3 Big Challenges Facing the Telecom Industry Over the Next Decade

Across the world, telecommunications companies are trying to stay ahead of the massive growth the industry has seen over the last two decades. While much of the global population is already in network with a telecom company—with an estimated 80% to 90% of the world population using smartphones and accessing the internet—telecom companies face the ongoing challenge of enhancing their services cost-effectively. 

This presents a bevy of challenges, ranging from improved customer service and retention of users to automation and security threats. 

We asked some of our telecom experts at Insight Global and our professional services division, Evergreen, what they saw as the biggest challenges the telecom industry is facing now and in the future. Here’s what they said. 

Retaining Customers is Paramount 

In a highly competitive market, telecom providers will have to compete to keep their customer base, which means delivering the fastest, most reliable network at a lower cost than their competitors.  

This challenge means our customers will need to be hyper-focused on staying ahead of the technical curve, keeping costs contained, and providing the best customer experience for their base. 

– Jade Gilley, Managing Director of Telecom, Insight Global 

Telecom has traditionally struggled with subpar customer service, leading to high churn rates. It’s a big challenge to retain these customers. To address this, telecom companies are focusing on delivering consistent and personalized customer experiences with the help of data analytics, loyalty programs, and omnichannel support, among other services. 

– Mariah Dorian, Director of Professional Services, Telecom, Evergreen 

Technology, Security, and Tech Competition 

The root of a great telecom company is how good its technology is. There’s been a big shift to 5G over the last half decade, and 6G is on the horizon. But that’s just one challenge. There are still plenty of challenges across the telecom technology landscape. These include: 

• AI investments: Telecom companies have invested a lot in AI initiatives, and they’ll continue to do so. However, telecos need to start to see a return on that investment—real use cases that improve how a business and its technology function.  
• Security threats: With so many users, telecom companies are constant sources of attacks from bad actors. Telecom companies need a ‘security-first’ mindset, integrating security measures at every stage of the customer and service pipeline to ensure consistent and reliable service. 
• Cloud: Telecom companies are increasingly moving workloads to the cloud to conserve capital. This is all part of a push to reduce operating expenses. This shift allows for greater flexibility and scalability, essential for staying competitive. 
• Staying relevant amidst Big Tech competition: Big tech is encroaching on telecom’s core services, forcing operators to innovate beyond connectivity. Failure to do so may be viewed as “dumb pipe” providers of services who rely on Big Tech for innovation. 

– Mariah Dorian; Ramesh Garapaty, Director of Telecom Services, Evergreen; and Carlos Gonzales, Industry Principle—Telecom

Revenue, OpEx, and Cost Efficiency Challenges 

All the aforementioned challenges have an umbrella hanging over them: accomplishing all of this with cost effectiveness and efficiency. 

Telecoms need to balance rising network and technology investments and innovation with cost-cutting measures to sustain profitability. This is where cloud, automation, customer retention, and quality service come into play. 

One way to address cost efficiency is by identifying new streams of revenue. Traditional telecom revenues are stagnating. Most of the revenues today are driven by mobility, which is a limited pool to access between carriers. Good telecom companies are making private 5G services, AI-driven services, and diversification into the Internet of Things (IoT) a priority. 

Amid all of this, stricter regulations and limited spectrum access create hurdles for network expansion, finding new revenue streams, and general competition. 

– Mariah Dorian & Ramesh Garapaty 

What Are Some Solutions to These Challenges? 

Big challenges require global solutions. There are a couple of levers telecom companies are pulling to overcome these challenges. 

• Globalization: Companies are looking to offshore and nearshore some roles to push for innovation, cost efficiency, and to get on the front end of generational mobile network research. However, these investments must be met with a true investment in the people accomplishing these projects. Globalization with high attrition and a culture of churn does nothing to help overcome challenges. 
• Automation: While companies already have basic automation measures in place, the future will see AI-driven automation help make telecom companies and their employees more efficient and productive. It will also help in the realms of customer service, invoicing, network monitoring, fraud detection, and more. 
• Other cost-optimized solutions: Vendor consolidation, reskilling workers, and closing skills gaps are all ways telecom companies should—and often are—optimizing costs. One of the biggest costs a telecom company can face is its people. True investments in your people help with long-term cost savings in recruiting, turnover, knowledge transfer, and more.  

The telecom industry faces challenges from across the business spectrum. These challenges require strategic solutions to ensure sustained growth and competitiveness. Retaining customers through superior service, addressing security threats, leveraging cloud technology, and innovating beyond traditional connectivity are vital to pushing forward and staying ahead.  

Balancing these efforts with cost efficiency will be crucial for telecom companies to thrive in an increasingly competitive landscape.