Over the next 10 years, advances in automation, analytics and AI (A3) are going to drastically change the way telcos manage their core businesses, how their businesses are organised, and the demands of their customers. We outline the core capabilities A3 capabilities telcos will need to remain competitive in their core business and to be effective ecosystem players over the next five to ten years.
Telcos must master automation, analytics and AI (A3) skills to remain competitive
A3 will permeate all aspects of telcos’ and their customers’ operations, improving efficiency, customer experience, and the speed of innovation. Therefore, whether a telecoms operator is focused on its core connectivity business, or seeking to build new value beyond connectivity, developing widespread understanding of value of A3 and disseminating fundamental automation and AI skills across the organisation should be a core strategic goal. Our surveys on industry priorities suggest that operators recognise this need, and automation and AI are correspondingly rising up the agenda.
Expected technology priority change by organisation type, May 2020
*Updated January 2021 survey results will be published soon. Source: STL Partners survey, 222 respondents.
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Key findings on operators’ A3 strategies
Based on deep dive interviews with 8 telcos, as well as insights from 8 more telcos gathered from previous research programmes.
- Less advanced telcos are creating a set of basic structures and procedures, as well as beginning to develop a single view of the customer
- Having a single version of the truth appears to be an ongoing issue for all – alongside continued work on data quality
- As full end-to-end automation is not a realistic goal for the next few years, interviewees were seeking to prioritise the right journeys to be automated in the short term
- Reskilling and education of staff was an area of importance for many but not all
- Just one company had less ambitious data-related aims due to the specialist nature of their services and smaller size of the company – saying that they worked with data on an as-needed basis and had no plans to develop dedicated data science headcount
Preparing for the future: There are four areas where A3 will impact telcos’ businesses
Source: Charlotte Patrick Consult, STL Partners
In this report we outline the skills and capabilities telcos will need in order to navigate these changes. We break out these skills into four layers:
- The basic skillset: What operators need to remain competitive over the short term
- The next 5 years: The skills virtually all telcos will need to build or acquire to remain competitive in the medium term (exceptions include small or specialist telcos, or those in less competitive markets)
- The next 10 years: The skills and organisational changes telcos will need to achieve within a 10 year timeframe to remain competitive in the long term
- Beyond connectivity (5–10 year horizon): This includes A3 skills that telcos will need to be successful strategic partners for customers and suppliers, and to thrive in ecosystem business models. These will be essential for telcos seeking to play a coordination role in IoT, edge, or industry ecosystems.
Table of contents
- Executive Summary
- Telcos’ current strategic direction
- Deep dive into 8 operator strategies
- Overview of 8 more operator strategies
- How A3 technologies are evolving
- Deep dive into 40 A3 applications that will impact telcos’ businesses
- Internal capabilities
- Customer requirements
- Technology changes
- Organisational change
- A timeline of telco A3 skills evolution
- The basic skillset
- The next 5 years
- The next 10 years
- Beyond connectivity