ABI Research says diminishing revenues, growing consumer demand for digital services, and a lucrative but underserved enterprise market mean that traditional telcos can no longer afford to be merely connectivity providers.
The firm says telcos must transition to becoming technology companies (techcos) to survive.
“The traditional telco business model must be reinvented. ABI Research sees a clear signal for mobile operators to increasingly deploy automated solutions to streamline operations, optimize resource allocation, and drive cost efficiencies. At the same time, the big focus now for mobile operators is on added consumer services and enterprises in dire need of 5G connectivity for their digital transformation efforts,” says Dimitris Mavrakis, senior director at ABI Research.
ABI Research says telcos must take these four steps telcos to transform into techcos:
- Embrace 5G-as-a-Service
- Invest in vertical ecosystems
- Digitize network management
- Become active contributors to cellular innovation
Transforming into a techco can be a huge change for many mobile operators, requiring a re-evaluation regarding technological capabilities, corporate culture, and target audience. Therefore, it’s vital to map out strategies to support this transformation effectively.
ABI Research also places emphasis on the importance of The 3rd Generation Partnership Project (3GPP) standardization and Standard Essential Patent (SEP) development, and how telcos need to be involved in both standards discussions and owning a significant patent holding.
