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Telcos must adapt to withstand stiff competition

MOBILE network subscribersJOHANNESBURG, (CAJ News) – AS competition continues to increase in Africa’s telecommunications and information technology markets, the need to attract and retain customers through differentiation has become imperative, an expert has said.
According to George Kalebaila, research director for telecommunications, media, and IoT at International Data Corporation (IDC), this means telcos must move beyond traditional connectivity offerings and provide IT services such as unified communications and collaboration, cloud, and datacenter services.
His sentiments come as increasing levels of competition forces mobile telecommunication companies to seek new methods to stem the steady decline of traditional voice services.
The companies are thus increasingly focusing on effectively maximizing their return on investment from data and on monetizing emerging opportunities such as the Internet of Things (IoT) to remain competitive and afloat.
IDC forecasts greater market consolidation as telcos increase their efforts to acquire smaller internet service providers in response to the challenging marketing conditions.
“This is particularly in West Africa, being driven by heightened market saturation, declining average revenues per user (ARPUs), increasing operating expenditure, and diminishing profit margins on services,” said Kalebaila.
“As such, IDC expects some consolidation within the market, especially between local ISPs that possess 4G LTE frequencies and fibre-to-the-x (FTTX) infrastructure and multinational telcos with solid financial support.”
In markets where 4G adoption is already gaining traction, discussions around fifth-generation network technology (5G) will take centre stage, creating awareness and bringing the possibilities and expectations of future data networks to the forefront, said Kalebaila.
“IDC expects vendors to focus on the higher bandwidth 5G offers and the technology’s potential ability to support emerging services such as IoT, seamless video on demand or IPTV, drone video recording, smart city solutions, and virtual reality applications.”
In 2017, telcos are also expected to focus more on 4G monetization strategies such as enhanced data offerings, service bundling, and partnerships with digital media companies from a content perspective.
While the deployment of 4G networks is already gaining traction across Africa, spectrum availability, low customer awareness, low coverage, high tariffs, and the cost of 4G smartphone devices remain key challenges.
Telcos need to identify key challenges, prioritize the development of unique digital transformation strategies and implement a phased approach to digital transformation.
“Understanding and tracking customer behavior will also help telcos provide personalized and optimized offerings to their subscribers, and therefore help enhance customer loyalty,” Kalebaila concluded.

CAJ News

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