Telcos risk missing out on enterprise opportunities worth trillions

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New research finds that 97% of global enterprises are willing to buy ICT services from operators, but telcos’ ability to capitalise on this is less clear cut.

Consultancy BearingPoint, which carried out the research, called for immediate action from telcos on investment priorities, innovation and partner ecosystems, noting that the enterprise market for telcos is estimated to be $3.6 trillion (€3.17 trillion) by 2022, according to Gartner.

BearingPoint’s research found that 47% of 100 operator executives expect the enterprise segment to be their organisation's primary revenue source in two to three years, but only 31% expect this segment to be their main focus for investment.

Bureaucracy

The findings also highlighted the risks of bureaucracy and legacy systems limiting innovation. Four in ten (39%) of the 250 enterprises surveyed highlighted challenges around innovation and the relevance of solutions when they had worked with telcos in the past.

Only 26% of enterprises see CSPs as a key partner for new and innovative ICT services today. When asked how CSPs can become preferred IT partners, the most popular enterprise response was for CSPs to collaborate with other vendors to provide complete, “joined-up” solutions.

On the topic of partnerships, 86% of telcos said they recognise that third-party collaboration is important. However, just 12% have ecosystems in place today and only 33% are "fully engaged" in developing high-quality partnerships

More than half (54%) of telcos admitted their current IT systems do not support seamless orchestration and settlement within a partner ecosystem.

Half (51%) of enterprises regard companies such as Google and AWS as key sources of products and services. However, only 32% of CSPs currently partner with these players, and only 37% expect to do so in two years.\\

Tough decisions

Angus Ward, CEO BearingPoint//Beyond, said: “Enterprise IT spending is huge, growing fast, and one of the last untapped growth engines for communications service providers (CSPs) in saturated markets.

“Enterprise will be pivotal to 5G and IoT. The research makes for positive reading in the main – there is an obvious opportunity for CSPs to capitalise on - but there are obstacles they must overcome. Among them, they must prioritise investment in enterprise, junk overly bureaucratic legacy processes and policies that slow them down and commit to understanding and engaging with enterprise customers differently.”

“Critically, CSPs must act quickly,” he added. “If not, they stand to lose out to more agile and open competitors.”

Download the report: Mind the gaps: six reasons why CSPs could miss out on the multi-trillion-dollar enterprise IT opportunity