Global economic turmoil, disruptive technologies and convergence, have produced a “perfect storm” that has been buffeting the telecommunications industry in recent years.  Convergence (News - Alert) continues to blur the line between competitors and collaborators, leaving communications service providers (CSPs) scrambling to find their spot on the stage.  These tough conditions are part of the challenges communications service providers face as media companies become telecommunications firms and vice versa, or search and advertising companies become telecommunications providers, all converging and competing for the same customers.

The next challenge is the shift in consumer spending from traditional fixed voice and data services to new over-the-top applications and converged services, such as making mobile payments, watching videos, or operating an intelligent home. Simultaneously, data revenue is failing to keep pace with broadband traffic on already capacity-constrained networks. To resolve these issues and manage the quality of services customers demand, CSPs are being compelled to revamp their operating models and adopt new network technologies.

To shed light on major trends taking place in network operations globally, Accenture (News - Alert) recently surveyed executives involved with making network investment and technology decisions. What surfaced from the survey is a picture of an industry in transition. While, the old ways have not been totally abandoned some CSPs have embraced the new realities and others are taking more of a “pick and mix” approach.

The growing demand for high-speed Internet connectivity, with much of it happening over smartphones, has brought about profound technological change. An array of technology developments are acting as accelerators of convergence, including mobility, analytics, cloud, digital and social networks, all requiring broadband networks.

For most of the largest CSPs, employing the right tools for broadband deployment is clearly a priority the majority of executives surveyed identified the need for new or improved tools to plan, design and track traffic on broadband or cable networks. Roughly one-third cited the need to significantly revamp the tools used for their deployments.

Survey responses also point out that technological transformation is the real driver behind the industry’s move toward a more accurate model for controlling network planning and enhancing quality of service. When asked about specific technology investments, 75 percent of wireless operators and integrated services providers confirmed plans to implement new technologies such as 4G long-term evolution (LTE (News - Alert)) services in the next three to five years. Further, all wireline providers said they would swap all or part of the cable used to connect homes and businesses to networks from copper to fiber optic, also over the same time frame.

With the acceleration of commercial LTE deployments, carriers are looking at different levels of network sharing as a way to ease network congestion. In fact, about one-quarter of survey respondents said they currently have a network sharing agreement in place. The survey also exposed some differences between mature and emerging markets with CSPs in emerging markets more likely to deploy network sharing for their mobile broadband networks than their counterparts in mature markets.

On the other hand, in a shared network environment, managing the quality of services can be a major challenge. Around half of those surveyed cited service quality management and the need to meet customer service demands as key differentiators for broadband services. From the network tools standpoint, using analytics to measure and address service quality appears to be top of mind among respondents. In fact, all interviewees plan to invest in network analytics, and more than half said they would use network analytics tools as a way to improve service effectiveness. Furthermore, from an operational point of view, about one-third of respondents said that they favor introducing a dedicated service operations center in their network operations group.

It is quite clear that CSPs are at a crossroads. The network-centric operating models simply cannot keep up with the real-time challenges arising from consumer quality of service demands and the fierce competition coming from over-the top services. The erosion of revenue will continue for CSPs that don’t react quickly and strive for a more industrialized and collaborative approach. They must move toward more innovative models, while keeping convergence in mind, and making new technology investments. When assisting providers in this area, technology vendors and service providers must bring more compelling value propositions through value-based contracts that fully capitalize on advanced solutions. It’s time to take action, the clock is ticking.

Paolo Sidoti is global managing director, Network Business Services group, Communications Industry, Accenture.  For more information on Accenture Network Services, please visit www.accenture.com/network-services.