By: Monica Ricci

Change is a constant in the communications business, so it’s helpful to track the trends that are influencing the evolution of the industry. CSG International is privileged to support the operations and business strategies of more than 500 telecom service providers and carriers around the world, and although each client’s business and operating environments are unique, we’ve seen a few common themes emerge over time. Here we outline a trio of trends that are at the top of our clients’ minds as they head into 2014.

Ripples widen as network evolution makes a splash

In 2013 we heard a lot of noise about the activity and associated investment in 4G LTE network rollouts to satisfy consumers’ demand for high-speed data. The year ahead will expose the broader impacts of next-generation networks on the communications business model. Like the proverbial pebble dropped into a pool of water, the ripples of network evolution will continue to have a wider and wider effect on CSPs, their operations and their future revenues and profit growth.

A key driver for 4G LTE evolution on the consumer side was declining voice revenues, but now CSPs have a similar need for speed. With big bets riding on the success of 4G LTE, providers must create new revenue streams and produce a rapid return on investment (ROI), not just increase traffic across the network.

The GSMA recently observed in a quarterly report that “customers that do use LTE services exhibit higher usage levels, prompting operators to develop innovative ways to monetize the increased data traffic and range of value-added services.” Among the innovative revenue streams being launched are charging based on quality of service (QoS), content bundled into application-specific charging plans, and the monetization of actionable intelligence through upselling and cross-selling via location- or usage-based parameters (think streaming move promotions on rainy days at home).

Of course, as 4G LTE initiatives and offerings expand, success will continue to breed new challenges for CSPs, including:

• Handling the massive increase in data volumes. Next-gen networks that support real-time streamed events produce roughly eight times the volume of traditional event records. Greater usage and more services create higher demands on networks and supporting systems to scale effectively and cost-efficiently.
• Generating and prioritizing revenue-producing traffic. Whether they’re creating QoS-based offers or intelligently offloading free traffic, CSPs must find ways to grow revenue in line with traffic growth.
• Managing complexity across traditional and emerging networks. From the plethora of network elements and types to the wide array of wholesale and content partners entering the mix, not to mention the new regulations regarding roaming, complexity will be a fact of life that CSPs will have to handle.
• Delivering a consistent and personalized customer experience. Putting customers in control of their experience with the speeds they want and the bundles they’ve selected, at affordable prices and with unique models to enhance their experience, is crucial.

These challenges will continue to affect internal systems and processes, so successful providers must ensure that their systems are flexible enough to support a rapid rollout of new services and business models without compromising revenue assurance or customer experience.