The Future of the Communications Industry

Long talked about, convergence is now an accurate description of the current business model of the communications services industry. Carriers, software companies, high-tech firms, media enterprises, entertainment conglomerates—all may find themselves collaborating and partnering one day and competing against each other the next.

How do these different convergent players view the future of the telecommunications industry and their own place in that industry in light of the increasingly complicated relationship they have with each other? This was the dominant question behind this research study.

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Learn more about Accenture Research for the Communications Industry

In association with an independent research company, Accenture conducted a qualitative research study exploring the competitive future of the communications industry over the next decade.

The key objectives of the research were to determine the most important strategic issues that the telecommunications industry will need to address over the next decade, and to understand how carriers view their competitive capabilities in comparison to how they are viewed by their partners and collaborators from the software, high-tech and media/content industries.

Several technology and content company executives point to a number of potential weaknesses in the carriers' current approach: lack of a powerful vision for managing the customer experience, some softness in overall brand value, and an inadequate support structure for planning and managing the collaborative and partnering relationships necessary to spur innovation and improve time to market.

The executives with whom we spoke affirmed this era of the communications industry as exhilarating in its possibilities. Competition will be fierce; few, if any, companies operating in this broad ecosystem of digital services will look quite the same in 10 years as they look today. It is likely that significant mergers, acquisitions and alliances are on the horizon that will change the terms of the playing field in dramatic ways.

Several key themes emerged from the research that help to illuminate the way forward for carriers and others operating in, or hoping to join, the ecosystem:

• Carriers are confident, but their vision may be insufficiently transformative
  
  
• Seamless delivery of content across multiple platforms will be crucial
  
  
• Other players are looking to leverage the distinctive strengths of service providers
  
  
• Carriers must learn to use their brand in the right way
  
  
• Support for open innovation and collaboration is critical to achieving high performance

Carriers have traditionally seen themselves in charge of the entire user experience of their customers. The new world will not be one dominated by any one company. The value chain is in flux. Carriers can continue to fight that trend by building walled gardens, but that strategy now looks more and more questionable. As the industry becomes more complex and involves more players, carriers must take a more collaborative approach.

What can unite the different players at this time of hypercompetition is ultimately the customer. Convergence as a technological phenomenon has happened and will continue to intensify. What has yet to happen, however, is for all the players to converge themselves on the customer experience— delivering a compelling user experience that is easy to understand and simple to use.

Communications service providers that find their rightful place in the overall value chain, and that can remain agile enough to serve customers' needs in a way customers can readily understand, are the ones more likely to achieve and sustain high performance.