FEATURE : TELECOM performance drivers , total shareholder return disaggregation shows that they have generally benefitted from rising revenues and net margins .
New formula for value creation
New thinking will be needed for creating value over the next five years . In pursuing a formula for success , BCG identified seven key areas of focus for telcos to deploy to achieve optimal results .
These include :
• To defend the core
• Drive growth outside the core
• Maximise asset leverage
• Radically optimise costs
• Adopt core to cloud optimisation
• Deploy next generation architecture
• Turn GenAI magic into impact
Regionally , we have seen how MTN has driven growth outside of its core and captured revenues adjacent to the network business by offering a comprehensive range of financial services under the Mobile Money , MoMo brand across its pan-African network footprint . MoMo allows users to purchase airtime and data , pay bills , send , and receive money , and the ability to apply for personal loans .
Since its launch in 2019 , the user count on MTN ’ s MoMo has grown rapidly from 28 million to 72.5 million in 2023 .
Of the seven areas , BCG believes GenAI presents a massive opportunity for the telecom industry , not merely as a technological advance ; it can catalyse profound transformation along the entire value chain . From reducing costs to creating new products and experiences , the benefits of GenAI are tangible and far-reaching .
OVER THE PAST FIVE YEARS , BHARTI AIRTEL GENERATED
AN ANNUALISED TOTAL SHAREHOLDER RETURN OF 30 %, HIGHER THAN ANY OF THE OTHER 58 COMPANIES
IN BCG ’ S SAMPLE .
This was in evidence at MWC where technology played a central role in all the keynote speeches , panels , and conversations in which BCG ’ s team on the ground took part , not to mention the fact that the topic of artificial intelligence was everywhere .
The strategies above are not instant fixes ; they require sustained effort . Falling interest rates may free up more capital to invest , but they will not ease many of the industry ’ s other problems such as uneven returns from 5G investments and static revenue .
Against this background , it should be no surprise that the industry ’ s value creation tends , on average , to fall below that of most other sectors over a five-year period . Nevertheless , the upper ranks of the telecom industry ’ s total shareholder return tables are occupied by companies whose leaders have achieved much more .
These value creators show the way for others ; senior leaders can combine and customise the seven recommended drivers for success above to create their own , company specific formula for success . p
For instance , GenAI-enabled customer service may at some point reduce service interactions by 50 % or more , while improving customer satisfaction .
Realising this potential , however , demands more than just technological integration . Executives must think about where and how to deploy it . With so much potential available for tapping , they should think big .
We have seen how the most innovative telcos have begun harnessing the power of GenAI , with early applications in areas such as task automation , product and services hyper-personalisation , and business process transformation showing promising progress toward commercial success .
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