It’s a tough world out there when you are a telecommunications service provider (“telco” for short). Service providers are used to fighting for every single win, but recently the battle has intensified. Fierce competition pushes service providers to match prices and features, which means that services have become commodities in the eyes of customers. This forces more discounting, which leads to ever-lower margins and reduced commissions for service provider sales teams.
Consumer revenue is flattening, so service providers are looking for new ways to deliver value for their customers and reinvigorate growth in their bottom lines. To succeed, a service provider needs to diversify beyond the triple play (bundled internet access, television, and telephone) and escape the constant battle to the bottom for low prices.
Differentiate beyond the triple play
Most service providers are seeking new ways to penetrate the consumer market beyond the triple play. Many telecommunications providers look to STL Partners, a global research and consulting firm who specializes in the telecommunications industry, for insights about how they can better serve their customers and maximize revenue. New research from STL Partners indicates that consumers are looking for more from their service providers than the basic services of prior years.
New consumer opportunities emerge
The consumer landscape is changing, opening new opportunities for service providers. As more consumers shift to working and attending school from home, they expect more from their home services. STL Partners reports that due to “increasing digital maturity of consumers in general, demand for reliable connectivity as well as additional value-add services is growing in the market. Consumers are expecting more from their broadband provider, and this presents telcos with an opportunity to become more relevant in the home.”1
“Consumers are expecting more from their broadband provider, and this presents telcos with an opportunity to become more relevant in the home.”1The Changing Consumer Landscape: Telco Strategies for Success, STL Partners, 2020
The report delves into strategies that service providers can pursue to win in the home. One opportunity jumps to the top of the list: offer cybersecurity services to consumers as part of a differentiated service offering.
Consumers are ready to pay serious money for cybersecurity
Headlines in the news about data breaches, brands violating data privacy regulations, and hackers stealing personal information are all drawing consumer attention to the topic of digital security. STL Partners found that more than half of the respondents globally selected “cyber threats are a major concern” (25%) or “cyber threats are a concern for me” (33%).1 Overall, cybersecurity is at the forefront of consumers’ minds. More specifically, this general cyberattack concern translates into a clear willingness to pay for protection.
- All consumer demographic groups express deep concern about cyberattacks
- Consumers show clear willingness to pay for security coverage, even in low average revenue per user (ARPU) markets
- Consumers are willing to purchase cybersecurity services from their broadband provider.
- Millennials are willing to pay even more for cybersecurity protection.
All of this is music to a service provider’s ears. Cybersecurity offers a clear path to delivering a differentiated service that consumers will prefer and will command a premium price.
Although we focus on cybersecurity in this blog post, the report also provides detailed insight into other in-home opportunities for telcos to explore. It reviews multiple strategies for service providers to capitalize on consumers’ heightened attention and desire to receive high-quality, high-reliability services in their homes.
Cloud-delivered security with simple deployment
For years, Cisco Umbrella for Service Providers Easy Protect and Mobile Protect have provided a “clean pipe” for small and medium businesses (SMB). Umbrella uncovers attackers’ infrastructures staged for attacks and proactively blocks requests to malicious destinations before a connection is established (without adding latency for users). With Umbrella, service providers stop phishing and malware infections earlier, identify already infected devices faster, and prevent data exfiltration.
Now, the same great Umbrella security can also protect a service provider’s consumer customers. That’s a big deal. It’s been well established that SMBs face intense cybersecurity threats, and their cybersecurity needs are usually under-served. A recent Data Breach Investigations Report noted that 43% of all data breaches specifically target SMBs.2 Likewise, consumers too face relentless cybersecurity threats with limited resources to fight back.
Now, service providers can thwart those threats on behalf of their consumer customers by delivering cloud-delivered cybersecurity services as part of a new or existing offer. The consumer gains protection from malware, phishing, ransomware, and more, with no additional effort. The service provider generates revenue beyond connectivity, deploys protection rapidly with a simple attach, builds customer loyalty, and differentiates their brand from the competition.
Simple to sell, easy to deploy and manage
The consumer market is primed and ready for connectivity services with robust added security. STL Partners delivers specific guidance for how service providers can monetize this trend. To learn more, download the entire report here.
Then, learn more about how Cisco Umbrella Easy Protect and Mobile Protect enables service providers to protect consumers and increase revenues with a simple attach to existing internet or mobile services.
1. The Changing Consumer Landscape: Telco Strategies for Success, STL Partners, 2020: https://learn-umbrella.cisco.com/analyst-report-library/the-changing-consumer-landscape-telco-strategies-for-success
2. 43% of All Data Breaches Target SMBs, Verizon 2019 Data Breach Investigations Report, https://enterprise.verizon.com/resources/executivebriefs/2019-dbir-executive-brief.pdf