If 2017 was the year that digital transformation for telcos took off, then 2018 will be the year it soars higher and faster. With new tech and innovations flooding the market, the mantras will continue to be “fail fast,” “move faster” and “keep moving.” Digital transformation has the unique distinction of being both a marathon and a sprint. Winning is all about the ability to be agile, consistent and on demand.
Here are my predictions for 2018:
#1: THE YEAR OF PEAK UNLIMITED
2017 witnessed the comeback of “unlimited” data plans across the four major US mobile carriers, with value as a key driver in consumer marketing plans. The question is what’s next for 2018?
The next 12 months will see the “Peak Oil” of unlimited data plans, forcing operators to look for the ‘new, new thing’ that will attract and retain consumers. While the rush to offer greater value with unlimited plans is good for consumers, it puts unsustainable pressure on earnings. With new OTT’s and digital economy players entering the market, 2018 will be the year that operators make bold moves to reinvent themselves – embracing differentiation around customer experience radically, content, flexibility and personalized services.
#2: NEW PLAYERS WILL ENTER AND DISRUPT THE SPACE
Founder and VP of Marketing,
New digital-first entrants will continue to find the MNO space attractive, grabbing market-share by offering customers differentiated offerings, including greater insight into data use, a broader choice and exclusive content.
The digital-first, agile companies will have an advantage over their more established competitors regarding the perception of service and brand too. A recent consumer survey highlighted that customers prefer the experience of digital-first companies, with 73% of participants saying they wish their mobile service provider operated more like an Amazon, Netflix or PayPal.
This trend is already happening, Comcast, for example, has recently introduced Xfinity Mobile – and offered both unlimited and flexible pay per GB plans. The flexible plan is proving more popular with customers as it allows them to pay $12 per GB for the data they use each month, and adjust as needed, rather than shelling out the $65 per line for the unlimited plan. This is a trend we’re likely to see catch on across the board in 2018. (Hence the urgent need to heed #1).
#3: THE METEORIC RISE OF THE MIGHTY AMAZON NETWORK WILL CONTINUE APAC
With changes at the FCC removing barriers to zero-rating of content on mobile, Amazon will reduce another barrier to entry to its ecosystem by starting or purchasing a mobile network. This is a considerable threat to existing players in the market because research shows that nearly three-quarters of customers say they would switch to an Amazon mobile offering.
This shouldn’t come as a surprise to anyone with their finger on the pulse of the MNO market: Amazon has held a firm place in the spotlight throughout 2017 amid constant speculation. Its strategy is clear - make it easier for consumers to stay in its ecosystem. Why? To sell more stuff of course!
There is another advantage, though. By doing this on the mobile front Amazon can massively improve its big data collection, so that it can hone its target to consumers even more precisely. Why? Yes, you got it! So they can sell even more stuff. Simple but powerful.
The combination of improving transaction volume over mobile and adding new big data opportunities will prove irresistible to Amazon. Make no mistake the Tech Giant, which touches almost every sector from FMCG, retail, health and more, will make a move to disrupt the mobile market and 2018 is likely to be the year it does.
Amazon could become the aggregator of a consumer’s digital spend by offering personalization and spend management features all in one place. Or, if Amazon can strike the right deals with operators – they could be in a prime spot to offer a converged access-retail-entertainment play, potentially even funding the consumer mobile business through targeted advertising.This is why traditional players must innovate or they will die - murdered by a big, strapping, fleet-of-foot Amazonian.
#4: GAMING WILL BECOME A GOLDMINE FOR TELCOS
Mobile. Console. PC. VR. AR. Gaming is big business. As with movies & TV shows, games garner the eyeballs. The average gamer, for instance, spends 6.5+ hours per week playing. Add in the potential for new AR experiences that will come into the market, and the time spent ‘in-app’ will only increase.
Powered by a perfect storm of AR mainstreaming, continued growth in mobile gaming, expanding popularity of esports and an insatiable hunger for new content sources, 2018 will see telcos make aggressive moves into gaming.
Adding to the value, 2018 will see the lines between dedicated console games and mobile gaming continue to blur, as consumers increasingly embrace cord-cutting, switching from a pay TV subscription to an internet-based streaming service.
What does this all mean for telcos? Whether through zero-rating of data, exclusive distribution of games and esports events or outright acquisitions of publishers and developers, we’ll see telcos leverage data-intensive gaming as a way to win loyalty and drive consumption across their networks. For operators looking to increase the reliability of its customer base, gaming is an easy angle to exploit - one that is not yet fully exploited to saturation point, as are film and television.Beyond loyalty, telcos will become attracted to gaming by its revenue potential. After all, the games business generates more than $100 billion. As the popularity of games grows, so does their potential for new revenue - mobile gaming alone is expected to grow to almost $52 billion by 2019. Just as with film and TV libraries, telcos will be able to realize this revenue potential through deals and outright ownership of game developers and publishers.
Whether through game license fees themselves, or the data required to supply those game experiences, there is big opportunity and telcos are in a great position to take advantage of it.
About The Author:
Jennifer Kyriakakis has been working in the Communications Industry for over 20 years in Marketing, Sales and Systems Delivery. Prior to MATRIXX, Jennifer worked for Portal Software (acquired by Oracle) where she was responsible for the global marketing strategy of Portal’s product suite for the broadband and mobile markets. During her 7 years with Portal and Oracle, she also held positions in Services Marketing, Customer Programs, and Sales Engineering. Before joining Portal, she worked with Verizon International Wireless managing large implementations of billing and customer care solutions for their global operating partners. Jennifer began her career in the Communications Practice at Accenture where she developed billing, invoicing, and payment processing applications for wireless operators. She holds a bachelor's degree in information technology and operations management from the College of William and Mary.