The domination of the internet harnessed through mobility, coupled with the proliferation of multiplatform/multiscreen content and increasingly smarter and powerful devices, continues to drive up customer’s experience and expectations.
The Internet and associated applications are now an integral part of everyday life, with everything becoming increasingly smart and connected. International Data Corporation (IDC) notes that the advent of ‘The Connected Economy’, with rapid diffusion of applications has fundamentally transformed how services are provisioned and delivered.
Our growing reliance on the Internet has shaped an environment that is conducive to fostering innovation by companies prepared to look beyond their conventional business models.
The impacts of digital disruption in many traditional industries like music and entertainment is that many well-established companies have vanished with digital upstarts challenging their once unshakable dominance. While no sector is immune to the digital phenomenon, the key issue is not whether companies need to make digital technology a strategic priority (that tipping point is now well past) but how they decide to embark upon the digital journey and turn it into a competitive advantage.
Those businesses that fail to realise that innovation, flexibility, and speed of execution are core to remaining afloat in a digital economy, will not survive the next wave of digital transformation.
Irrespective of their size and scale, from telecom operators to pure play Internet companies, success in the digital universe will depend upon their ability to identify and deliver a unique user experience and to achieve consistent customer engagement with their services. In addition, we believe that monetising unconventional business models and staying ahead of the competition, when the cost and time required for developing or replicating new services have both drastically reduced, will remain critical for success.
For telecom operators, digital transformation has become a crucial phase in their evolution, to the extent that they need to innovate and respond to changing consumer preferences with new business models; lest they perish or, at best, be limited to becoming a commoditised provider of low-cost bandwidth.
The availability of borderless interactive and innovative services is negatively impacting customer consumption patterns for core telecommunications services; consumers are increasingly giving up services like SMS and voice, in favour of experiencing richer digital services.
We see enormous potential to innovate in sectors like health care, governance, automotive, education, and retail, amongst others. For telecom operators, these possibilities translate into an opportunity to forward and backward integrate across the digital value chains. Nevertheless, telecom operators will need to acquire a central role, and “front-end” the sales channel in order to capitalise on digital opportunities.
These services are delivered over fixed and mobile networks, but telecom operators have little experience in developing, provisioning, and maintaining complex digital solutions independently.
Therefore, the success of telecom operators in the digital world will depend heavily on developing and maintaining partnerships as they compete with companies that were born out of the digital revolution. This would require them to carefully tread the path toward digital transformation with a clear strategy while simultaneously harnessing their strengths and mitigating the inherent challenges.
As citizens and residents, we should be enthused about the experiences and convenience that the digital future has to offer. Rest assured, the market will continue to experience innovations, which will inevitably contribute to gradual but definitive cultural changes. Learning from what has been happening around us, we can only imagine the enormous possibilities of the future as the impact of new technology goes further than its direct functionality.
It is also clear to IDC that new permutations of technologies such as “Smart Cities” are now beginning to reach the critical mass of innovation.
The possibilities across Smart Cities when combined with the “Internet-of-Things” (IoT) are endless, and will continue to usher in new services and deliver a level of convenience that was previously unheard of.
Furthermore, devices, appliances, and systems, which are increasingly becoming connected, also have an intelligence layer build into them. Such connected systems can access situations and trigger an event. For example, a connected car, home appliance, or preventive health monitoring system could trigger an alarm to the nearest available facilities in case of an emergency.
The rate of evolution in this connected universe is so overpowering that one may now even be tempted to think that we have reached the pinnacle of innovation, with nothing further left to explore. However, I would like to remind those with such beliefs that the digital transformation has just getting started.
The columnist is Group vice-president and Regional MD for the Middle East, Turkey and Africa at global ICT market intelligence and advisory firm, IDC.