The potential of data management for telecommunications providers


Over time, telecommunications providers generate and store huge amounts of data due to their business and customer relationships. The already enormous volume of data continues to grow – and represents a major challenge in the management and security, and in particular the extraction of valuable information.

But today, data is the world's most valuable currency. Those companies that generate data as a by-product of their core business are able to turn that data into revenue using Big Data Analytics' rapidly evolving tools and techniques.

The telecommunications industry is at the center of a world that is increasingly changing as a result of intensive communication. The trick is to deal with the huge amounts of data and to gain valuable insights. According to International Data Corporation (IDC), unimaginable 33 zettabytes of data were generated from all sources in 2018, compared to 4.4 zettabytes just five years earlier. This corresponds to an average annual growth rate of 50 percent and is expected to grow to 175 zettabytes by 2025, more than five times that of 2018.

"These unimaginable amounts of data represent a vast body of information. For pessimists, this is only about whether and how these data can be saved and archived. Optimists see the potential for a privileged 360-degree view of the world, which in this way is available to the telecom industry just like few other industries, "said Markus Grau, Principal Systems Engineering at Pure Storage. "Meanwhile, customer data, device data, network and device usage data, and location data provide a nearly perfect map of what customers are doing and what they want. However, all of this data can not be meaningfully used without the tools and techniques of big data. "

Big Data for micro-segmentation

This privileged insight into customer data brings significant business value. Crucial here are the Big Data analytics tools and the increasing effectiveness of real-time data tools connected across all touchpoints. This allows telecommunications providers to work on service optimization, customer satisfaction and revenue growth. You can compare current data with legacy data to sell the right products and services to the right customers at the right time across all channels. These fundamental pillars of the customer experience are the cornerstone of value creation in the evolving, advanced data architectures used in the industry.

There is another aspect in this data mining story that is particularly intriguing: the importance of the detail, the role of the part as a whole. The data tools provide access to new data sources and new data types, including micro-cosms of information that provide new custom insights. These can help the telecommunications industry to evolve and increase sales. One possibility is, in particular, the avoidance of customer emigration, whereby the emigration rate currently amounts to 20 to 40 percent depending on the provider. Out-migration costs money, as it is expensive to replace customers who have fled with new customers. Data means that churn can be anticipated and prevented.

Herbert Blum, Partner at Bain & Company, is following a trend towards vertical specialization among the major telecommunications companies. "Every major carrier has opted for a vertical," says Blum. "AT & T is making smart homes, Telstra is aggressively targeting potential healthcare customers, Verizon is big on telematics, and so forth." The idea that drives this development is simple. The niche market is a focused area where vendors gain a competitive edge and build on it to differentiate themselves from a standard service all-round service provider. "They are strategically forced to do that, because if they do not, they will be left behind in the competition," says Blum.

Future-proof strategy

"Previously, customers had to go first, or at least threaten to leave their telecommunications provider to attract their attention. Thanks to real-time predictive analytics, today's providers are one step ahead of customer needs, "says Markus Gray of Pure Storage. "This big data advantage enables them to identify problems, derive action from them, and ensure that every single customer stays and is satisfied."

This shows the value of the data for telecommunications. Customers remain happy and loyal, the churn rate drops and sales remain stable. Other benefits include increasing ROI through real-time omnichannel communication with customers and vertical segmentation. The latter enables the industry to differentiate itself in expertise niches and to develop new business models. Big Data analytics is like a makeover for the burdensome traditional telecoms business and the foundation for an exciting future.

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