That’s the question being asked by telecoms executives across America, and in this article we identify four key concepts that will be crucial for your future success. These ideas cover technology and people, and in both categories we look both at how you can exploit your natural advantages and also how you can compete against the natural advantages enjoyed by larger competitors.
BIG IDEA #1: Your network is your moat
As an independent carrier, you likely face competition in voice services from two angles – nationwide over-the-top providers, who provide voice services over the internet connection you provide to your customers, and local competitors who have their own network (e.g. competitive cable companies).
The good news is that you have a big advantage over all the over-the-top folks, because you own and manage the network – all the way from the PSTN to the customer phone (or at least to the edge of their LAN). This gives you the ability to control and monitor the quality of voice services in a way that is just not possible for a third-party service provider who is sending their precious RTP packets over the public internet.
So by investing in your network – both in terms of the actual transport (high speed fiber to as many customers as possible) AND in terms of the quality of service provided for voice traffic – you create a significant competitive advantage that helps fend off the competition.
BIG IDEA #2: Virtualization levels the playing field Historically, one of the biggest challenges for a small service provider was the economies of scale enjoyed by larger competitors. Access to new products from vendors often involved purchasing expensive hardware which just didn’t make sense for a small subscriber base.
As a result, a large competitor could offer a more advanced range of products to their customers because they were distributing the cost of purchasing these items over a larger customer base and enjoyed more bargaining power with vendors.
As more and more products become available on virtual machines, and customized hardware becomes increasingly rare, this disadvantage is significantly reduced. Small service providers no longer need to purchase expensive hardware for every new product, but can instead deploy a virtual machine with a small number of capacity licenses based on the size of their subscriber base. While large competitors may still benefit from more bargaining power with vendors there’s no longer a huge financial barrier to entry when purchasing a new product.
BIG IDEA #3: Your local people are your strategic advantage
More than anything else, what makes a small-town telco different from a national competitor is that it’s part of the local community. Often the local telephone company has been part of the fabric of the community for generations, employing local people, taking part in community events, and so forth.
Not only does this community engagement create goodwill and opportunities for personal connections and marketing, the proximity of the business to the customers also allows the local service provider to offer a level of customer service that’s just not economical for a remote competitor.
Whether that’s on-site installers for new business systems, or a friendly face in the local office when someone has a problem, being physically close to your customers allows you to create face-to-face experiences and provide hands-on technical support in a way that larger competitors can never match.
BIG IDEA #4: Access experts when you need them
The flip-side of the previous idea is that big national competitors have access to the best talent in the country – with offices in big cities and large budgets they can attract the best engineers, the best strategists and the best product managers.
Their size simply gives them access to many more possible employees than you, and allows these employees to specialize more, whereas you may need one person to wear several different hats. As networks become more complex, your technical staff are expected to understand a wider range of products and technologies, whereas a large competitor can have a dedicated person for each area. As a result, their people are going to be more specialized with a higher level of expertise in each area.
However, in these days of internet access and VPNs and video conferences, you can hire people to work on your business who don’t physically live nearby. In many cases, you don’t actually need these experts to work for you full-time, so you can engage external consultants to provide you with expert insights when you need them – for a particular project, or on retainer for advice-as-needed.
This arrangement gives you access to a higher level of expertise than you’d typically be able to hire, while also saving money because you’re not paying a full-time salary and benefits.
(Yes, this last section could be considered a sales pitch: if you need access to a Metaswitch or VoIP expert, please contact us.)
We’d like to believe that if independent carriers capitalize on their strengths (ideas #1 and #3) while using technological advances to better compete with the big guys (ideas #2 and #4), they’ll have every chance of surviving and thriving in the decades to come.
Award Consulting is focused on helping regional service providers who use Metaswitch products to thrive as they improve their networks through migrations, strategic projects and improved service offerings.
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