Launched 28th January 2014, the Telco 2.0 Transformation Index, (The Telco 2.0 Intiative’s new comprehensive business model transformation benchmark of leading global communication service providers) shows that changes are underway at AT&T, Ooredoo, SingTel, Telefonica and Verizon but no player is yet doing enough to ensure a successful transition to a sustainable new ‘Telco 2.0’ business model.

 

Results from the Telco 2.0 Transformation Index show that SingTel and Telefonica lead the way in transforming themselves from engineering-led infrastructure businesses to innovation-led platform and production innovation players. A key driver of this has been in the bold efforts they have made to change their organisation structure and processes to support new services and customers via independent ‘digital’ business units.  The US giants – AT&T and Verizon – and the Middle Eastern CSP, Ooredoo, also covered in the first tranche of analysis, are at an earlier stage of the transformation journey.

 

STL Partners believes that all CSPs should be aiming to score 75% or more on the Telco 2.0 Transformation Index to give themselves a good chance of enjoying successful growth in the future. However, even SingTel (scoring 60%) and Telefonica (scoring 57%) deemed to be leaders in this space are progressing too slowly.

 

The Index consists of detailed analysis of individual communication service providers (CSPs) across 5 ‘domains’ – Marketplace, Servicing Offerings, Value Network (internal organisation and external partnerships), Technology and Finance.  Quantitative and qualitative analysis has been conducted over 7 months by STL Partners’ analysts to determine the strengths and weaknesses of each CSP in each domain.  Objective scores for each CSP in each domain are then calculated so valid comparisons can be made independent of geographic region and company strategy.

 

According to Chris Barraclough, Telco 2.0’s Chief Strategist, “Our analysis suggests there is a potential uplift to share prices of 45+% for CSPs that can transform from being pure ‘infrastructure players’ to platform and production innovation companies. However, such a transformation is challenging.  It is not simply about CSPs launching and handful of ‘digital services’.  Transformation needs to be company-wide covering both ‘hard’ factors, such as organisation structures and business metrics, but also ‘soft’ ones, including business processes, partnerships and culture.  The Telco 2.0 Transformation Index covers all this in depth and provides strategic guidance on the process of change in the telecoms industry.”

 

“The leaders – SingTel and Telefonica – are working hard to get their organisations in shape for the new digital world. However, to date, changes at CSPs have not yet yielded material additional value in the form of great new services and new customer relationships.  It is clear that more needs to be done by all CSPs if the industry is going to avoid substantial value destruction over the next 5 years.”

 

Website Link: http://www.telco2research.com/categories/telco_2_transformation_index

 

Contact: Hayley Brace. +44 (0) 207 247 5003. Email: [email protected]