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Telcos’ future plans for wholesale, resale and B2B impact how they spend on BSS today

A TM Forum survey reveals how telcos' vision of future wholesale services is shaping their BSS investments.

Ed FinegoldEd Finegold
19 Jan 2024
Telcos’ future plans for wholesale, resale and B2B impact how they spend on BSS today

Telcos’ future plans for wholesale, resale and B2B impact how they spend on BSS today

Just over half of communications service provider (CSP) respondents to the survey for our new report BSS for B2B: operators diverge on the path to cloud think the traditional divisions between their wholesale, B2B and partner resale businesses will fade within the next five years as they search for new revenue. But that means that nearly as many operators don’t foresee this change. The difference in outlook has a direct impact on how much a CSP plans to spend for various BSS capabilities and how aggressive their approach to improving legacy BSS will be.

Our survey shows that CSPs are split on how they will improve legacy BSS. While 45% are taking or plan to take an aggressive, transformational approach (which usually means moving to cloud-native systems), 42% are opting for a more cautious approach to legacy BSS improvement (see graphic below). These numbers shift, however, when CSPs believe that roles traditionally bounded by their B2B, wholesale and resale organizations will change to meet new demand from enterprises searching for large-scale ICT solutions in many verticals.

Legacy BSS

Convergence of CSPs’ traditional lines of business is happening because ICT solutions demand integrated components that usually are provided separately by these divisions. For example, traditionally the wholesale division provides bulk connectivity, B2B provides custom tariffs and discounts, and partner channels provide application-specific devices. In our survey, nearly two thirds of CSP respondents who said these old organizational boundaries will fade also said they are taking a transformational approach to legacy BSS.

Changes in spending

Views about shifting organizational boundaries can directly impact which features CSPs look for and how much they are willing to spend on key BSS components. Our survey found that most CSPs plan to spend more on partner and ecosystem management, customer relationship management (CRM) and customer experience (CX) than on other BSS components like billing, rating and charging, and mediation.

Partner and ecosystem management

Regardless of whether telco divisions converge, most CSPs are likely to spend more for partner and ecosystem management BSS components in their next budget cycle. Indeed, organizational divisions have little impact on the desire to add partner capabilities, with two thirds of all respondents saying they will spend more to support partner-based service bundles and sophisticated enterprise solutions.

Where respondents differ, however, is in how much they plan to spend. Among respondents who think their B2B, wholesale and resale organizations will overlap, 37% said they will spend considerably more for partner and ecosystem management, and 26% will spend a little more. By contrast, only 21% of respondents who expect wholesale, retail and B2B to remain separate said they will spend considerably more. It’s important to note, however, that nearly half (46%) of those respondents said they will spend at least a little more to enhance their partner and ecosystem management BSS – a sign that the market widely acknowledges the importance of partnering.

Customer relationship management

Business unit convergence does appear to have a big impact on CRM spending. Among CSP respondents who do not expect B2B, resale and wholesale to overlap, over 60% will spend at least the same amount on CRM capabilities, while 65% of the respondents who do expect convergence plan to spend more on CRM. It stands to reason that CSPs anticipating more complexity in their customer relationships and a greater need to broaden their offerings would feel greater urgency to invest more in CRM capabilities.

Customer experience

All CSPs plan to spend more for CX capabilities in the coming years – a lot more. Among respondents who think their B2B, wholesale and resale roles will overlap, 80% will spend more for CX capabilities as will 77% of respondents who don’t think this change will happen. Among both groups, more than half of CSPs will spend considerably more to improve their CX capabilities.

The major differences lie in where and how these new CX BSS capabilities are being deployed. About 56% of respondents who plan to spend considerably more for CX said they will adopt low-code/no-code solutions. These solutions, which are often delivered as software-as-a-service (SaaS) hosted in public clouds, can help CSPs avoid customization and ownership of IT infrastructure.

Low-code/no-code the next frontier?

The percentage of respondents who plan to adopt low-code/no-code solutions jumps to 71% in the group of respondents who said they will spend considerably more for CX and think their B2B, wholesale and resale organizations will overlap within the next five years. Indeed, the more aggressive the CSP’s BSS transformation strategy and market outlook, the more likely it is to pursue a low-code/no-code BSS solution for CX, CRM and partner and ecosystem management.

This may ultimately prove to be the biggest shift in the BSS market during this period of significant change as CSPs decide whether to adopt simpler solutions running in the public cloud. The alternative is deploying cloud-native BSS in their own private clouds, which would allow them to continue using BSS customization as a differentiator.

For a closer look at these BSS market dynamics and how CSPs plan to spend for, improve and implement new BSS capabilities, download our report BSS for B2B: operators diverge on the path to cloud.