RESEARCH REPORT

In brief

In brief

  • Accenture’s research indicates by adopting key digital technologies in the telecommunications sector, can add tremendous value for South Africa.
  • This paper provides a map of where the greatest pockets of value are, how to unlock them and the role each stakeholder must play.
  • Better telecommunication services will benefit wellbeing of citizens and support economic development and growth.


In South Africa, telecommunications plays a vital supporting role in socio-economic development, as well as digital advancement of industries. Accenture’s (NYSE: ACN) research indicates that adoption of key digital technologies in this sector can add tremendous value—unlocking R182 billion in value for the South African telecommunications industry, consumers and society by 2026!

According to the Global Connectivity Index, South Africa is among the countries with the most potential to use Information and Communication Technology (ICT) to boost growth.

While the local telecoms sector continues to grow, more needs to be done to strengthen the sector, increase its reach and lower the cost of services. This will improve the wellbeing of citizens and support economic development and growth. For telecoms operators, improving their competitiveness across a number of areas—in delivery of new services as well as supporting innovation—will be vital. Digital technologies will play a key role.

The digital factor

Telecommunications will provide the building blocks for the digital revolution. In key sectors, such as healthcare, education, entertainment, logistics, e-commerce and e-government, telecoms services and infrastructure provide a platform for the implementation of key transformative digital technologies. To deliver on this, the telecoms sector in South Africa needs to look first to strengthening its own capabilities and increasing its competitiveness.

Digital technologies have brought a number of new factors into play: the increasing ubiquity of smart devices has stimulated customer demand for new services and more personalised experiences, new players increase competition, and there’s downward pressure on pricing and increased regulation of the sector. To remain competitive and relevant, telcos must look for new ways to distinguish themselves, acquire and retain customers, and drive top-line growth.

Investing in digital technologies will be critical to create a new foundation for growth, power the digital revolution across multiple industry sectors and increase access to connectivity to drive socioeconomic advances in the country. But which digital technologies can deliver the most value for the broadest benefit?

South Africa's telecoms operators must start now to craft an ecosystem that will allow them to help shape the future of digital communication in South Africa.

Accenture's research – context and opportunity

Recent Accenture research, leveraging the value-at-stake framework developed with the World Economic Forum (WEF), measures the impact of digital technology on government, business and society, and quantifies the value these technologies can create. Additional Accenture analysis identifies which key digital initiatives will unlock the most value for South Africa.

Accenture recommends a dual strategy for telecoms organisations: protecting the core—traditional revenue streams such as voice and traditional data services—while simultaneously determining the pace at which they need to rotate into offering new services to offset revenue losses and grow market share.

Accenture has identified four digital themes that will address the key challenges within the telecommunications sector, laying the groundwork to deliver modern and relevant services and solutions, and compete on a new digital stage. These are:

  • Redefining customer engagement entails the use of data, new tool and capabilities to provide customers with more personalised service experience along the entire value chain.
  • Beyond the pipe looks at the use of digital technologies to extend revenue streams beyond the connectivity that their current infrastructure offers.
  • The research identifies four key initiatives that will shape the networks of the future: alternate connectivity, software-defined networks, zero touch networks, and cyber resilience.
  • Telecoms can help bridge the gap on innovation. New entrants into the digital economy rely on rapid innovation and an asset-lite set of infrastructure to accelerate speed to market. This will require infrastructure investments by telecoms operators. However, it will also see telecoms operators adopt new models of innovation enabling more of an ecosystem play through open-innovation, value hacking, incubation and design thinking approaches.

Everyone has a role to play

All stakeholders in the telecoms industry have a role to play to achieve this value. A collaborative approach is required to change conventional beliefs, enable the investments in infrastructure and put the standards and policies in place that will drive adoption of digital technologies.

For more insight into the opportunity for value creation that digital technologies offer stakeholders in the South African telecoms sector—and the steps they need to take to realise that value—click through to Unlocking Digital Value in South Africa’s Telecoms Sector.

Methodology

The Accenture and WEF value-at-stake framework assesses the impact of digital initiatives (from driverless cars and predictive analytics to drones and remote healthcare) on industries, consumers, society and the environment over the decade to 2026. In the assessment of industries, the framework integrates all segments of an industry's value chain, capturing approximately 80 percent of revenues and profits. It considers the total addressable market and the adoption or penetration rates of new technologies over time, and is based on research, industry reports, existing use cases and expert interviews. The framework also quantifies Digital Value to Society by aggregating the key performance indicators that measure the impact of digitalisation on health and safety, employment, the environment, labour and consumers. Additional Accenture research, based on expert interviews, local statistics, and other inputs, quantifies the value at stake in South Africa and identifies the key digital technologies and initiatives across industry sectors and government services that can unlock that value.

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