Telecom Gears Up for the IT-led Revival

As competition in the crowded telecom market heats up, players will be facing an increasing urge to embrace new technologies to turn the tide in their favour.

- Smita Vasudevan

Intensifying competition in the voice and data segments, heavy payouts in the 3G spectrum auctions, and declining ARPUs (Average Revenue Per User) have deeply affected the financials of the Indian telecom players, resulting in huge amounts of debt. Uncertainties around spectrum allocation and pricing issues continued to impede the growth in 2014. Yet the year was not all bad as the sector’s revenues saw an upward trend, driven mainly by data revenues. According to PwC, the share of data revenues increased from 5-6% in 2013 to almost 12-13% in 2014 for all the leading players. Leading telecom players were also making significant network investments.

Going forward, the telecom companies will be looking at embracing new technologies to capitalize on the growing opportunities in the digital world. Consumers are demanding a better digital experience that makes it essential for telecom service providers to offer improved services while also focusing on internal efficiencies.

“Some leading companies are already getting into the development of mobile applications for higher customer engagement. But with increased automation and platform-based services that can be replicated across segments and non-linear initiatives, SMAC (social, mobility, analytics and cloud services products) will allow the IT industry to offer more value to the clients,” says Gaurav Sharma, Director, Advisory Services, EY.

Big data is making it possible for telecom providers to know their customers better and stay ahead of the curve. “Analytics is becoming a key differentiating capability as consumer needs and targeted hyper-local offerings are becoming more integral to product planning and customer service management, leading to influencing network planning,” asserts Kunal Gangakhedkar, Director, Advisory - Consulting, PwC India.