Insights Top performing operators continue to focus on both B2C and B2B markets to maximise growth potential

The B2B market provides many opportunities for telecom operators to diversify their offerings. Yet, as B2B may seem more profitable for most, recent market analysis has indicated B2C (4.8%) still out-performed B2B in terms of revenue growth for telecom operators in 2021.

As consumers continue to demand better speeds, availability and data allowances, it is tempting to ask where exactly operators should focus. The reality is that the top performing operators continue to focus on both B2C and B2B markets to capture the most opportunities in a post-pandemic world.

The success of the B2B market is not mutually exclusive from B2C, which currently leads the 5G market. A 2022 report by the GSMA on the Mobile Economy in Europe indicates 5G adoption across Europe will hit 44% in 2025, which lags behind South Korea, where 5G adoption is expected to hit 73% in 2025. By contrast in the UK, Ofcom recently reported in their Autumn 2022 report that 5G coverage (outdoor) by all operators was a mere 5-12%. Operators have a significant opportunity to exploit their B2C market strategies within the B2B market to support their 5G deployment and network modernisation strategy. Operators meanwhile face stiff competition from equipment manufacturers and cloud providers. Samsung recently announced its private 5G network offering in Korea, while Siemens has also announced the launch of their new private 5G network offering in 2023.

Operators are looking to capitalise on B2B opportunities for several reasons, chief among them being the growth rate and improved profit margins on offer as the convergence between telecommunications and IT continues. As highlighted by PWC, traditional business models like operations and business support systems are proving less viable as technology advances, with many operators yet to offer software-defined networking, network virtualisation functionality or system integration. On the other hand, hyperscalers and others are well-versed in exploiting the agile environment of B2B by offering services like redesigning network topology and migrating systems. It may be little surprise that a recent study also indicates that 81% of corporate respondents would prefer partnering with a cloud provider when establishing their private 5G network.

Operators and hyperscalers continue to evolve their strategy and solution set to adapt to digital business needs. According to Deloitte, to successfully capitalise on B2B opportunities operators need to better use data to digitise their operations, and modularise their solutions to include B2B services like unified communications, managed services and security services. Operators are partnering with hyperscalers to target B2B markets, like AT&T who partnered with Microsoft as it seeks to expand their private 5G edge network.

While operators seek new B2B revenue opportunities, the top performers are mindful to not forego their core bread and butter: B2C.

We frequently advise clients on potential legal, regulatory and commercial issues arising at the forefront of converging technologies in the telecoms sector. Get in touch if you’d like to have a further discussion about your project and we’d be delighted to assist.