Digital Transformation in Telecom Industry: Strategies for Telecom Operators


Right off the bat, we can state that digital transformation was and still is needed for any sector to up their game, but as remote working took over the world by storm, following the Covid-19 pandemic, the pressure on one particular area increased – the telecom operators.

Consumers are constantly demanding changes and enhancements, thus, telecoms and service providers alike had to upgrade accordingly, however they too obtained improvements and benefits by digital transformation.

The telecommunication or telecom sector is a big one, with an around €1.5 trillion market that makes communication possibly worldwide.

In this article we explain further why digital transformation for telecom operators is needed, why it matters, its benefits, challenges and more.

So, what exactly does Digital Transformation mean to the Telecom Operators?

Basically, by undergoing digital transformation, the telecommunications sector and its operators like service providers enhance and expand their services through new digital technology in their business.

These may comprise:

  • Phone service
  • Internet service
  • Television service
  • Networking for both business and homes

Benefits of Digital Transformation in the Telecomm Sector

There are various benefits which come with digital transformation which may include:

Automation – Reduction of human errors by automated workflows, while improving operations. This will also result in lessening failures and problems in the telecom network.

Swift network – Telecoms react to changing customers` demands and stay competitive by augmented digital technologies.

Data-driven insights – Digital technology can analyse vast amount of data while providing precise insights, which can enable better scheduling and assist with calculated development.

Improved customer experience – Digital transformation can empower telecom operators and service providers to improve customer experience via digital solutions such as Omni channel customer care services, social media interactions and chatbots on websites.

Key Digital Technologies used in the Telecomm Industry

So, here are some of the digital technologies that are reshaping the telecommunication sector:

Artificial Intelligence (AI) & Machine Learning – The telecom sector utilises AI to identify trends in historical data, and through algorithms it can predict possible hardware failures. AI can also be Conversational, as we find on websites like chatbots or virtual assistants, which manage large amount of customers, handling queries or re-direct them correctly within company`s structure, depending if they need a service, sale or say a technician.

Big Data – Technology utilising big data, compliments value to the decision-making process, providing accurate and actionable insights. For example, companies can make use of network traffic data to better comprehend users` behaviour, which can ultimately improve delivery of filtered out or targeted media content, and the overall customer experience will be more positive.

Process Mining – Basically this method gathers and examines business processes stowed in event logs data generated by IT systems to provide insights on telecom operations. Moreover, process mining facilitates telecoms to monitor, manage, improve and automate processes to accelerate digital transformation.

Internet of Things (IoT) – IoT delivers a smart podium for telecoms to accomplish increased efficiency and improved workplace experience. It can also provide data for predictive, diagnostics and prescriptive analytics services for telecom customers. Global IoT revenue is projected to increase from around €441billion to €1trillion by 2030.

Cloud Computing – Telecoms need to provide an ever-present service to their customers, and cloud infrastructures can assist in delivering that sought after flexibility. One of the big advantages of cloud computing is the considerable amount of IT cost reserves. The telecommunication cloud market will reach €125billion by 2030.

What are the challenges for the Digital Transformation in the Telecom sector?

As telecom companies` business becomes more multifaceted, digital transformation can be a challenge to implement and trying to achieve more swift services.

Some of the challenges could be:

Market Integration – Before, services like fixed-line, broadband and broadcasting were separate markets. Nowadays, for telecom service providers to amalgamate and offer these services, sometimes even as one packet, can be complicated. Difficulties will eventually increase when phenomena like smart cars and homes which are already on the rise become common.

Over-The-Top (OTT) Services – OTT platforms such as Netflix and Disney Plus, have imposed a more flexible business model on telecom companies, working with new operators and allocate revenue to new alliances. An ideally seamless integration in the telecom service providers existing model will surely represent a challenge.

Centralised to Decentralised – Mostly, innovative digital technology is constructed on agile development, so if a telecom company has a centralised system, it can also be challenging to decentralise it in order to implement digital transformation in different parts of their business.

How can Telecoms remain competitive in the future?

In this digital era, telecoms need to move past their legacy IT systems.

Here are some of the components a telecommunication company needs to integrate in their business systems to become more responsive and remain competitive in the market. The below are all considered to be agility drivers.

Near Term:

  • Consolidate Data/Systems – Single view of customers and organisation
  • Polymath (wide knowledge) Organisation – Cross-function collaboration
  • OSS/BSS (operations support system and business support system) overhaul – Upgrade billing and charging

Long Term:

  • Continual Governance – Governance as a process not a project
  • Artificial Intelligence (AI) – NFV as a platform for AI.
    NFV being Network Functions Virtualisation, which is a way to virtualise network services, such as routers, firewalls and load balancers.
  • Collaborative Innovation – Open up network APIs.
    API stands for Application Programming Interface, and the word application refers to any software with a distinct function. Interface can be thought of as a contract of service between two applications. This contract defines how the two communicate with each other using requests and responses.

Final Thoughts

Digital technologies help companies streamline internal processes, such as avoiding duplicate data entry or the need to jump between systems.

Digital Transformation for telecom operators then is essential to keep them competing at high level in the market, offering services where customers, thanks to a fully automated buying experience, will have their orders fulfilled instantly, interact easily, even in an entertaining way, resulting in satisfied customers, who will recommend the service and attract more new clients.

Learn more about our Digital Transformation services.