Communications Service Providers expect high revenue and margin performance impact from network-led transformation
A new report from Accenture highlights how successful telco and communications industry leaders are ones that have shifted to investing in network transformation. This network-led strategy embeds new technologies to help CSPs maximize revenue potential by offering new, more customized products and services through networks that run faster, better and cheaper.
Extracting more value from network investments
Based on a survey of 200 leaders within CSPs, Accenture’s “Start at the center: Network-led transformation for growth” report reveals that 82% of CSP leaders are expecting to increase network spending by 6-10% over the next three years. And they are expecting tangible results from their investments.
The study found more than three quarters (77%) of executives believe their network transformation efforts will have a high impact on their revenue and margin performance. Surprisingly, only 13% of those surveyed are accelerating their investments in next-generation networks. These leaders have higher expectations about their future performance. They expect 1.5 times revenue and 1.8 times gross margin over others in the next three years.
A cloud-based network allows for end-to-end flexible, scalable network delivery. Almost all CSPs surveyed (95%) see cloudification as important to achieve a cost efficient, flexible network and 83% believe network cloudification will transform their business.
A lack of talent and limited new tech adoption
Despite significant investments, most CSPs are facing challenges to execute network transformation holistically. Half of our surveyed CSPs have not implemented use cases that rely on network automation and analytics, a cornerstone of transformation today. In addition, when it comes to enabling, and innovating from, cloud-based solutions, only 6.5% of respondents believe their company has the right skills and internal culture to manage advanced networks.
Saurabh Kumar Sahu, Managing Director and Lead – Communications, Media and Technology, Accenture in India said, “Operating in a hypercompetitive market, telcos in India are faced with low ARPU (Average Revenue Per User), high churn rates and a complex network architecture. Cloud, data, and automation offers telcos an opportunity to use the network as a differentiator to optimize operations and introduce new products and services for enhanced customer experience and innovation-led growth. In view of future network environments, telcos also need to relook at their talent strategy to map applicable skills.”
