Industry Thought Leadership

The increasingly tough competition in a saturated B2C market and the impact of OTT services have put CSPs’ growth strategies under pressure. To create and capture new revenue streams, telecom operators are steadily shifting focus from the consumer segment to the business segment by creating enterprise-centric service portfolios. According to TM Forum, modern CSPs receive about 90% of their revenue from B2C, but in the next 5-10 years, more than 75% expect to get nearly half of their revenue from B2B. Moreover, B2B is an immense opportunity in the 5G era, with a raft of digital transformation projects underway across industries. From mission-critical network support to securing data exchange between connected devices, 5G is expected to sustain various use cases within the B2B market.

In the Middle East, Allied Market Research estimates that the value of 5G B2B activity will reach $297 million by 2028. To fully exploit these opportunities and monetize 5G investment, MENA telecom leaders are investing in new capabilities, with edge computing being a priority. This trend ties in with operators’ efforts to grow revenues beyond core telecom services. To succeed in this market, however, it is necessary to overcome a number of challenges.

B2B Consolidation: Primary Challenges
First, many CSPs resist changing their traditional B2B business model based on centralized control and low business agility. Modern B2B customers have high expectations and want to get the same experience as the B2C segment. Among other things, they require frictionless customer services, fast responses, and personalized offerings based on their unique needs. Besides, 5G business clients need automated low-latency services able to process high volumes of data without delay.

Second, CSPs lack a comprehensive convergent billing environment capable of handling the complex B2B offering and covering all available products, including partner products, and technologies. Software currently used to bill and invoice complex B2B products and services lacks high-quality automated billing solutions, and a lot of the tasks are manual. Hence, B2B customers receive multiple bills for several products from the same operator and face discrepancies between product fulfillment and product invoicing.

Third, 5G technologies are expected to increase the complexity of B2B dedicated products and services, but many operators are still not ready to handle them effectively. For example, in the MENA region, 5G monetization is still in the early stage: the existing primary 5G offerings include fixed wireless access and EMBB aimed mainly at residential users. At the same time, the B2B offering remains weak, and improving it requires time and resources to address the whole 5G enterprise segment and implement changes on CSPs’ side.

Strategies to Advance B2B for Revenue Growth
Improving B2B for revenue growth requires focusing on three primary aspects: end-to-end B2B solutions, long-term partnerships, and B2B2X offering.

First, CSPs should advance the total experience provided to their B2B segment by simplifying and automating processes used for delivering services to businesses. They should act as digital service providers by offering end-to-end B2B solutions that include infrastructure services and digital platforms. Moreover, CSPs will need to ease and speed up the order processing for B2B clients and ensure the absence of any errors during the sales procedure. It is also necessary to provide appropriate reactivity and complete transparency in the after-sales processes, such as dedicated customer care, transparent billing, and invoicing and collection processes.

Besides, the total end-to-end experience provided to B2B clients can be advanced with Multi-access Edge Computing (MEC), a type of network architecture employing cloud computing and an IT service environment at the network’s edge. MEC transfers mobile network processing functions from a centralized location to diverse distribution points and helps decrease latency and expand the range of applications and services delivered to B2B clients. Along with 5G, MEC contributes to the digital transformation of CSPs, generates new revenue opportunities, and creates competitive advantages.

Second, another essential telco revenue growth factor is building the right partnerships and valuable partner ecosystems. Partnering with the proper entities and having the capability to integrate new partners easily, quickly, and smoothly will allow CSPs to offer specific B2B services based on unique market demands.

The right partner ecosystem is especially valuable for 5G monetization. For instance, having the right partner with advanced knowledge of the specific business or industrial sector helps successfully implement private 5G networks, such as in industrial sites and airports, in order to expand existing business capabilities and provide businesses with new services and functions unavailable in other systems. In this case, CSPs would act as service enablers handling systems integration, platforms, and data management. These offerings could be interesting for the Middle East, where power and manufacturing enterprises are looking for their own wireless infrastructure. In particular, Allied Market Research predicts that the Middle East market for private networks (including hybrid networks) will reach $144 million by 2028.

Most significantly, private 5G networks have already proven their effectiveness for businesses requiring high reliability and low latency of services, such as smart factories and smart manufacturing. 5G-enabled technologies’ use cases are especially impactful in projects related to predictive maintenance, digital twins, self-driving machines, augmented reality, autonomous mobile robots, and others. For example, Ford utilizes 5G to improve communication, safety of the manufacturing process, and quality of products and services. With the help of 5G, the company has successfully reduced delays, achieved wider bandwidth, and improved security and reliability at its factory.

AR running on 5G networks could also enable on-site workers to conduct maintenance, repair, and operations supplies safely. For instance, Schneider Electric’s Le Vaudreuil Factory has successfully tested 5G for an AR application that enables operators to superimpose real-time data and virtual objects onto cabinets, machines, or an entire plant. Ultimately, more devices will get connected, the 5G ecosystem will evolve, and costs for deployment will decrease, so private 5G networks could become an increasingly desirable choice for smaller manufacturers and businesses of all sizes.

Finally, CSPs should adopt a broader perspective on future-proof capabilities that will empower them to harmonize revenues from any use case. Therefore, Nexign has introduced a new cloud-native, microservices-based solution designed to help operators consolidate all revenue sources on a single convergent platform. Nexign Revenue Management lets CSPs get unlimited flexibility to capitalize on emerging monetization models and services beyond connectivity while balancing operational efficiency in the increasingly complex environment. It also covers the entire revenue management process and is ready to work with any telecom services, digital subscriptions, or third-party products and bundles.

Positioning Telcos for the B2B Future
During the last few years, B2C data are being considered as a commodity with declining revenues due to the high competitiveness among CSPs and the steadily shrinking international voice market. It has become clear that the B2B market is the only high potential market for telcos. To thrive in this market, CSPs should develop an efficient and focused B2B investment strategy and new offering schemes with innovative, competitive, and personalized products and enhanced business support system environments.

At this stage of 5G deployment, with stand-alone networks emerging throughout the region, CSPs could provide industry-defining services and capitalize on enabling enterprises to harness such network capabilities quickly and easily. The more businesses see value and monetization opportunities in 5G, the more telecom operators benefit from these services.