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Service Trumps Infrastructure as Broadband Becomes a Modern Enterprise Legacy telecoms must boldly go where no other telcos want to go. They have older technologies, cabling and exchanges plus the expensive commitment to provide services to rural areas and tiny populations. These communication service providers face a plethora of problems, from disruptive new entrants cherry-picking the most lucrative customers to cumbersome regulation. To live long and prosper, they must fight back by being as fit and fast as competitors and just as focused on the new expectations customers have for services, not just speeds. We need not look to the outer limits of the universe to see examples of this changing ecosystem. BT, for example, recently agreed to a change requested by UK telecom regulator Ofcom to a legal separation of its infrastructure division, Openreach. And that's only right, argue BT critics. After all, Openreach has 580 communication provider customers in the UK and the regulator demands it treat them all equally, rather than giving preferential treatment to BT.
BROADBAND WORLD FORUM: New perspectives. New connections. New location. See you in Berlin. But when politicians criticize slow rural broadband speeds, the only one of those 580 to get it in the neck is BT.
Hong Kong "We have done this by building our own fiber network to 80% of Hong Kong's households and then aggressively marketed the value of high-speed broadband. Our minimum speed is 100Mbit/s symmetric and our biggest seller is now 1Gbit/s symmetric," Gary McLaren, chief technology officer and co-owner, told UBB2020. Competition is good for customers and the economy, he said. Due to Hong Kong's many competitive service providers, the nation has some of the fastest residential broadband in the world, said McLaren. However, competition has its limits. "In all countries, you have parts where the population is concentrated and can support multiple competing carriers, parts that are natural monopolies (only one supplier is economic) and other parts where it is totally uneconomic to provide a service without a subsidy of some kind (either from government or from customers in the highly concentrated areas)," he noted. "In Hong Kong, we have built a network that services 80% of households. We are still expanding this, but it will never get to 100% coverage without some form of cross-subsidization. Even in Hong Kong there are villages and islands that are not economic for us to build to." However, legal and regulatory methods proposed to provide better services to uneconomic areas have proved highly illogical, said McLaren. Laws can generate more complexities, resulting in complaints and disputes as new content providers and legacy service providers find themselves governed by different rules, he said. Yet regulatory woes should not and cannot stop service providers from innovating, McLaren warned. "As we go forward we are looking to add extra revenue by bundling over-the-top (OTT) video content and mobile services with our core broadband services. Over the last two years we have struck partnerships with local TV companies and mobile virtual network operator deals with mobile carriers that enable us now to provide a complete quad play of high-speed broadband, mobile, video and basic telephony,” he said, noting these extra services increase the average revenue per user. Customers are willing to pay for improved content and services over ultra-broadband, said McLaren. "Traditional telcos are under threat from some of the same forces we are using to compete aggressively -- Netflix, Facebook and Google are providing compelling alternatives to consumers. We embrace this by connecting our network directly to these content sources," he said. "When customers get the content they want over high-quality high-speed broadband they are happier and do not see their broadband charge as a problem."
Israel "We have to provide our network on a wholesale model. We cannot just sell the same products as our competitors who can sell them cheaper," said Gil Rosen, chief marketing and information officer, in an interview. Bezeq created the Smart Lives strategy and segmented the market into three areas: Smart homes, smart business and smart cities. The CSP teamed up with sensor makers to provide a plethora of possible monitoring and control functions for homes, businesses and municipalities. The heat in Israel presents problems that lend themselves to IoT solutions. In homes, that may be controlling air conditioning, but in businesses it may be monitoring fridges and freezers, said Rosen. "A small coffee shop can easily have €10,000 of stock in a refrigerator and, if that fails for just two hours, their profit for a month could be wiped out,” he said. Bezeq is not just using existing sensors and technology but working in a "mini-consortium" with sensor makers to develop new services and uses, which it calls a "portfolio solution." Thus, instead of selling products, Bezeq sells a service, Rosen said. "Customers have moved up the value chain. Now we talk about the business and don't talk about the speed, the price or the service level agreement," said Rosen. "Instead, they tell us about their business, how much stock they have, when people come in and go out, what's important to them and what their problems are, and we offer a solution that is tailored to their need. It's a more mature relationship, not based on infrastructure." Some staff at one retail store were stealing and the small store could not determine when the cash register was open. The retailer wanted a sensor in the till to alert the DVR when the register was open so it was faster and easier to skip through the video footage to each time cash was exposed, Rosen said. Bezeq integrated home IoT into a simplified smart dashboard and made it function on the Apple Watch. In businesses, the smart dashboard can monitor carbon dioxide levels, noise, temperatures, cameras, WiFi and DVRs, he said. And Bezeq's sensor tracks vital equipment to prevent it being moved out of target areas, said Rosen. It even has IoT tracking in coffee barista machines, which many criminals find attractive, he added. This all comes in addition to Bezeq's cloud and cyber services for businesses, as well as growing demand for its built-in cybersecurity system for homes, protecting customers from cyber attacks and their IoT devices being accessed by the wrong people, said Rosen. "You can see who connects to WiFi, when and the bandwidth they use. And you can disconnect the WiFi to a child who should be doing their homework," he said.
Service economy In 2014, less than a decade after selling mobile operator O2 to Telefonica, BT announced it was interested in buying it back, only to settle on buying rival EE. It now says consumer revenue is growing and the revenues of EE are starting to grow. Where BT still has to up its game is customer service, although it described an upturn. "Churn could be lower, but high levels of churn are a function of the very competitive market where customers can switch providers easily. We're investing heavily in customer service to improve the customer experience," BT reported in a statement. "EE has a very low level of churn at 1% a quarter, which indicates EE is doing a good job on customer loyalty. Steps to improve customer service will help our market share." Service is the theme running through the industry’s success stories. While competition reduced prices, this cost-cutting sometimes eroded service standards. The lesson from the past is that quality service will be the key to the future. Related posts:
— Chris Wheal is a freelance business and technology journalist. (Home page image source: Purple Slog/Flickr CC by 2.0)
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The 2020 Summer Olympics in Japan will be one of the first large-scale deployments of 5G, but misinformation could delay other organizations' implementations – unless operators educate potential customers about 5G's many real capabilities.
Metropolis' approaches to digitization may differ, but two things are clear regardless of geography: Data and service providers play a critical role in smart cities' success. That's the lesson cities like Cali, Colombia and other urban areas are learning.
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Wednesday, September 14, 2022
1:00 p.m. New York / 6:00 p.m. London When your broadband business adds new services and connected devices, do they also add complexity, slowing customer support teams as they navigate multiple data sources to uncover connectivity issues? We’ve worked with hundreds of support teams to help them implement a subscriber experience management platform that gives greater visibility into subscriber issues. They can proactively troubleshoot amid complexity—improving the subscriber experience and raising customer satisfaction ratings like Net Promoter Scores. Join this webinar with experts from Calix and global research leader Omdia who will share exclusive research about how you can:
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