This blog is for Communication Services professionals to discuss and share perspectives, point of views and best practices around key trending topics.

May 12, 2016

Evolution of a CSP into a DSP

It's time for telcos to take a call: to remain a communications service provider (CSP) providing digital experiences, or transform into a digital services provider (DSP), which also offers communication services.


Telcos need to make an informed decision and act fast for three reasons:

  • Exponential demand: The demand for real-time mobile digital services, which rely on connectivity, is at an all-time high and continues to grow, in both consumer and enterprise segments.
  • Emerging market segment: Shortly, alongside consumers and enterprises, Internet of Things (IoT), API-enabled systems and digital platforms will itself become a market with autonomous buying decisions about the choice of connectivity provider.
  • Ubiquitous software: Every layer of the stack - network, infrastructure, applications, data and process - is now software-enabled, intelligent, and available at compelling price-performance ratios. It enables rapid disintermediation, with new digital services providers emerging constantly.

Like other businesses, telcos have a penchant to think outwards from the network, services, and products. We propose ideating from human needs, inwards. Infosys is helping telcos adapt to the rapidly evolving environment, better understand the digital consumer, and empathize with the millennial generation.

Remember Maslow and his 'Hierarchy of Needs'? Well, it applies to the digital age too, with a few tweaks. We are taking a shot at developing a digital prototype, in collaboration with client stakeholders across industries.

Our early observation: the most basic layer of the hierarchy - access, connectivity, communications, information, entertainment, and human services are already met by several providers with a simple digital platform built almost overnight.

Communication services are provided by WhatsApp, Skype, Instagram and WeChat; entertainment by video and media OTT service providers such as Spotify and Netflix; information services such as Flipboard, Vox, BuzzFeed and NPR; and utility services by Uber, Airbnb and Amazon.

A traditional telco will find it challenging to compete with agile platform providers. So it can reposition itself as a horizontal integrator of digital services providers - an intermediary, a choice fraught with danger, or select white spaces in basic digital experiences such as healthcare, insurance, education, security, and immersive lifestyle experiences.

A digital version of Maslow's 'Hierarchy of Needs' reveals that higher layers of the hierarchy are, as yet, largely untapped:
Safety: can be interpreted as security, privacy and trust.
Love and belonging: can be interpreted as family, friends, and community-based digital experiences.
Esteem: will foster experiences of being recognized and respected.
Self-actualization: involves experiences that facilitate creativity, purpose, morality and spontaneity.

So DSPs can transform their business and operating models for higher level motivations and needs - a space that has few competitors. Is this a tall order for traditional CSPs? Maybe, but basic connectivity services are already commoditized. So it is an obvious choice.

We are using Design Thinking to help our clients embark on this transformation, to uncover specifics of their objectives and unique problems. This approach focuses on customer empathy to uncover digital experiences that are desirable, feasible, and viable.



 




May 10, 2016

Less conversation, more action

 

The communications galaxy is gravitating from one orbit to another at supersonic speed. The humble mobile phone has become uber smart in the hands of subscribers during the lifetime of one generation alone. In Sweden, the mobile phone is referred to as 'nalle' because users carry it around everywhere they go, fearing they might misplace their 'teddy bear.' The irony is not lost on us on how the mobile phone has become a new life form - depending on who uses it, the smartphone is a virtual assistant / concierge, bank, retailer, learning institution or social network.


The communications service provider (CSP) is in the crosshairs of two demanding constituents: on the one hand, the millennial generation seeking unique experiences and on the other, non-traditional competitors riding the telecom bandwagon on the edges of the ecosystem. The subscriber does not care who delivers a nifty app or service that makes living and working a breeze. Most users cannot even distinguish between the network and the over-the-top service provider. Subscribers are looking for a bouquet of digital experiences that empower them, irrespective of the source.  

This latent need of the digital generation presents opportunities as well as challenges. From a business standpoint, telcos need to upgrade network infrastructure to deliver superior service. However, every successive capex cycle does not translate to higher average revenue per user. In an industry landscape where - all factors being equal - there is no direct correlation between a technology shift and incremental revenue, CSPs need to reinvent themselves as genuine experience providers. The smartphone gives CSPs a gateway to become embedded in the lives of subscribers.

The CSP can enhance the lifestyle of the digital subscriber at home, on the go as well as at work. The subscriber's network can morph into a catalyst for seamless convenience and all-round productivity. The Internet of Things (IoT) enables CSPs to harness automation and machine intelligence so that subscribers can control events and navigate situations at home or the workplace with precision and finesse. It presents an opportunity for CSPs to appropriate the high ground of experiential services across touch points, thereby altering the relationship dynamic between the CSP and subscribers.


Elvis Presley sounds prescient when he crooned, "A little less conversation, a little more action please;

A little more bite... and a little more spark..." It is precisely what the millennial user yearns for from CSPs. Inevitably, opportunities do not knock, they ring across the telecom ecosystem. If the CSP is not omnipresent at every milestone event and at every life stage of a subscriber, the online retailer, banker or social network may well disrupt the dynamics of the telecom industry very shortly.

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