The rise of telco brand value

Larger enterprises have been eyeing up attractive private 5G networks, and DIY deployments that would once again demote the telco to ‘Dumb Pipe’ provider.

Guest author

May 6, 2021

5 Min Read
Sending money periodically invites expert third parties to share their views on the industry’s most pressing issues. In this piece David McGlew, Marketing Director at Openet, discusseshow the move to online economies is driving up the value of telco brands.

I was struck by a recent news headline covering a report from the organisation, Brand Finance, who measure the relative value of Brands. The news article highlighted a report that explored the Irish market and called out the increase in value of Eir, a local CSP whose brand value increased by 16% in the past year. This increase was the 2nd biggest increase of the 25 brands measured and was remarked on because Eir had some very public customer service issues in 2020.

This increase caught my attention and made me wonder what the drivers for it were. After some investigating, it was clear that the critical nature of connectivity for individuals and businesses that switched to remote working during the pandemic was a key factor in Eir’s brand value increase.

In the Irish context this bucked the trend where the total value of Ireland’s top 25 most valuable brands has dropped from €20.3 billion in 2020 to €17.5 billion in 2021. Across the top 25 brands measured, on average, they lost 11% of their brand value year on year, while Eir saw its brand value increase by 16% to €608 million. Following the global shift in work and leisure behaviour since the pandemic, it begs the question, is this something uniquely Irish or are other telcos experiencing an increase in their brand value as well? Has a focus on connectivity highlighted the value in a previously undervalued sector? And importantly, how can telcos go beyond connectivity to cement and further grow their value proposition?

The tale across the continent

Brand Finance has conducted similar audits of other markets internationally and its findings are interesting. Looking at Spain, the sum of the 100 most valuable brands in Spain loses around 13.4% value year on year. Telecommunications and Beer were the sectors with the most brands that increase in brand value.

Grupo MasMóvil is the fourth largest telecommunications operator in Spain that provides fixed, mobile and broadband internet services for residential, commercial, and wholesale customers. Three of its brands Yoigo (+ 20.1%), Pepephone (+ 16.8%) and MasMóvil (+ 29.0%) were in the top ten brands that grew the most in the Spanish inter-sector ranking of 2021. Despite the pandemic, the group has managed to maintain its growth momentum by adding more than 500,000 new clients in 2020. This is due to its extraordinary efforts to keep Spain connected, with numerous studies acknowledging it as the best performing network through the COVID-19 crisis.

In France, Orange retained its title of most valued French brand in 2021, valued at €16.25 billion. In France, Orange was named Best Mobile Network for the tenth consecutive year with 99% 4G coverage of the population. In the past 12 months individuals and businesses relied on connectivity more so than ever, keeping businesses, communities and families connected when they were otherwise cut off. It has reinstated the value of the telco and represents a significant opportunity to grow and differentiate themselves as key ecosystem enablers.

Connectivity is king, but telcos can offer so much more

Early in the pandemic Deloitte published a report Understanding COVID-19’s impact on the telecom sector. In this report, Deloitte highlights the various measures different telcos undertook for their customers as the Pandemic hit. These mainly related to increased data allowances, access to networking tools to allow work from home or supporting Governments by provided anonymised data to aid in tracking the spread of COVID-19.

Connectivity has played an increasingly important part in all our lives over the last year, from the reliability of Zoom calls to binge watching Tiger king, underlining the importance of the telco for all of us. 10 years ago these Telco’s spent billions rolling out 4G networks only to see the Over the Top (OTT) players like Google and Facebook usurp them, regulating them to ‘Dumb Pipe’ providers, their place in the value chain diminished.

As 5G proliferates, telcos are running the risk of history repeating itself. Larger enterprises have been eyeing up attractive private 5G networks, and DIY deployments that would once again demote the telco to ‘Dumb Pipe’ provider. It’s critical that the telco shake this stigma and become an integral player in the 5G value proposition if they are to generate 5G revenues from their $1trillion investment in the network.

Multi-partner ecosystems are growing in popularity as an opportunity for the co-creation of 5G services between telcos, enterprises, institutions and more. With 5G, telcos can unlock revenues in previously untapped vertical industries significantly expanding customer reach. Operating as part of an ecosystem does not require the telco to be a specialist in a specific vertical industry, but rather they must act as a master of orchestration, facilitating continuous service experimentation to create 5G services unique to dynamic customer requirements. As 5G stand-alone deployments continue, telcos can build quality of service into their specific 5G offers, increasing brand value not just in the eyes of their customers, but their partners as well.

We’ve reached an inflection point whereby telco leadership must be asking themselves, what they need to do to ensure they continue to grow their value and enhance their place in the communications value chain?  They need to consider key strategies like building cloud native networks, improved network reliability through automations, edge computing, and flexibility of service creation enabled by micro services.  The good news is that as they transition to 5G technology these are all areas which are addressed on that journey, it’s just up to them to decide how they go about adopting these technologies to enhance their value and grow beyond connectivity.


David-McGlew-HS3-150x150.jpgDavid is Marketing Director with Openet with 20+ years’ experience in the telco’s industry. Based in Dublin, Ireland David is a B2B marketing specialist, with particular expertise in Digital marketing, Demand Generation and Brand development.  Having spent many years develop and launching Mobile proposition for both consumers and Businesses he now helps Openet support such Telco’s to develop winning proposition for their customers. 

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