Telecoms operators are facing headwinds: here’s how to change course.
Telecoms operators should be flying high.
Over the past 20 months they have been a linchpin of societies and economies, keeping businesses going, families talking and us all hooked to Netflix. And yet, from February to December 2020, telcos created less value for shareholders than nearly every other sector, according to Bain & Company.
This raises the question: why? Why is a sector that seems so vital and so timely struggling to deliver?
The answer is that telcos are battling multiple, aggressive headwinds, which are hampering their growth. Firstly, they’re facing cost pressures, stemming from the need to constantly maintain and upgrade network infrastructure.
They’re also contending with new customer expectations of experience. Digital leaders, including Amazon, Netflix and Deliveroo, have raised the bar when it comes to fast, seamless self-service, and people are now looking for every B2C interaction to be just as slick. This customer need is also paving the way for new market entrants, ratcheting up competition, which is already high due to the tough regulatory environment.