingly complex telecom ecosystem.

Telecom Industry Challenges

Telecom business and data challenges include many things:

1) Market Saturation and Eroding Margins – Consumers today have multiple devices and contracts with telecom providers. For this reason, new customers are generally acquired by pulling customers away from competing providers.

2) Declining Average Revenue per User (ARPU) – ARPU is declining as the customer base increasingly uses alternative such as Skype and Viber which are often free via Wi-Fi access. Telecom vendors are clearly experiencing ‘force commoditization,’ as Geoffrey Moore describes in “Dealing with Darwin.”

3) Revenue Growth – Telecoms require continuous investment to have a chance to retain or grow revenue; with increased competition today there is no ability to treat existing businesses as cash cows, i.e. slow their investment levels.

Telecoms Download the whitepaper, “Balancing Data Privacy, Regulations, and Revenue for Telecom Organizations.”

4) Regulatory Requirements – The telecom industry faces an increasingly complex regulatory landscape. Data privacy regulations have challenged what data can be collected. In the EU, the General Data Protection Regulation (GDPR) establishes significant penalties to companies who do not adequately protect personal data and individuals’ rights to privacy ‘by design and default.’

5) Disruptive Vendors and Technologies – New technologies have reduced barriers to entry for entrants to the telecom market. Voice over Internet Protocol (VoIP) for example, has led to the emergence of Internet challengers. Clearly, telecoms need to scramble to innovate. Notable attempts at telecom innovation include Safaricom in mobile payments and AT&T providing all aspects of digital life.

6) New Services – Telecoms face additional challenges for not owning alternative technologies. Competition includes an increasing number of ‘over the top’ players such as Telegram, Line, Instagram, Skype, Viber, WhatsApp, and more.

7) Customer Loyalty – It costs more to acquire new subscribers. It is essential to identify customers with a history of switching or a high propensity to churn as they will be the hardest to persuade to stay.

Using Data to Overcome Challenges

Telecom organizations do have the opportunity to solve many of their challenges. It may come across as counter intuitive but data protection can actually underpin business strategies that enable decreasing churn, increasing opportunities for cross selling, upselling and data monetization while reducing operational costs and risk to privacy, sensitive data and regulatory compliance. A holistic approach to data protection provides the following business capabilities:

  • Enhancing Customer Data – Creating a single view of a customer enables a 360-degree insight into their interactions which can help with managing all parties--prospects, contacts, and customers. Yet integrating data from multiple sources to achieve this single view needs to be done safely to prevent internal and external misuse or abuse of information. Part of this involves ensuring that only the right customer data is shared with external parties. 
  • Improving Analytic Insight – Big data technologies can empower telecom firms to embrace predictive analytics which can enable new service offerings, the ability to generate insights from new sources like social media, or even the adoption of new business models. Making this work requires a combination of big data platforms with traditional data management capabilities but regardless of the amount, speed or volume, data needs to be combined securely without compromising usability to generate customer relationship views and predictive insight. 
  • Accelerating Cloud Migration – Adopting cloud based services can reduce operational costs by as much as 20 percent and move outlay from CAPEX to OPEX. While this can allow for cost takeout and modernization, many telecom companies have a muted response to public cloud because of the associated data security concerns. Enabling data control for telecom firms accelerates migration to public cloud and the reinvestment of capital in disruptive innovation. 
  • Controlling Data Security – There are numerous systems in the telecom environment that are utilized to just create new customers and provision their cell phones. Customer data is housed in a plethora of systems and data marts, so ensuring sensitive data is continuously protected means dealing with multiple sets of customer information in various locations. Protecting sensitive data itself and managing access to it wherever it flows compliments existing security controls to fill gaps and harden an organization’s security posture. This approach provides capabilities around knowing where data resides, who has access rights, when it has been accessed, and how frequently.

Parting Thoughts

As mentioned throughout this post, it is essential that telecom organizations get their data act together. This means that they put together a complete picture of consumers but at the same time, they become better data stewards. Without the latter all the intimacy sought can be lost in an instant. To learn more, please look at a detailed brief on this topic, “Balancing Data Privacy, Regulations, and Revenue for Telecom Organizations.”