For decades “Broadband for All” has been a global telco quest for digital enablement. Yet the digital divide remains elusive. A recent survey by the Pew Research Center found that 7% of Americans don’t use the internet, and 19 million Americans still lack access to reliable broadband, according to the FCC. Service providers are struggling in the commodity broadband market to find the right business economics to support improved coverage.
Rising telco costs impact pricing for a new focal point. Let’s examine the role telco operational cost cutting can play in the broadband trajectory and socio-economic divide.
Impacting The Socio-Economic Digital Divide
Historically, pricing is the biggest influence on consumer buying. For broadband, many different components make up the price that consumers pay. Typically, broadband service plans include a combination of one-time operational fees, monthly recurring fees and, in specific circumstances, additional one-time fees for things like data consumption overages or contract termination fees. It’s hard to make exact comparisons since packages differ and every network’s Mbps quality varies greatly, but pricing data provides some insights.
According to BroadbandSearch.net, Americans pay roughly three times as much as South Koreans and 40% more than users in France, Japan and Israel. The average monthly bill for internet service in the U.S. is about $61, compared to $29 in Germany, $25 in Israel and $20 in South Korea. The average U.S. price is 43 cents per Mbps, compared to 31 cents in Germany and 26 cents in Japan.
Juggling Broadband Prices Vs. Operational Costs
Pricing in a commodity market like broadband is very sensitive to operational costs and efficiency. With the high OPEX in the U.S., average spending on customer care is also much higher than in Romania or Bulgaria where prices are very cheap. Drilling down into the U.S. price differential versus the rest of the world reveals the operational influence on pricing. For example, installation and activation fees average $80 in the U.S., but they are just $20 in London and Seoul and are included in the price of service in Paris. That’s a large expense in the U.S. for telco operations.
It’s evident that high operational costs impact broadband availability and the socio-economic digital divide. Data on U.S. price variations reveal the pars. A ranch hand in Wyoming pays 12 times more than a yacht owner (or anyone else) for service in Rhode Island. Californians only pay 4 cents per Mbps (on average) and New Yorkers 10 cents for fiber-optic service. Comparable figures in Maryland and Massachusetts go to 55 cents per Mbps and rise even higher to $1.20 in Arizona and $2 in New Hampshire.
Bottom Line: For a viable telco business model, service providers need more operational efficiency.
Five Ways To Empower Your Teams With AI Analytics For Better Service
By empowering customer service professionals with the right AI analytics, telco staff is happier and turnover declines. At the same time, telcos reduce operational costs and improve customer service.
Here are five ways to cut OPEX with AI analytics:
1. Real-time troubleshooting data. Make sure your staff has real-time data that facilitates work for contextual evaluation and immediate service. With new troubleshooting data on the connected home devices, apps, services, and network environment, telcos worldwide provide better service and lower costs for happy customers.
2. Full home visibility. Early resolution is key to efficiency. Trouble ticket resolution is 61% of operational expenses across all technologies. Adding full visibility of the home topology to better leverage care professionals reaps huge benefits and cost savings.
3. Remote self-care. Minimize field service for big OPEX savings. Truck rolls by technician dispatch are three to four times more expensive than remote NOC resolutions. NOC costs three times more for complex customer calls. Self-care enables better remote troubleshooting at NOC to reduce costs and increase the satisfaction of staff. Self-care at home by customers enables greater savings and reduces churn.
4. Task automation. Thirty-seven percent of OPEX is provisioning and de-provisioning. The financial and emotional toll on customer service reps, technicians, network operators and marketing teams is enormous for telco. Reduce labor-intensive work with automation. Use the right AI-enabled provisioning and customer service tools for less burnout and staff churn.
5. Real-time guidance. Telco customer service center staff turnover rate is 30%-45% — which is double than other businesses. Empower your teams with AI guidance in troubleshooting and marketing to reduce staff churn and burnout. This will also help gain real-time insights to boost ARPU.
Reduce Churn And OPEX With The Right AI Tools For NG Telco Success
AI is a beacon of hope for telco. By optimizing workforce operations and related costs, AI analytics have enormous potential to be the needed price equalizer. New insights better support staff and help customers. Hyper-personalization brings new offerings, better prices and more reliability for high customer satisfaction and retention. By empowering telco teams with real-time home data, customers get a faster, simpler contextual diagnosis and value-added services. With OPEX savings, telcos create a new, viable business model for broadband toward realizing the mission of broadband in every home.