Telecoms service providers can no longer satisfy all of their customers’ needs without relying on wholesale services bought from other service providers. Intermediaries that buy services wholesale can decrease their time to market, transform capital costs into operational costs, and take advantage of other players’ experience and expertise. Now an essential part of the telecoms landscape, the wholesale market delivers an increasing range of services through an ever more complex value web.
While telecoms service providers across the globe now accept that providing services on a wholesale basis can be a valuable channel to market, in the face of increasing retail competition, they need to understand how to differentiate themselves from their competitors. Ovum’s wholesale research and analysis helps players understand and respond to their competitors’ strategies, their customers’ changing needs, and the changing market for wholesale services. It also informs the burgeoning number and variety of intermediaries about the capabilities of wholesalers to meet their needs.
- The evolution of wholesale
Key Themes
Wholesale customer segmentation
During the last decade an increasing variety of intermediaries have emerged which are dependent on wholesale services. While some of these intermediaries are “traditional” wholesale customers, such as mobile operators and ISPs, the range of new entrants with little or no prior experience of offering telecoms services has grown dramatically. These wholesale customers differ significantly in the services they buy, the criteria they use to select wholesale providers, and the types of support they require from wholesaler service providers. Wholesalers must understand and respond to these differences to win and retain intermediaries’ business.
During 2012 we will continue our examination of the differing needs of traditional and emerging wholesale customer segments. We plan to research the changing mobile virtual player landscape, focusing on the services they need to buy to support their different business models. We will also investigate what wholesalers can offer to help mobile operators cope with the ongoing explosion of mobile data traffic. Our analysis will revisit the reseller and sub-wholesaler markets, and will make recommendations on how wholesalers can support them cost effectively.
Improving the wholesale customer experience
Wholesalers are realizing the importance of how they handle interactions with their customers and prospects, and focusing on improving performance in this area. To this end, more and more wholesale service providers offer customers powerful web portals and automated interfaces to handle routine transactions efficiently and cost effectively, freeing up staff to deal with more complex and tailored solutions. An increasing number of wholesale service providers are also launching partner programs that broaden the range of compatible services and support offered to their intermediary customers. Other forward-thinking wholesalers work with their customers to customize packages of value-added services that help both partners win additional business.
The range and capabilities of wholesale customer interfaces have developed significantly since we last addressed this subject. In 2012 we plan to report on successful customer interaction strategies and partner programs deployed by wholesale service providers.
Wholesale’s role in enabling the cloud
To date, the hype surrounding cloud services has largely failed to address how cloud services are enabled by the infrastructure and services provided by telecoms wholesalers. The cloud services offered to enterprises and consumers are inextricably dependent on a variety of wholesale services that provide connectivity, hosting, interconnection, and interoperability.
We plan to investigate the developing opportunities for wholesalers in hubbing and interconnection to enable the interworking of disparate cloud-based retail services. Our research will address how wholesale services tether the cloud hype and advise carriers what they should do to benefit from the cloud services market.
New competitors in wholesale
The market for international wholesale services is consolidating around a small number of huge service providers that have the reach and economies of scale necessary to support the international communications services on which we all depend. At the same time, however, new players are entering the wholesale market, offering services to intermediaries over previously private infrastructures. Some of these new entrants are concentrating on providing “no-frills” commodity services, whereas others are seeking to carve out new niches in the wholesale market.
In our research we will investigate a number of different types of new wholesale competitors, such as CATV players and low-cost commodity service providers. We plan to pay particular attention to the developing dynamics between these new players and the established players in the market – where do their capabilities and interests compete and where do they complement one another?
