Dealing With Disruption: Improving MNO Agility
2016.11.22   |   28 pages   |   Operations and Management

Author:
Nicola Warren


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Most industries are at risk of digital disruption due to changes in consumer attitudes and behaviour and business practices brought about by the internet.  Telecommunications is particularly vulnerable due to the dynamics in the digital ecosystem which have reduced the barriers to industry participation that previously protected its core business.  They are also faced with the fact that connectivity is increasingly seen as a commodity.  Consumers are attaching less value to it – valuing instead the services that connectivity enables.  These trends threaten growth prospects for MNOs.

Operators are an essential part of the digital ecosystem and as such should be well-positioned to leverage their assets in response to digital disruption.  Yet many are not prepared for change.  This report considers the steps that could be taken to increase operator agility in the context of digital.

 

Companies: SK Telecom, Verizon, Tele2, Rogers, Orange, Singtel, SK Planet, Google, Facebook, Amazon,

Countries: Korea, USA, Sweden, Canada,

Keywords: product development, DevOps, 11st, start-ups, network effect, innovation, venture capital, customer value, partnerships, IoT, platform, collaboration, ROI, barriers to entry, innovation hub, NFV, agility, software defined networking, M2M, fail fast, acquisition, digital savviness, customer experience, asymmetric pricing, digital ecosystem, multi-sided platform, digital disruption, next commerce, virtualisation, continuous delivery, business model, scale, digital transformation, go90, SDN, continuous learning, over-the-top, OTT, return on investment,

1

Overview

1

2

Introduction

2

2.1

Background to the Report

2

2.2

Report Content

3

2.3

Currency and Conversions

4

2.4

Further Questions and Feedback

4

3

What Is Driving MNO Disruption?

5

3.1

Introduction

5

3.2

Consumer Factors

5

3.2.1

Universal Connectivity

5

3.2.2

Consumer Control over Products and Services

6

3.2.3

Personalisation

6

3.3

Digital Ecosystem Dynamics

6

3.3.1

Reduced Traditional Barriers to Entry

6

3.3.2

The Transience of Digital Value

7

3.3.3

Emergence of Digital Native Businesses

7

3.3.3.1

Start-ups

7

3.3.3.2

Large Internet Platforms

8

3.3.4

Alternative Business Models

8

3.3.4.1

Multi-sided Platforms

8

3.3.4.2

Asymmetric Pricing

8

3.3.4.3

Network Effects

9

4

Dealing with Disruption

10

4.1

Introduction

10

4.2

Recognise Digital Ecosystem Context

10

4.2.1

Foster Digital Savviness

10

4.2.2

Be Prepared to Disrupt

11

4.3

Use Data to Become Customer Centric

11

4.4

Innovate and Fail Fast

11

4.4.1

Simplify Product Development Processes

12

4.5

Ensure Operational Agility

13

4.6

Consider Alternative Business Models

14

4.7

Be Open to Acquisition and Partnerships

14

4.8

Expect Return on Investment Uncertainty

15

4.8.1

Innovation Hubs and Venture Capital Funds

15

5

MNO Responses to Digital Disruption

17

5.1

Tele2, Sweden

17

5.2

SK Telecom, Korea

20

5.3

Verizon, USA

23

6

Key Findings

26

7

Recommendations

28

 

Appendix – Feedback Questions

29

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