Edition #12: What Is Telecom’s Fastest Growing Revenue Source? Hint, It’s Not 5G.

In this edition of Telco Talk, Maplewave’s CEO, Adam Baggs, shares his thoughts on how telcos can quickly capitalize on fibre as a revenue source while 5G takes time to ramp up.  

For years, we’ve been hearing about the possibilities of 5G. This supercharged network is 20 times faster than 4G LTE, which makes it possible to bring new experiences to life that we can only dream about today.  

5G has been hailed as the next telecom cash cow, as it’s set to impact almost everything in our lives. Most of us have heard about “the connected home”, where users can remotely control every system in their home, including thermostats, appliances, surveillance equipment, and more. The automotive industry will soon be transformed as well – think internet connections in the vehicle, augmented reality displays – and true self-driving functionality that can instantaneously communicate with other vehicles and analyze surroundings.  

Over the past several years, telcos have started the long process of upgrading their network infrastructure so they can bring the 5G dream to life. But as the saying goes, the best laid plans often go awry.  

For 5G, that was the Covid pandemic. In the face of economic uncertainty, supply chain disruptions, and operational challenges, the progress of 5G rollouts took a dip. But this temporary detour revealed an unexpected opportunity. With the whole world suddenly working from home, glued to an endless parade of video conferences, a new revenue opportunity revealed itself – home fibre.

The Meteoric Growth of Fibre

Worldwide, fibre optics growth has exploded. On a global scale, the fibre optics industry size was valued at USD 4.9 billion in 2022 and is projected to reach USD 8.2 billion by 2027, growing at a compound annual growth rate of 10.9%.

There are regional differences of course. It appears that the Asia-Pacific region has seen the most investment in fibre optics from 2019 to 2023. Latin America has also seen notable growth in fibre. Peru is estimated to be the fastest-growing FTTH market in the region with a mindboggling 95.2% 10-year CAGR.

It’s clear to me the opportunity is there. But as always, execution matters.

How to capitalize on fibre today

Selling fibre is a daunting task. Usually, it’s done in blitz-style campaigns. Fibre lines are run to a community, and the telco promotes its new offering in that service area. Sometimes telcos will use kiosks, and physically rotate them around to maximize their coverage. Most often, door-to-door sellers are leveraged to try to entice existing customers to upgrade, and to lure others away from competitors.  

It’s an effective tactic, but one that is often inefficient. Like anything in today’s world, we can supercharge results by using the power of digital transformation.  

Today, the door-to-door sign up experience is fairly uninspiring. That salesperson can give customers all the information about the service, but they rely on customers taking the extra step of phoning a call centre to complete the sign up and schedule their installation.

But what if that salesperson could complete the whole transaction for the customer right on their doorstep? With the right tablet-based indirect solution, the salesperson could show the customer the different available plans, conduct a credit check, digitally sign any paperwork, and schedule an installation appointment right there. No additional work is required from the customer, which eliminates the risk of them forgetting to sign up.

But you can take this experience one step further. When you layer this solution with geofencing capabilities, you can create a complete field management solution. This is something that many in our industry are exploring today.

Imagine a world where you could establish geofenced sales territories and assign them to salespeople. All sales are time stamped and geocoded, so if that person sells outside of their territory, their manager is notified. The reporting opportunities are endless as well, making it possible to track sales performance over time, compare the performance of different salespeople against each other, as well as markets and even countries.  

All this to say, the technology exists to rapidly seize this new revenue opportunity.

How to Capitalize on 5G tomorrow

While the potential income from fibre will steadily grow over the next several years, it will eventually peter out as the market becomes saturated. How long that takes will depend on how entrenched fibre was to begin with.

By the time that happens, telcos will be well on the way to capitalizing on 5G. Many industry watchers believe 5G will become dominant by 2027. This is when infrastructure investments should be completed, and most consumers will have a 5G-enabled device.

When it comes time to make the 5G push, digital solutions will also play a key role in telcos’ success. I believe that self-care apps will be invaluable. Think, now the scope of services extends beyond a SIM in a phone. Consumers will have SIMs in their appliances, vehicles, and more. All those subscriptions will need to be managed. Without a self-service option, just imagine the burden on retail stores. With a purpose-built self-care solution, it will be simple for customers to manage all those services themselves – and upsell them on new features.  

The other benefit? Consolidated billing. With a plethora of subscriptions, bills will consequently get more complex. With a self-care solution, it becomes simple to boil all those figures down into one consolidated number. It’s an experience that customers have been wanting for years but will become even more important in the future.

If I have any advice, it’s this – don’t try to do it yourself. I’ve seen too many telcos try to build their own self-care apps in the past. Do you really want to commit yourself to managing this infrastructure long-term? It’s not build it and forget it, especially as these self-service journeys are going to get even more complex. The best digital tools are designed to be evergreen and evolve as new features become desirable. Instead, focus on being a telco, not a software company.  

Summary

The next 5 years are going to be interesting ones for the telecom industry. While the transformative 5G wave takes some time to mature, telcos have an interesting opportunity to capitalize on an important revenue stream for right now – fibre to the home.  

How are you preparing for 5G? Do you have plans to supercharge your fibre sales?

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