Beyond the horizon: Could B2B services and cross-industry collaboration define telecom’s next big move?

At present, we find ourselves in the midst of a new transformative era, driven by the convergence of cutting-edge technologies like 5G, edge computing, and Generative AI. These innovations are enhancing traditional connectivity and opening major new avenues for cross-industry collaboration. For telecom operators, particularly in the B2B sector, this can be pivotal to reinventing their operating models, expanding service offerings, and driving substantial value for their enterprise customers.

In this post, we explore the technology aspects of this transformation, highlighting the scope for telecom operators in the enterprise B2B segment, with an acknowledgment of the significant opportunities in the SMB market as well.

The imperative for cross-industry collaboration

In the rapidly evolving digital landscape, the duality of communications service providers’ (CSP) challenges remains. First, there is an ever-evolving need to innovate and adapt to a fast-moving market. This includes transforming into a “digital telco” that offers a unified customer experience. Second, the age-old pressure for cost containment, agility, and faster time-to-market has become more intensified. Legacy systems and traditional siloed architectures, further compounded by recurring M&A in the sector, continues to create significant bottlenecks, limiting agility and increasing costs.

While the imperative for cross-industry collaboration is clear, it’s important to note the disparity in B2B industry maturity between developed and developing telecom markets. In developing markets, telecom operators often face additional challenges such as less robust infrastructure, regulatory hurdles, and a different competitive landscape. These factors can impact the speed and effectiveness of cross-industry collaborations. However, these markets also present unique opportunities for innovation and growth, particularly in sectors like fintech, e-commerce, and agriculture.

The solution lies in embracing cross-industry collaboration. By leveraging partnerships beyond traditional telecom boundaries, operators can unlock new revenue streams and deliver more comprehensive solutions. For instance, integrating telecom services with IoT, smart cities, and digital health solutions can create enhanced service offerings that meet diverse customer needs.

B2B: The growth driver for telecom

B2B is emerging as the primary growth driver for telecom operators. Unlike the saturated consumer market, the enterprise segment holds substantial opportunities for revenue expansion and business diversification. Businesses are increasingly seeking advanced connectivity solutions to support their digital transformation initiatives, and telecom operators are uniquely positioned to fulfill this demand.

Drivers of this change include:

• Increased demand for connectivity: Enterprises need robust connectivity solutions to support remote work, digital collaboration, and cloud-based services.
• Custom solutions: B2B customers often require tailored solutions that address specific industry challenges, creating opportunities for telecom operators to offer bespoke services.
• Higher revenue potential: B2B contracts typically involve higher-value deals and longer-term commitments compared to consumer subscriptions.

Additionally, the SMB segment presents significant opportunities, particularly for bundled solutions like IT-in-a-box, as well as addressing challenges in cyber, data, and network security.

Telecom operators in developing markets specifically have a significant opportunity to drive growth through B2B offerings. The SMB segment, in particular, is ripe for digital transformation solutions that address their unique challenges. As operators focus on providing tailored solutions, the emphasis must be on creating scalable, cost-effective packages that can help small businesses leverage digital tools for growth and competitiveness.

5G: The catalyst for innovation

5G technology is at the forefront of this transformation. With its high-speed, low-latency capabilities, 5G is not just about faster mobile internet—it’s about enabling entirely new business models and applications. For B2B customers, 5G facilitates real-time data processing and decision-making at unprecedented scales.

• Smart manufacturing: 5G enables seamless connectivity and automation in manufacturing, allowing for real-time monitoring and control of production processes.
• Telemedicine: High-speed connectivity supports advanced telemedicine applications, including remote surgeries and real-time patient monitoring.
• Automated logistics: 5G-powered IoT devices enhance supply chain efficiency through real-time tracking and automation.

Communications service providers like Verizon and AT&T are already deploying 5G solutions for enterprise customers, enabling smart factory initiatives and enhancing logistics operations with real-time tracking.

Edge computing: Bringing intelligence closer

Edge computing complements 5G by processing data closer to the source, reducing latency and bandwidth usage. This is particularly crucial for applications that require immediate processing and action.

Benefits of edge computing include:

• Enhanced security: By processing data locally, edge computing reduces the risk of data breaches and enhances security.
• Optimized performance: Local data processing ensures faster response times, which is critical for applications like autonomous vehicles and industrial automation.
• Scalability: Edge computing enables scalable solutions, accommodating growing data volumes and diverse application needs.

Companies like Ericsson are pioneering edge computing solutions that empower businesses to deploy applications closer to their customers, optimizing performance and enhancing security.

Generative AI: Transforming operations and customer engagement

Generative AI is revolutionizing how telecom operators interact with their customers and manage their operations. This AI technology can create new content, automate complex processes, and provide personalized experiences.

However, when considering this technology, it’s important to distinguish between the simplification and automation of the CSP’s own operations and the growth opportunities available with B2B customers.

Internal CSP optimization:

• Customer service: AI-driven chatbots and virtual assistants can handle a wide range of customer inquiries, providing instant and accurate responses.
• Network optimization: Generative AI can predict network issues before they occur, allowing for proactive maintenance and reducing downtime.
• Content creation: AI can generate personalized content for marketing and customer engagement, enhancing customer loyalty and satisfaction.

Growth opportunities with B2B customers:

• GPUaaS/AI factory: Telecom operators can offer GPU-as-a-Service and AI factory solutions, as demonstrated by companies like FastWeb and Telenor, enabling businesses to leverage AI capabilities without significant infrastructure investments.
• AI-driven insights: Providing AI-powered analytics and insights can help businesses optimize their operations, predict market trends, and enhance decision-making processes.

The success of these B2B aspirations is contingent on the robustness of the foundational service layer. Generative AI and other advanced technologies can only deliver their full potential if the underlying telecom services are reliable and efficient. This is especially crucial in developing markets, where service reliability can be a major differentiator. Ensuring that foundational services are robust will enable Communication Service providers (CSPs) to offer advanced AI-driven solutions with confidence.

Industry Insight: Karl Bjurstrom Global Head of Tech & Telecom Industries Capgemini Invent

“AI and especially Gen AI offer a very interesting opportunity for CSPs. If they can unlock the tremendous amount of data they have at their fingertips, they could not only drive productivity improvements for their own business, but also build AI use case / model factories to offer secure Gen AI model training grounds for large public organizations and B2B customers. As the use of AI scales, the needs around cybersecurity and network security solutions contributing to full stack observability, are increasing. I think that’s an interesting opportunity for CSPs in the B2B space.”

A futuristic outlook for telecom

The integration of 5G, edge computing, and Generative AI is reshaping the telecom landscape, particularly in the B2B sector. As telecom operators embrace these technologies, they must also foster a culture of innovation and collaboration. This involves investing in new skills, adopting agile methodologies, and leveraging open standards like TM Forum APIs and open digital architecture (ODA) for seamless integration.

Looking ahead, the future of telecom B2B will be characterized by:

• Hyper-personalization: Tailoring services to meet the unique needs of each customer through advanced analytics and AI.
• Sustainable operations: Leveraging energy-efficient technologies and practices to minimize environmental impact.
• Innovative partnerships: Forming strategic alliances across industries to co-create value and drive innovation.

Approach for capitalizing on B2B opportunities

To capitalize on B2B opportunities, CSPs should adopt a customer-centric approach, focusing on understanding the unique needs of their enterprise clients. Key prerequisites include a robust digital infrastructure, advanced analytics capabilities, and a flexible, modular IT architecture. Enablers such as TMF APIs and ODA standards facilitate seamless integration and interoperability, allowing CSPs to offer customized solutions rapidly.

CSPs should also prioritize building strong ecosystem partnerships to extend their service offerings and co-create value. Investing in talent development to acquire new skills and adopting agile methodologies will enhance innovation and adaptability. By leveraging these strategies, telecom operators can position themselves as indispensable partners in their clients’ digital transformation journeys, driving sustained growth and competitive advantage.

In developing markets, CSPs should prioritize building a strong foundational service infrastructure to support their B2B offerings. This includes investing in network reliability, customer support, and regulatory compliance. Additionally, the trend towards bundling advanced services like AI and IoT with foundational connectivity ensures that businesses receive comprehensive, dependable solutions. By guaranteeing the quality of their core services, CSPs can confidently layer on advanced technologies, ensuring customer satisfaction and fostering long-term partnerships.

Industry Insight: Bala Balakrishnan, Chief Commercial and Product Officer Business, Liberty Latin America

“Innovation in communication, computing, and AI, including advancements in 5G, IoT, edge computing, and AI, present significant transformative opportunities for businesses worldwide. This wave of innovation is reshaping established business models and opening new avenues for growth within various sectors. CSPs play a pivotal role in this transformation as primary connectivity providers through their broadband and wireless networks. Embracing these technologies and leading the charge in transformation for their clients represents a crucial growth opportunity for CSPs. Operators who innovate and empower their customers to leverage these advancements will distinguish themselves in their markets and achieve success”

Paving the way to a new era of connectivity and collaboration

Telecom’s B2B future lies in the seamless integration of 5G, edge computing, and Generative AI. These technologies not only address current challenges but also pave the way for unprecedented opportunities in cross-industry collaboration. By embracing this transformative journey, telecom operators can deliver exceptional value to their enterprise customers, driving growth and staying ahead in a competitive market.

As the digital telco of tomorrow, the focus must remain on agility, innovation, and customer-centricity. With the right strategies and partnerships, the telecom industry is poised to lead the way into a new era of connectivity and collaboration. B2B will be at the heart of this transformation, driving growth and innovation in the telecom sector.

TelcoInsights is a series of posts about the latest trends and opportunities in the telecommunications industry – powered by a community of global industry experts and thought leaders.