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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.



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