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The wholesale telecoms market is characterized by intense competition between players and the commoditization of traditional services.
To succeed in this challenging environment, wholesalers must be attentive to the evolving needs of their customers and adapt their offerings to meet those demands.
Customers want to be able to order, configure, and operate the services they depend on quickly and accurately. Traditional manual interfaces are prone to error, insufficiently flexible, and do not provide a reliable picture of the customer-supplier relationship. Wholesalers are now rolling out a variety of digital customer interfaces, including web-based portals and APIs to reduce delays and the need for error-prone manual intervention. However, there is little consistency between customer interfaces from different suppliers, and even between interfaces for different services from a single supplier.
Furthermore, many wholesale customers depend on services bought from multiple wholesale providers. It is not feasible for them to use a multitude of different portals, nor is it practical to develop software to utilize diverse supplier APIs. Furthermore, some of the largest buyers of wholesale services still prefer to use traditional technical interfaces to order, configure, and operate those services. Wholesale suppliers must be attentive to customers' needs for effective and efficient interfaces, while being cognizant of customer preferences for different interface types.
The increasing complexity of retail communications services demanded by and offered to consumers and enterprises depends on the availability of a wide variety of wholesale services. Ovum's most recent Wholesale Customer Surveys have shown that many wholesale customers shop around to find the services they require. Those customers often seek a specific combination of price, quality, performance, availability, reach, resilience, and other parameters to support their needs.
Supplier loyalty is less important to wholesale customers than the ability to secure services with the combination of characteristics they require. Hence, wholesale customers are willing to seek out suppliers that can meet their needs. As one Western European virtual network operator explained:
of respondents used more than 10 wholesale suppliers
– Ovum's 2018 Wholesale Customer Survey
As an international wholesaler stated: "We have about 300 wholesale suppliers worldwide – there's a long tail of smaller players. The stated policy is to have as few as practical, but realistically we need to add more to secure the services and footprint we require. We added around 10–20 wholesale providers last year."
The customer interfaces provided by these wholesale suppliers for service quotations, provisioning, operation, management, trouble ticketing, and billing are often very different, with each supplier offering its own suite of portals, interfaces, and direct customer support.
The managerial and operational challenges of using so many wholesale suppliers often result in large and expensive procurement teams: "We have a team of about 25 carrier relations people who engage locally to find last-mile providers. [We] tend to use the big incumbent plus another one to four suppliers per country depending on the market and the type of service required."
Wholesalers should make it easier for their customers to do business by simplifying and rationalizing interfaces. This may involve outsourcing that complexity to provide customers with a less complex array of interfaces.
Much of the trade in international capacity, voice and data transport, and termination continues to be carried out in face-to-face meetings between the leading carriers of the world's communications traffic. Buyers and sellers of wholesale services meet at conferences to negotiate and agree on deals for the carriage of international traffic worldwide. However, this traditional model is anachronistic and creates barriers to entry for new players. Today, communications traffic flows are much more dynamic. Wholesale services need to be provisioned and managed on demand to meet changing customer requirements.
Wholesale market transactions have long relied on personal relationships between the biggest players, making it extremely difficult for service providers that are smaller or new to the market to break into that club to find and agree to terms with the players that can support their business objectives. This is particularly difficult for putative new entrants attempting to launch unconventional business models, such as those based on revenue sharing or advertising.
Some new service providers attempt to overcome this barrier by outsourcing all of their off-net traffic to a single wholesale service provider. However, this limits their ability to pick and choose services from different service providers to meet their needs, which can limit their ability to differentiate. Reliance on a single supplier can also expose customers to risks, such as the bankruptcy or acquisition of the supplier, changes in the supplier’s strategic objectives or service portfolio, or changes in pricing or contract terms at renewal.
Electronic customer interfaces, such as web portals and APIs, can democratize the availability of wholesale services beyond the usual suspects by making wholesale services accessible to service providers without the necessity of face-to-face meetings and complex contractual negotiations.
The key benefit of the portal is that it hides the complexity of the various back-end systems used by the wholesaler to configure and operate the service behind a user-friendly interface that is available around the clock.
Web portals are designed to be easy and intuitive to use around the clock with minimal support from contact center or account management staff. A good web portal will incorporate context-sensitive help and data-entry checks, reducing the need for repeated entry of the same data and reduction of opportunities for manual keying errors. A customer portal for a single service can expose as many of the parameters and functions to customers as the wholesale provider thinks fit. Wholesalers do not charge customers to use these service-specific portals, although they generally limit access to existing customers.
Several wholesalers have developed customer service portals that encompass all user-accessible functions of their entire service portfolio. This "one-stop shop" approach is attractive to customers that only need to learn a single interface for all their interactions with that wholesale supplier. This type of portal can be instrumental in retaining customers that might otherwise consider churning to alternative suppliers.
However, these comprehensive portals can be very complex to develop because of the variety of legacy back-end systems used by some larger wholesalers. These one-stop portals are easier for smaller service providers that have more limited service portfolios to develop, but even they can find the exercise challenging.
Early activity around the introduction of telecoms APIs has focused on the consumer market, with APIs for voice, messaging, location, and billing. Development efforts have moved to developing APIs to enable enterprises and their systems integrator partners to incorporate telecoms services into business applications.
Although some telecoms service providers charge enterprise customers for access to their APIs, the consensus from Ovum's conversations with a variety of carriers is that wholesalers do not charge customers to use their APIs. Instead, wholesalers offer APIs with the objective of retaining and growing business with customers while limiting their own costs.
"A provider with an API is more of interest than one that doesn't because we can use that in presales and online buying. That sort of innovation is advantageous but may not sway the purchasing decision. However, online ordering is of interest. Operationally, it's also useful to do online testing of circuits." – International wholesaler
Many customer interfaces offered by wholesalers to order, configure, operate, and manage telecoms services have been developed independently for different service types (e.g., voice transport or last-mile access). Although these services often have very different parameters and functions associated with them, wholesalers should use all interactions with customers to gather information about usage patterns and preferences.
Siloed interfaces, functions, and services are insufficient and fail to contribute toward a better understanding of the end-to-end relationship between supplier and customer. Metrics associated with portal or API use can be used to improve those interfaces and identify where alternative services or configurations may better suit customers' needs.
Wholesalers must continue to adapt and change the customer interfaces they provide as the services they support and capabilities they enable evolve. Interfaces should keep pace with service developments and the needs of new customer segments.
Although traditional models of interaction and technical interfaces remain popular among some customer segments, wholesalers should continue to enhance digital interfaces (portals and APIs) to offer customers the same capabilities. Digital interfaces are available around the clock to serve customers and can provide a valuable source of information to guide future upgrades.
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