Partnering for success

David James/Ovum
04 Sep 2012
00:00

Economic uncertainty and intense competition make it increasingly difficult for telecom carriers to achieve their business objectives without close cooperation with suppliers, customers and other organizations with complementary capabilities. An increasing number of carriers have recognized that partnering enables them to broaden their service portfolios, increase network reach and respond more quickly to changing customer requirements than the alternatives of in-house development or mergers and acquisition.

However, it is tempting to see the use of the terms partner, partnering and partnership to describe virtually every relationship that carriers have with other organizations as marketing spin. Ovum’s recent research has concluded that there are important differences between carriers’ relationships with their partners and other types of relationship they have with external organizations.

Different models

The telecom market is characterized by rapid change. Demands for ever-greater bandwidth, mobility and convergent value-added services are putting extreme pressures on retail and wholesale telecom markets alike. Belgacom’s chairman Didier Bellens stated: Because we know that in this evolving market we constantly need to be ready for the day after tomorrow, we are increasingly partnering, outsourcing, co-sourcing. We cannot do everything on our own. That is why we are now open to partners, so our customers can get a wider variety of content and services to match their needs.

The plethora of relationships that carriers are involved in can be grouped into three types of partnering arrangement:

  • Supplier partners those from whom a carrier buys products or services to use in the services it offers to its customers
  • Customer partners channels to retail customers who incorporate the carriers’ services into their own services
  • Collaborative partners organizations that a carrier works with to develop capabilities that are jointly offered to the market.

Many telcos work closely with their suppliers to develop new services for the telco's customers. For example, NBN Co in Australia regards equipment vendors Alcatel-Lucent and Nokia Siemens Networks and systems integrators Accenture and IBM as "technology partners" with whom it is tackling the technical challenges of deploying a national infrastructure.

Similarly, BT cooperated with Cisco to develop its online TV and video service. Cisco’s infrastructure enables the carrier to deliver video content to PCs, TVs and mobile phones. BT’s customers buy the resulting service, incorporating the Cisco components, from the carrier.

Many carriers regard some or all of their customers as partners because they work closely to satisfy the demands of the ultimate end-customers. This is particularly true of intermediaries that enable a carrier to reach complementary segments of the retail market, such as SMEs or particular consumer niches. Customer partners act as a channel to market for the carrier and in doing so the carrier is seen as a supplier partner by the intermediary.

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