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By Alberto Jessurun / September 15, 2021 / Blog

9 Ways Telecom Companies Need to Pivot in 2021

The world of communications is changing quickly. Telecom companies need to keep up by finding new technologies to create new products and business models to maintain revenue.

Key Takeaways

The economic situation of most telecom consumers has declined
Telecom companies can lead with original content but need to find innovative retention techniques
They need to diversify entertainment options, remix entertainment experiences, and explore non-traditional distribution opportunities.
Telecom companies also need to find ways to monetize advanced wireless networks, and in particular, they should develop applications for specific industries

The world of communication is changing quickly, and to stay relevant in this fast-changing environment, telecom companies need to innovate. These companies facilitate the sending of audio and video data around the world, and they include telephone operators, cable companies, satellite companies, internet service providers, and more.

Over the last 20 years, this industry has seen a lot of disruption and deregulation. While it used to be controlled by a few large companies, the industry now has a host of new players taking a variety of innovative approaches.

To maintain their revenue and safeguard their profit margins, telecom companies need to create new products and embrace new business models. All businesses face this imperative, but the situation is even more critical for telecom companies. To stay competitive, these companies need to pivot quickly. Here are nine strategies telecom companies should adopt in 2021.

1. Understanding the economic needs of consumers

The COVID-19 pandemic led to a decrease in income in nearly 40% of homes, and consumers who had their incomes reduced were more than twice as likely to cancel streaming services as people whose income stayed the same.

Telecom companies need to understand how their target market's income has changed, and they need to assess their prices to see where they can lower costs or add additional value.

Streaming companies, in particular, may want to pivot to ad-supported rather than subscription-supported content. The percentage of consumers who watch ad-supported content climbed from 18% to 47% during the pandemic.

2. Developing new content

Original content is the main reason customers select certain telecom and streaming services, but it is also the number one reason that they cancel their services. Streaming services need to continuously produce new content, but as this is cost-prohibitive, they also need to explore other strategies to retain their customers.

3. Focusing on customer retention

In 2020, the churn rate was 41%, while it was only 35% the previous year. Telecom companies that attract consumers through original content need to find effective ways to keep these consumers on board. That requires an extensive content library, algorithms that recommend the most compelling content based on consumer interest, and tiered pricing, so consumers only have to pay for what they want.

4. Diversifying entertainment options

Telecom companies that want to stay relevant should consider diversifying their entertainment options. In particular, they should jump on top of the increased interest in video games, music, and podcasts, and collect data to improve the customer experience with personalized recommendations.

5. Remixing entertainment experiences

Remixing entertainment experiences allows telecom companies to leverage consumer interest in an array of media experiences, and this doesn't just mean offering multiple types of media on a single platform.

Instead, telecom, media, and entertainment companies should try blending different types of media to engage audiences in innovative ways. A great example is the Travis Scott virtual concert in the video game Fortnite that attracted 27.7 million viewers. Similarly, Minecraft hosted a virtual music festival with 30 bands on three different stages (servers).

6. Exploring non-traditional distribution opportunities

Just as the concerts noted above were released in unique venues, some entertainment companies have also pivoted to nontraditional distribution methods. In particular, when movie theaters were shut down during the COVID pandemic, some studios began releasing films direct to consumers on streaming video services.

This strategy addressed the closure of movie theaters during the pandemic, but in the long term, this type of distribution shift can also help with declining ticket sales or other changes in consumer behavior.

7. Emphasizing different types of entertainment

In other cases, focusing on different types of entertainment may prove to be the right path forward. For instance, when sports stadiums closed during the pandemic, many consumers shifted their focus to e-sports. Some events drew well over a million viewers.

Noticing and capitalizing on these trends is essential for companies that want to be successful. The challenge, however, lies in being able to spot the difference between an enduring trend and one only created by the pandemic.

Companies need to invest in trends that will captivate audiences in the long run, but on the flip side, they don't want to pour capital into experiences that are merely a reaction to a temporary situation.

8. Monetizing advanced wireless networks

Telecom companies also need to embrace and monetize advanced wireless networks. Although 5G technology is widely available, it has not yet been thoroughly adopted by consumers or businesses. Businesses that find ways to harness this technology have the chance to obtain unprecedented, real-time visibility into their products and services.

9. Developing enterprise applications for specific industries

In particular, telecom companies should find ways to develop end-to-end enterprise applications that meet the specific needs of unique industries. The capabilities offered by 5G possess the ability to revolutionize every industry, but the growth will be driven by retail, government, and finance applications.

For example, in the retail industry, 5G technology coupled with edge computing can pave the way for smart shelves, cashierless shopping, digital signage that creates ads based on consumer demographics, dynamic pricing, and contactless shopping.

The key challenges for telecom companies are to deal with the economic challenges of their customers and find ways to attract and retain new consumers. Rising to these challenges is going to take a blend of improving the customer experience, blending or remixing entertainment options, embracing non-traditional distribution models, and monetizing new technology. Telecom companies that pivot to embrace these strategies will be poised to meet the challenges of 2021 and beyond.

Contact Unisol International to prepare for the future

We can help you prepare your company for the challenges of now and the future. At Unisol International, we help our clients find the technology they need, and we also offer project design, installation, set up, and more.

Is your business ready to meet the challenges of 2021 and beyond? We can help. To learn more about our products and services, contact us directly.

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