CSPs – why 5G and partnerships mean they are primed for that next step

As the reliance on digital only grows, CSPs can take advantage by positioning themselves as the key to enabling a wide range of services through their ability to connect a complex ecosystem of new digital offerings.

Guest author

August 9, 2021

5 Min Read
concept of future technology 5G network wireless systems and internet of things

Telecoms.com periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece Bengt Nordström, CEO of Northstream, part of Accenture, looks at some of the opportunities available to savvy operators.

The pandemic has put every industry under pressure, whether it’s through their inability to operate or the flipside of a dramatic increased reliance on them to keep society going. And with the global shift to remote working and socially distanced communication, our connectivity requirements have gone through the roof. Underpinning our ability to access this has been Communication Service Providers (CSPs).

However, while this reliance may suggest CSPs have seen revenues and growth expand during the pandemic, this is far from reality, as they are increasingly facing commoditisation challenges and stagnating revenues.

This may seem like a daunting prospect, but CSPs still have plenty in their favour to build on in the future. Consumers trust them and they have the right industry relationships to rely on, as well as the necessary infrastructure and skilled B2B workforce to meet customer demands. As the reliance on digital only grows, CSPs can take advantage by positioning themselves as the key to enabling a wide range of services through their ability to connect a complex ecosystem of new digital offerings.

The Large Enterprise market in particular is set to be a key target for CSPs. The focus here must be on showing CSPs’ ability to deliver new and powerful industrial IoT use cases. This is being enabled by the development of networks towards software-defined 5G and the edge’s ability to deploy key horizontal software capabilities. It means CSPs can deliver the personalisation and mission criticality that large enterprise customers are demanding.

All of this is just hypothetical at the moment, unless CSPs kick into gear and get moving. The inevitable question then is, what do they need to do to get the wheels in motion?

Lessons from 4G

The great thing about understanding how to embrace a technology like 5G, is CSPs can look back and learn from how they adopted 4G. This involved large investments across capital, talent, tech and time. It wasn’t CSPs that saw great returns on 4G, but rather OTT players that used the increased connectivity to boost subscribers and share price performance. Whilst core connectivity services are vital, it was the added-on services that showcased the real value that 4G presented.

Rather than continuing down the road of being a connectivity provider, CSPs need to transition to become an intelligent service orchestrator. This means understanding the lessons of 4G and using 5G to create the enablement for horizontal services and vertical solutions, on top of enhanced connectivity services. This can’t be done without a mindset shift from CSPs and needs to be one of the first things to change.

Embrace both 5G and the Edge

The next thing CSPs need to look into is the powerful combination of 5G and edge computing. A great example is combining cloud services with mobile edge networks – this is immediately an upgrade on remote and slower public cloud networks. With this, data can be collected, analysed and actioned locally. It will enable businesses to really feel the full effects of 5G and its ability to deliver capabilities in real-time, fuelling their desire to make decisions more quickly.

Here’s where strategic relationships can come into play. CSPs and tech giants must work together to complete the ecosystem and supply the go to market solutions that large enterprises are demanding. Each has something the other needs – CPS need the edge solutions that 5G will enable and tech companies need the connectivity: It’s a match made in heaven that can crack the enterprise market.

A vertical market smorgasbord

In order for CSPs to really grow though, they need to expand their presence within vertical markets. They can become a key lynchpin in the connected industries market due to APIs’ ability to onboard cross-industry use case supply chains on to horizontal edge platforms. CSPs must again tap into their ecosystem partners to make this work though, as there needs to be continuous innovation within high-value industry services. This is important as CSPs face increased competition from each other, with the advent of eSIMs making it easier than ever before for enterprises to switch providers.

Ultimately, it enables the ability to industrialise the certification, orchestration and onboarding of vertical uses cases – increasing efficiency, productivity and revenue. A great example to pick out is smart manufacturing applications. By bringing computing closer to the data, this in turn drives data storage in the equipment itself and provides better predictive maintenance.

A unique position

CSPs are all set then to uniquely position themselves as that “cross-industry orchestrator”. They have the carrier grade capabilities and assets, whilst the market is increasingly pushing towards 5G, cloud and network modernisation adoption. This unique position will not last forever though, which is why CSPs have to act now, and with urgency. Taking a connectivity and wholesale approach in 5G, or becoming a re-seller to the edge, will put CSPs in danger of seeing revenues dry up. Assessing the market, understanding their place and who to form strategic alliances  with is key to identifying the gaps and establishing themselves as a key provider.

The digital age, 5G and edge computing are here, but no single player offers the full gamut of end-to-end capabilities. It’s time CSPs sit up and partner up or face the continued stalled growth that’s paralysed the industry for years.

 

bengt.nordstrom_3-150x150.jpgBengt Nordström is a senior telecommunications executive, providing business and technology leadership across business strategy development, technology and product assessment, and large transformational programs. Based in Stockholm, Bengt is a Managing Director at Northstream, part of Accenture. Bengt co-founded Northtream in 1998, and held the position of CEO for 11 years – in August 2019, Northstream was acquired by Accenture. Bengt has also previously held the position of CTO and Executive Director of Smartone in Hong Kong, as well as other management positions with Ericsson, Comviq and Netcom Consultants. Bengt has also held a position in the Executive Committee of the GSM Association, in addition to chairing the GSM Association Asia Pacific Interest Group.

Read more about:

Discussion

test new title

See more
Subscribe and receive the latest news from the industry.
Join 56,000+ members. Yes it's completely free.

You May Also Like