The telecom and cable operator industry is undergoing rapid and accelerated change with significant impacts to business models, retention strategies, service offerings, and technology investment.
The driving forces behind these changes are:
This whitepaper not only presents the issues operators face in this new business and customer landscape but also offers solutions, recommendations, and strategies to combat these issues by leveraging operator strengths and technologies in new and creative ways.
The white paper is concluded with a real-world case study of one operator’s approach to solve these issues.
The changes that operators are facing are being intensified by the arrival of what was once called "convergence". Convergence is the end-game of the rollout of technologies such as PacketCable 2.0/IP Multimedia Subsystems (IMS), Web 2.0 Frameworks, VOIP, and IPTV. These new technologies unite heterogeneous services into flexible, interoperable, and dynamic IP-based telecommunications offerings.
Operators now compete in a more competitive and technologically open environment. Users now expect operators to deliver connectivity and to provide an arsenal of services and capabilities— capabilities that, when combined in new and exciting ways, transform and evolve their businesses and lead to higher levels of customer satisfaction and loyalty.
The network remains critical, but it is less relevant to the underlying service
Consumers are finding it increasingly difficult to understand or care about how they connect to receive services on their screens and devices. The distinctions between landlines, cellphone networks, and WIFI are being blurred and are becoming less important to the end user. While the need for speedy connectivity remains critical (and grows by the day), the type of connectivity matters less and less.
This separation of network from service is occurring for several reasons.
Over-the-top (OTT) services are third-party services carried over operator networks, delivering value to customers without service provider involvement in the planning, selling, provisioning, or support of the services. Services characterized as OTT typically compete with network operator’s traditional services, like video, voice, and messaging.
While OTT services drive network data revenue, operators have lost revenue opportunities related to product application subscriptions, content, and advertising.
A differentiating feature of OTT services is their strength in delivering a multiscreen experience. Unencumbered by device-centric infrastructure and non-IP based services, OTT providers are able to use any network and any device to reach their subscriber in a seamless, personalized, and multiscreen manner.
Operators have two challenges when delivering their own unified multiscreen services to combat the OTT threat.
First, operators have invested in device-centric service infrastructures . For example, live television and electronic program guides (EPG) use completely different hardware, software, and delivery methods for mobile devices and set-top-boxes. Features are frequently out of sync and the user experience is radically different for each of these screens.
Second, internal organizational structures have slowed the launch of integrated services. Established silos divide departments between video, voice, and data services. These departmental divides exist because these services have evolved at different times, in different ways, and with different methods of transmission. While many operators are moving to a more seamless, convergent organizational structure, it is a huge undertaking and takes considerable time, expense, and effort to achieve. This hinders unification of services on multiple screens.
While only time and realignment can solve the organizational issue, technology can help drive the paradigm shift from device-centric to user-centric experiences. The market must drive the speed of organizational and technical realignment. These market dynamics, and the shift towards unified multiscreen solutions, are discussed in the next section.