Five Ways Telcos Can Optimize OpEx To Boost Revenue

4 Mins read

For communication service providers (CSPs), Charles Dickens’ famous opening lines from A Tale of Two Cities—“It was the best of times, it was the worst of times”—probably feels accurate right about now. There has never been more opportunity as a CSP, with new technologies such as VR, 10G and Wi-Fi 7 hitting the scenes, and the door is wide open to move from pure-play broadband providers to digital service providers. However, at the same time, high customer turnover and steep competition are eroding profitability right when an economic downturn is making it harder to stay afloat.

In a 2021 report from TM Forum titled Cloud and Automation: Changing CSPs’ Outlook, the organization notes that “Over the last 10 years, revenue growth has proven elusive, forcing CSPs to focus increasingly on cost management and, more recently, cost cutting.”

Increasing revenues isn’t always about adding new subscribers. Here are five ways optimizing operational expenditure (OpEx) can lead to revenue growth during an economic downturn.


1. Transform Infrastructure With Network Intelligence

Network optimization involves the use of best practices to improve the way your network performs. After all, subscribers expect perfect reliability and availability as standard. With the right data, CSPs can make targeted decisions about their infrastructure (e.g., choosing where necessary upgrades should occur, keeping track of common problems across the service delivery chain and identifying bottlenecks in the moment of need).

Uncovering these insights rely on big data analytics, which are already responsible for as much as 34% of all carrier revenue.

Instead of sending technicians out to replace a router every time a customer experiences a service degradation, by gathering the data on what’s really happening in and outside the connected home, CPE replacements, dispatches and truck rolls can be minimized to where they are actually needed. Fewer operational costs and your customers will receive better service.


2. Add Value To Your Offering

A telco today needs to wear many hats. Instead of relying on traditional voice and data bundles to serve subscribers, the global trend is for CSPs to expand their offering by adding over-the-top (OTT) services, a market that is estimated to be worth almost $300 billion by 2028.

By considering internet as their core service—and then following in the lead of big players such as AT&T and Singtel by offering gaming or streaming bundles, for example—CSPs can become entertainment service providers and grab a slice of a new niche altogether. As streaming services and online gaming continue to rise in popularity, this is a safe bet in terms of future focus and assured revenues.

Other ideas for CSPs in terms of OTT services include business cloud solutions, and products that leverage 5G such as edge computing or IoT.


3. Grow Subscriber Loyalty

There’s no shortage of statistics that prove it’s more cost-effective to retain your subscribers than hunt for new ones. However, the relationship between a CSP and its end users is a fragile one. The results are in, and customer loyalty in telecoms is down 22% since Covid-19. While it is easier than ever for customers to move to your competition, attracting and acquiring new customers gets continually more expensive for the business.

CSPs that haven’t put technology in place to take on customer experience management are already considered lagging adopters. One example is self-care capabilities that add visibility and control for the end user while simultaneously taking the weight off support teams. But technology can go a lot further, too, offering both reactive and proactive support measures for subscribers and identifying the true nature of each home’s internet experience.

Imagine you had a dashboard that highlighted exactly which homes were suffering and, critically, why. These are your “at risk” subscribers (those in the red zone) on the verge of churn. However, with this visibility, it’s not too late. You can target these customers to improve their quality of experience and watch them renew and move safely back into the green.


4. Maximize Per-Head Revenues

According to McKinsey research, churn reduction is just step one. While CSPs are in the early stages of utilizing big data, “Very few telcos—only around 5%—are unlocking the full potential of analytics and data-driven personalization to achieve true competitive advantage and to maximize revenue growth.”

One idea is to use data for audience segmentation and offer personalized outreach opportunities. Even subscribers who are signed up for the same data package may have vastly different connectivity use cases. One home may house heavy gamers, while another uses the web primarily for working from home and still thinks Fortnite is just another word for biweekly.

Knowing your subscribers, including their behavior on the web, means that you can create personalized offers, such as those OTT bundles we mentioned earlier. This makes it easier to increase per-head revenue while simultaneously providing a more holistic experience for the subscriber and increasing the stickiness of the relationship.


5. Improve CSP Efficiency

Now more than ever, every decision that a CSP makes needs to start with how it’s going to add efficiencies for the business. The best way to be sure that you’re making intelligent decisions is to return to the data. With the right data, you can answer questions like:

• Do I need to send a technician to this specific customer home?

• Is there a necessary infrastructure upgrade related to this issue?

• What is the root cause of this customer query?

With these answers in hand, the support team can become more efficient, reducing its average handle time (AHT) and improving first call resolution (FCR) rates, and managers can know for certain that support or network investments are being directed accurately.


Looking To Optimize OpEx? It’s All In The Data

For CSPs looking to boost revenues in a challenging macroeconomic environment, data is the key to moving that needle. It provides the network intelligence and subscriber insight necessary to target upsell opportunities and OTT services, personalize at scale and move from generic approaches in customer care to those driven by intelligence.

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