Building Better Business Services – Becoming a Business BFF

By | June 13, 2018

Underlying all the tech talk about 5G, NFV/SDN, analytics and machine learning is some serious concern about services and monetization. Basically, this digital transformation stuff is expensive and given that consumers aren’t going to pay a lot more for digital capacity, how are operators going to make money?
I would never minimize the importance of network evolution, but networks don’t make money – services do. And before long B2B and B2B2x services could easily become more lucrative than consumer retail services. And at the recent TM Forum event in Nice, operators were starting to agree.

In the first ICT Intuition enterprise research study in 2015, we found that two-thirds of businesses want to buy digital services from network operators that are integrated from the application to the core of the network (B2B) because of their reputation for performance, reliability and security – security being the top purchasing criteria. In addition, 95% of businesses want to go to market with operators to sell connected services (B2B2x). We’ve also said that operators aren’t offering much more than secure connections and capacity – the same old speeds and feeds over a new network.

Based on recent ICT Intuition research, revenue from business customers hasn’t budged because operators aren’t offering businesses what they want to become digital enterprises or what they need to offer digital services to their customers. Which leaves operators with two significant revenue opportunities that aren’t being fully taken advantage of.

Business services are different in a number of ways. On the plus side, business customers are less price sensitive and less likely to change providers based on promotions or discounting. On the cost side, business services are more expensive to deliver and manage because each is relatively unique and there are typically fairly extensive service level agreements that must be maintained. Yet, businesses are willing to pay a premium for those things as long as an operator can deliver the whole, integrated enchilada.

Any business smaller than a multi-billion-dollar enterprise that has its own large, skilled staffs of IT and network engineers and specialists wants to buy a service. Period. No configuring, no administration, no monitoring or management. Just a predictable monthly fee that gives employees access to the applications they need wherever they are using any type of device. Given the shortage of qualified workers in many technical fields, businesses are more than willing to pay for a turn-key service rather than trying to build and maintain something on their own. As a result, more and more technology budgets are being allocated outside of IT.

As operators, it’s time to look at what is being offered to businesses. Are you meeting the needs of businesses that are outsourcing their technology requirements and purchasing integrated services? Are you getting your share of the enterprise technology budget? Could you get more? Are the pieces in place to construct unique business service offerings using common catalog elements? Are you putting systems in place that enable economic delivery and management of secure, multi-tenant business services? Can you operate all of that? Can you bill for it?

Consumer network services are commoditized. While some operators are trying to capture a portion of the consumer content market, much has already been lost to over-the-top providers. Businesses, however, continue to trust network operators to deliver what they need and as skills shortages become even more acute, outsourcing IT becomes that much more attractive. While operators remain the preferred provider, that advantage won’t last.