# Are we at a ‘digitise or die’ tipping point in the telco space?
Author:  Pal Sinha, Barnali 
Author URL: https://financedigest.com/author/pal-sinha-barnali
Published: 2021-12-28
Category: BUSINESS
Category URL: https://financedigest.com/category/business
Meta Title: Unlocking Growth: Why Telcos Must Embrace Digital
Meta Description: Discover why telecoms sector growth remains stagnant and the importance of adopting digital technologies for customer loyalty and success.
URL: https://financedigest.com/are-we-at-a-digitise-or-die-tipping-point-in-the-telco-spacehtml

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**_By_ _Sara Rasmussen,_ _Chief Commercial Officer at Telness Tech_**

For years, growth and profitability within the telecoms sector has remained muted at best – and it’s set to stay this way. From February to December 2020, telcos created less value for shareholders than nearly every other sector [\[1\]](#_ftn1). And while the pandemic showed just how important these organisations are to societies , the market is predicted to remain stagnant (+0.1% compound annual growth rate) up to 2024 [\[2\]](#_ftn2).

There are multiple, complex reasons why the sector is floundering but many link to organisations’ reticence to adopt digital technologies. This has made them less agile, and less able to  respond to countless challenges. Now, with customer, investor and legislative [pressures mounting](https://www.financedigest.com/factbox-global-banks-take-axe-to-jobs-as-cost-pressures-mount.html "Factbox-Global banks take axe to jobs as cost pressures mount"), operators are finding themselves in a ‘do or die situation’. Do they endure the short-term growing pains of [digital transformation](https://www.financedigest.com/managing-the-cost-of-digital-transformation-with-saas-optimisation.html "Managing the Cost of Digital Transformation with SaaS Optimisation")? Or do they let legacy infrastructures and processes consign them to history?

## Answering customers’ calls with tech

[Rising consumer](https://www.financedigest.com/factbox-how-far-are-uk-energy-bills-set-to-rise-and-what-help-are-consumers-getting.html "Factbox-How far are UK energy bills set to rise and what help are consumers getting?") expectations are an increasing source of heat for telcos. Leading technology organisations, including Netflix and Amazon have [raised the customer experience bar for every](https://www.financedigest.com/legislate-raises-3-6m-to-give-startups-smes-the-technology-to-query-and-compare-every-contract.html "Legislate raises .6M to give startups & SMEs the technology to query and compare every contract") business. People now expect to be able to get exactly what they want, themselves, at the touch of a button.

For telcos, this means taking a long, hard look at the [services they provide and how they deliver these to customers](https://www.financedigest.com/how-customer-services-has-changed-during-covid.html "How Customer Services Has Changed During Covid"). In a world where [people can order world cuisine to their door in minutes, are they really offering the flexibility and personalisation that people have come](https://www.financedigest.com/power-to-the-people-how-consumers-are-calling-the-shots-when-it-comes-to-data-privacy.html "Power to the people: how consumers are calling the shots when it comes to data privacy") to expect??

For most, the answer will be a resounding ‘no’ – and this is [giving rise](https://www.financedigest.com/german-bond-yields-give-up-rise-after-u-s-price-data.html "German bond yields give up rise after U.S. price data") to a huge opportunity. Those operators who are able to break the mould and provide [customers with the services and experiences](https://www.financedigest.com/the-new-client-adviser-experience-in-the-age-of-the-customer.html "The New Client-Adviser Experience in the Age of the Customer") they’re looking for will win their loyalty.

But to do this, they [must invest](https://www.financedigest.com/true-operational-resilience-must-include-investing-in-esg.html "True operational resilience must include investing in ESG") in technology. This [includes customer-facing applications](https://www.financedigest.com/chemical-process-mixers-industry-2021-includes-the-major-application-segments-and-size-in-the-global-market-to-2028.html "Chemical Process Mixers Industry 2021 Includes The Major Application Segments And Size In The Global Market To 2028"), such as chat bots, but also their underlying infrastructure. Telcos urgently need to adopt cloud-native platforms that will give them access to the data they need to understand [changing customer](https://www.financedigest.com/how-brands-can-adapt-marketing-tactics-to-better-suit-customers-changing-shopping-habits.html "How brands can adapt marketing tactics to better suit customers’ changing shopping habits") demands, and respond to these with new, highly targeted propositions, at lightning speed.

## Tackling the skills shortage

However, adopting the right [technology is only one part](https://www.financedigest.com/automotive-exterior-trim-parts-market-size-industry-report-analysis-growth-future-trends-top-manufacturers-and-technology-toyota-boshoku-corporation-plastic-omnium-cie-automotive.html "Automotive Exterior Trim Parts Market Size, Industry Report Analysis, Growth, Future Trends, Top Manufacturers And Technology| TOYOTA BOSHOKU CORPORATION, Plastic Omnium, CIE Automotive") of the equation. Telcos also [need to make sure](https://www.financedigest.com/need-additional-funding-but-not-sure-how-to-go-about-it.html "Need additional funding but not sure how to go about it?") that they have people with the digital, analytics and infrastructure skills to make the most of this. This is easier said than done when the technology, media and telecommunications (TMT) sector, and telecoms in particular, is [facing a real digital skills shortage](https://www.financedigest.com/britain-facing-tomatoes-shortage-after-overseas-harvests-disrupted.html "Britain facing tomatoes shortage after overseas harvests disrupted"). [\[3\]](#_ftn3)

There are a number of ways that telcos can address this. Firstly, they can create talent development [programmes and academies that will help them build](https://www.financedigest.com/reckon-one-builds-momentum-with-strong-backing-from-accountants-joining-the-cloud-advisor-programme.html "Reckon One builds momentum with strong backing from accountants joining the Cloud Advisor Programme") these skills. This is a cost-effective and sustainable approach, but also takes time – and the [clock is ticking](https://www.financedigest.com/explainer-clock-ticks-down-towards-a-russian-default.html "Explainer-Clock ticks down towards a Russian default").

The alternative is to [partner with a startup](https://www.financedigest.com/uk-gold-investment-startup-minted-partners-with-lux-rewards.html "UK gold investment startup, Minted, partners with LUX Rewards") – or ‘teltech’ – that was born from technology and has the expertise that telcos need. This approach is much faster, and effectively frees two birds with one key, by giving operators [access to best-in-class technology](https://www.financedigest.com/the-electronic-access-control-systems-market-to-prove-its-servility-to-technological-advancements.html "The Electronic Access Control Systems Market To Prove Its Servility To Technological Advancements"), and the people able to implement it really well.

## Rebooting organisational processes

Upgrading technology infrastructure and getting the right people in place will still only get telcos 75% of the way there. They also need to commit to evolving the [way they operate](https://www.financedigest.com/finance-operations-efficiency-7-ways-to-slick-up-your-department.html "Finance operations efficiency – 7 ways to slick up your department") to get the most out of these changes. It’s no good having the latest tech, if organisations still have processes from the 90s.

This recalibration [needs to run](https://www.financedigest.com/time-has-run-out-3ds2-is-here-and-retailers-need-to-be-on-board.html "Time has run out – 3DS2 is here and retailers need to be on board ") through the whole organisation, including procurement and legal teams. Often these can slow [organisations down and make it difficult for them to work](https://www.financedigest.com/uk-based-bitfount-raises-5m-seed-to-streamline-collaboration-between-organisations-working-with-sensitive-datasets.html "UK-based Bitfount raises M seed to streamline collaboration between organisations working with sensitive datasets.") with smaller, specialist parties. It’s important that these teams understand why the organisation needs to [transform and the role that startups can play in this journey](https://www.financedigest.com/the-road-to-transformation-raconteur-ceos-journey-from-near-bust-to-boom.html "The Road To Transformation: Raconteur CEO’s journey from near bust to boom"), so that they help, rather than hinder the process.

Organisations also need to really compress their planning cycles. Most telcos still [plan three to five years](https://www.financedigest.com/austria-plans-to-bring-budget-deficit-within-3-of-gdp-next-year.html "Austria plans to bring budget deficit within 3% of GDP next year") in advance, but when consumer expectations are changing all the time, this is a recipe for disaster. [Telcos need to be able to spin up new services](https://www.financedigest.com/emergency-call-services-telcos-urge-eu-to-protect-telecoms-networks-from-power-cuts.html "Emergency call services, telcos urge EU to protect telecoms networks from power cuts") quickly and then iterate these. This will [demand changes in the way everyone works](https://www.financedigest.com/apples-australian-workers-go-on-christmas-strike-demanding-better-wages-work-terms.html "Apple’s Australian workers go on Christmas strike demanding better wages, work terms") – from engineering teams to marketing.

## Legislation compelling change

Telcos need to digitise to remain competitive, but making this shift is also important from a compliance perspective. The telecoms sector is highly regulated, and is about to become more so with the introduction of the new [Telecommunications](https://www.gov.uk/government/news/new-telecoms-security-law-to-protect-uk-from-cyber-threats) [Security Bill](https://www.gov.uk/government/news/new-telecoms-security-law-to-protect-uk-from-cyber-threats). Having a

water-tight, up-to-date technology infrastructure will be critical to defending against [security threats](https://www.financedigest.com/russian-threat-to-baltic-security-rising-estonian-intelligence-report.html "Russian threat to Baltic security rising – Estonian intelligence report") and remaining compliant.

When we step back and look at the telco landscape as a whole, it’s [clear that organisations](https://www.financedigest.com/germanys-bafin-tells-eurex-clearing-clearstream-to-clean-up-organisational-deficiencies.html "Germany’s BaFin tells Eurex Clearing, Clearstream to clean up organisational deficiencies") are reaching a ‘digitise or die’ moment. The [steps organisations](https://www.financedigest.com/6-steps-to-organising-an-introvert-friendly-networking-event.html "6 Steps to organising an introvert-friendly networking event ") take to digitally transform now will define them for years to come, and those who act first will leave others in the dust.

[\[1\]](#_ftnref1) [https://www.bain.com/insights/telcos-in-2021-challenges-are-back-with-a-vengeance/](https://www.bain.com/insights/telcos-in-2021-challenges-are-back-with-a-vengeance/)

[\[2\]](#_ftnref2) https://www.accenture.com/\_acnmedia/PDF-162/The-Tech-Driven-Telco-Sep-2021.pdf#zoom=50

[\[3\]](#_ftnref3) https://www.mckinsey.com/industries/technology-media-and-telecommunications/our-insights/how-tech-med ia-and-telecom-winners-use-talent-to-stay-ahead


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