Beyond connectivity: Telcos’ evolution into sustainability enablement


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This article is part of: Sustainability

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Results from our survey of over 200 enterprises found a growing interest for sustainability services. We outline actionable strategies telcos can employ to meet this demand and foster green revenue growth

Telco enablement services for enterprises

Fighting climate change has become a universal imperative across industries, and telcos and their partners are no exception. Many are committed to reducing their carbon footprints, with most having set net-zero goals between 2040 and 2050. Service providers less mature in sustainability are prioritising reduction of Scope 1 and Scope 2 emissions, while those further in their net-zero journeys are increasingly focused on Scope 3 emissions.

Scope 1 and Scope 2 emissions typically constitute less than 20% of telcos’ overall carbon footprint. Established methodologies exist for measuring and reporting these emissions accurately and they are commonly documented in company statements. However, the bulk of telcos’ carbon emissions stem from Scope 3, which encompasses emissions that a telco is indirectly responsible for, up and down its value chain. For example, emissions from the manufacturing of network equipment, or from customers’ use of products and services.

Telco service providers that are particularly advanced in sustainability are beginning to expand their focus beyond their own internal emissions and sustainability goals, towards developing enablement solutions to support their customers with achieving their sustainability goals. This signifies a shift in the focus of sustainability activities from risk management to innovation. This strategic shift surpasses goodwill and requires the adoption of new practices, governance, skills, and investments. It also leads to a deeper consideration of an emerging metric: Scope 4 emissions. See the graphic below.

Three scopes of emissions and the emerging voluntary metric, Scope 4

Source: STL Partners

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Scope 4 or “avoided emissions” are emission reductions that occur from the use of a product or service. For example, detergent manufacturers have introduced capsules that improve the performance of washing at lower temperatures. The use of these detergents means a reduction in the energy required to heat washing machines, resulting in reduced power and energy consumption. For a telco, an enablement service that reduces customer emissions could range from a core telecoms service being delivered in a more sustainable way, to a new service that is specifically developed and positioned to assist customers to track reduction of resource consumption.

The enablement opportunity is interesting to telcos as it provides a clear path to set themselves apart from competitors and tap into a potentially lucrative market for sustainable solutions. Telcos with robust service portfolios that effectively communicate the benefits to customers stand to greatly enhance their brand value. Conversely, telcos that fail to adapt their services risk losing market share as consumer and enterprise preferences shift towards more environmentally conscious options. Although there is currently no mandatory requirement for telcos to disclose Scope 4 emissions, the growing emphasis on corporate responsibility underscores the importance of proactively addressing environmental concerns.

The challenge lies in the competition for sustainable services, with telcos facing not only each other but also other solution providers keen to capitalise on the potential for new revenue growth. However, achieving this growth can be elusive. There is a lack of understanding across the industry of how to best capitalise on the enablement opportunity. Telcos must decipher what it is that enterprises require and desire, assess the revenue potential, and determine the most effective strategies to pursue. They also need to consider which enablement services offer the best return on investment and address internal challenges to develop these services cost effectively.

In this report we leverage insights from a global research programme (including telco and enterprise interviews and a survey of 200+ enterprises) to explore these questions:

  • What net-zero enablement services can telcos offer?
  • How can they tailor these services to different enterprise customers?

Table of Contents

  • Executive Summary
  • Introduction
  • Telcos’ enablement play is split across four categories of sustainability services
    • Many telcos already offer basic enablement services, but few offer services with a direct sustainability benefit
    • Telcos are not clearly communicating the benefits of enablement services which could hinder commercial success
  • Enterprise demand for sustainability
    • Attitudes towards sustainability differ between industries with low and high emission profiles
    • Enterprises have a positive view of telcos’ role in supporting their sustainability endeavours
  • Telcos must adapt enablement offerings to meet diverse enterprise sustainability strategies
  • The three key stages for telcos and ICT players developing enablement products and services
  • Appendix
    • Questions for respondents in Operations roles
    • Questions for respondents in Technology/IT roles
  • Index

Related research

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Miran Gilmore


Miran Gilmore

Senior Consultant

Miran Gilmore is a Consultant at STL Partners, specialising in edge computing and sustainability.