Better ARPU for Telco's
Telcos operators are challenged every day with new threats, like OTT platforms that are gaining ground and aiming at their customer base. Although these incumbents are getting some sort of relief with the slow introduction of 5G networks, they still have to fight if they want to keep their customers.
Infrastructure ownership and an already established customer base, which in turn is already subscribed to some of their services, are the two major factors that should be taken advantage of. This will enable them to offer IoT or smart home solutions bundled to an existing contract.
At first glance, there could be some issues like customer broadband access speeds, house typology, regulatory environment, privacy data and so forth, but when you think about it, these are minor hurdles. When customers agree to a contract with an operator, they can give access to everything the operator needs to have the system working in full force. Moreover, the benefits would very much surpass any kind of privacy violation, which is way below intrusion levels. Broadband speed is also an increasingly minor problem, as operators may provide the desired standards through their services, and in the near future, 5G will become as common as any other connection available now.
Getting back to the proposition at hand, in order to secure contract extensions from their existing customers or, in other words, to deploy a sort of lock-in strategy for the next 12 to 24 months, they have to offer an added value proposition in order to satisfy both sides. Besides convincing the top management, it is also needed to convince the customer paying for the service.
With that being said, when deploying their own IoT solution, the customers will enjoy multiple benefits, such as controlling electricity costs, gas or water bills, while at the same time improving their quality of life. Imagine the possibility of sending a monthly report with every bill, stating how much money the operator helped the customer save.
On a lighter note, but nonetheless curious, is the fact that, at this stage, people are able to remotely control any kind of smart appliances in their homes, such as leaving the office and turning on the AC at home, so that when they arrive, their homes are a bit colder or warmer depending on the given setting.
User satisfaction increases, because the customers are able to control gadgets and eventually understand their communication patterns while optimizing electricity consumption. As the market matures and reaches its full potential, it’s expected that existing services and devices, such as home security, automation or energy management will grow even further, getting more traction from customers.
But how can an Operator improve its reputation and retain customers in a scenario where brands are less valuable by the day? This is pretty much the answer, as it will give them a weapon to improve their perceived value at the same time they open additional revenue streams from big data collection.