When it comes to digital transformation, telecom trails other industry sectors. But telecom companies could tap into the partner ecosystem to reverse that trend, according to new research findings.
A mere 22% of telecom companies have successfully executed a digital transformation initiative, Boston Consulting Group (BCG) reported. That slice lags the cross-industry average of 35%, according to the management consultancy's analysis of 860 companies across a number of vertical markets. The low success rate "presents real risks of declining revenue growth and disruption by digital players," BCG noted.
Telecom companies face increasing costs, regulatory obligations and challenges in the path of delivering emerging technologies such as 5G. Inflationary pressure surfaced last week: Verizon and T-Mobile sparred on pricing, with the latter company declaring it will maintain its wireless plan prices as others raise rates.
Partners, however, could play a role in sparking innovation among telecom firms and boosting their market position. Telecom respondents rated the digital ecosystem and partnership area as their fourth highest transformation priority, BCG's research noted. Sixty-six percent of the companies polled cited the digital ecosystem, slightly above the cross-industry average.
"It's very hard to innovate now, without being effective in that ecosystem," said Patrick Forth, managing director and senior partner for Sydney at BCG.
A partner ecosystem strategy featuring co-innovation helps organizations overcome in-house skill shortages and accelerate time-to-market.
Reasons for lagging
Forth said telecom firms tend to struggle with the main success factors of digital transformation. Those include an integrated strategy, leadership commitment, access to high-quality talent, an agile governance mindset, clear metrics and a modern technology architecture, according to the consultancy.
Achieving transformation depends on how well an industry sector employs those factors, said Forth, who co-authored the BCG study. "Telcos, on average, are worse at applying those success factors than, for example, an IT service company," Forth said.
Patrick ForthManaging director and senior partner for Sydney, BCG
Telecom firms' deeply entrenched legacy business models present an obstacle. The telecom giants have invested heavily in networks, creating fixed-line products for which they could often expect 70% market share, Forth said. "That makes you adopt a business model which is mass and inflexible," he noted. "And the whole point of digital is to be customized and flexible. So, their starting point is a tougher one."
In addition, the complexity of fixed and mobile networking domains makes adopting digital harder to do, Forth added. Network engineers tend to be risk averse, with network outages their biggest concern. "That's all very understandable, but it's not helpful in terms of achieving the digital transformation," he said.
But while some telecom companies struggle with transformation, others are beginning to break away from the pack. Forth said perhaps 20% of companies are building digital capabilities, achieving revenue growth and improving customer experience.
Innovating through ecosystems
In addition, those digital leaders are pivoting toward innovation, whether in the network core, around 5G services or in specific customer segments such as healthcare and energy, Forth said. Such companies will increasingly open their APIs and work within a partner ecosystem, he added.
For telecom firms, potential ecosystem partners include cloud platform providers, device manufacturers in fields such as IoT and augmented reality, and application providers in smart manufacturing and smart agriculture among other areas, he said.
Channel partners also have a role to play. Earlier this year, Thirdera, a ServiceNow partner, rolled out a service and order management offering based on the ServiceNow platform and intended for telecom customers.
Channel partner program launches and updates
- Torq, a no-code security automation company in Portland, Ore., launched a partner program for VARs, distributors, systems integrators, managed security service providers and managed detection and response providers. The Torq Automation Alliance includes training for partner sales and sales engineering teams, marketing campaign kits and preview access to Torq platform releases.
- Matillion, a cloud data integration platform provider, updated its partner program with benefits including a partner portal, a partner account manager to assist with go-to-market plans, technical training and no-cost certifications. The program's tiered structure determines the specific benefits a partner receives. Matillion, with offices in Denver and Manchester, England, has expanded its program to include systems integrators, consultants and technology partners.
- Aryaka, a managed SD-WAN and SASE solutions provider, rolled out a revamped online training and certification program for sales agents, VARs and MSPs in its Accelerate Channel Partner Program. The certification courses include Aryaka Certified Partner, Aryaka Budget Planner Tool and How to work with Aryaka.
Merger and acquisition updates
- NTT Data, a digital business and IT services company based in Plano, Texas, has agreed to acquire New York digital strategy firm Postlight. The deal follows NTT Data's purchase of Nexient and Vectorform in the digital application development and modernization markets. Postlight offers design and engineering services in addition to strategy. NTT Data expects the transaction to close by the end of June.
- Zayo Group Holdings, a communications infrastructure platform company in Boulder, Colo., has acquired Education Networks of America (ENA), which provides managed network connectivity, communications and cybersecurity services in the education sector. ENA, based in Nashville, services K-12 school districts that participate in the E-Rate program, which aims to ease the cost of telecom for schools and libraries. Channel partners have found opportunities designing hybrid learning systems in the education technology market.
- Technology and services providers looking to build channel programs often grapple with determining the right number of partners and establishing selection criteria. That's a key takeaway from Gartner research released last week. The market research firm recommended first assessing whether a channel program makes sense, considering the reasons for launching such a program and understanding the way a customer prefers to buy. Other steps include calculating the number of partners required, developing a profile for the ideal partner and offering a "compelling proposition to attract partners," according to Gartner.
- Syntax, a managed cloud provider based in Montreal, launched a program that lets employees work abroad, choose in-office, remote or hybrid work, and set their own working hours. The company's Global Flex Program offers a Global Tourist option through which employees can work remotely from anywhere in the world for up to 30 or 60 days. Alternatively, employees can work up to four months in places where the company has a physical presence. The Flex Workplace program, with its remote and hybrid options, applies to employees whose work doesn't require them to work in a designated Syntax office. And Flex Schedule lets employees avoid punching a clock, provided they are accessible when needed, available for customers, attending meetings and completing their work, the company said.
- Apiiro, a cloud-native application security company, unveiled a partner program for technology, consulting and reseller partners. The program includes training materials, sales resources, access to technical evaluation demos and documentation for go-to-market and joint-promotion opportunities. Partners include Alacrinet, Defy Security, Google Cloud, HashiCorp, NetSPI, NXGN, Parabellyx and Trace3. Apiiro has offices in Tel Aviv and New York.
- MSPs using Augmentt's SaaS security products will receive a discount on SeedPod Cyber's cybersecurity insurance -- and so will their customers. The MSP discount will vary depending on size, number of customers and other factors, according to a spokeswoman for Ottawa-based Augmentt. MSP customers will receive a discount of up to 40%. MSPs using Augmentt Discover and Augmentt Secure together qualify for the SeedPod Cyber Insurance Program. The program offers cyber insurance covering data breaches, ransomware attacks, cyberthreats and loss of income attributed to cyber-related incidents.
- Upstack, a web platform that sells cloud services through technology advisors, inked a strategic partnership with Lumen Technologies, which provides managed network and IT services. Upstack advisors will sell Lumen's offerings to their enterprise, midmarket and SMB customers. Upstack, based in New York, continues to grow through acquisitions, having most recently purchased Universal Telecommunications Inc., a telecom agency, and its affiliated MSP, Universal Solutions Providers.
- Sumo Logic, a SaaS analytics platform vendor based in Redwood City, Calif., appointed Timm Hoyt as senior vice president of global channels and alliances. Hoyt previously worked at PagerDuty, Druva, Atlantis Computing, Skyera and Brocade.
- Tollring, a business analytics company in Uxbridge, United Kingdom, appointed Craig Hoile as head of channel sales. Hoile previously worked with partners at Virgin Media 02, Microsoft and Vodafone.