The Internet of Things (IoT) has surged dramatically in recent years, becoming one of the most hyped, discussed, and anticipated technologies. As this excitement continues, the inherent value and potential of IoT are becoming increasingly evident. Meanwhile, traditional telecom models are growing outdated and less profitable, prompting significant changes in the telecom and technology industries. New players are entering the market, challenging established leaders
The Role of Telecoms in the IoT Era
A crucial question arises: Will telecom companies merely become "dumb pipes," or is there a value-add beyond providing network bandwidth? Communications Service Providers (CSPs) possess strengths in backend operations, including network connectivity, billing, provisioning, revenue management, and customer care. In the evolving IoT landscape, telecoms have a unique opportunity to become data aggregators and IoT enablers for enterprise applications through strategic innovation.
Telcos' Sustainable Business Models
Several traditional telecom giants have already adapted to the IoT era. For instance, AT&T offers over 2,300 types of certified connected devices and leads in fitness, smart locator, and smartwatch wearables. Verizon has taken an industrial approach, providing Smart City Solutions and Small Business Connected solutions for energy management, healthcare monitoring, cloud services, real-time asset tracking, fleet management, and more.
LogiSense customer Numerex (Now Sierra Wireless), a single-source provider of IoT solutions, offers a "Build Your Own M2M Solution" option and a wide range of connected products to enhance data analytics and functionality across various vertical markets, such as waste management, energy and utilities, public safety, healthcare, and medical devices.
These strategic shifts into the IoT are significant, indicating that service providers recognize the industry's evolution and are investing in future-supporting technologies. Despite their strong infrastructure, these providers must also upgrade their billing systems to accommodate and monetize the rapidly growing IoT market.
Adapting Billing Systems for IoT
As service providers transition from low-volume, high-value events to high-volume, low-cost IoT events, average revenue per user (ARPUs) is declining. To succeed, providers need accurate and precise billing systems capable of handling billions of events or usage data records. Upgrading these systems is essential for developing new business models that maximize revenues and ensure success in the IoT era.
The Shift to Usage-Based Models
One of the most disruptive changes in the telecom industry is the move towards more granular service models where consumers pay for what they use instead of purchasing discrete bundles. Usage-based models, such as Amazon Web Services (AWS), have become more common. AWS's pay-as-you-go pricing approach is popular among enterprises, which now demand similar flexibility from CSPs.
Leveraging BSS Experience for Future Success
The evidence is clear: Service providers that leverage their experience and the right back-office support systems during these early stages of the IoT revolution can enhance their value beyond traditional telecom profitability. Adapting quickly with automation, flexible integration, and the ability to bill for new usage-based business models will position service providers as preferred partners for enterprises.
Considering innovative directions is crucial for telecoms. By capitalizing on their decades of back-office management experience, telecoms can thrive in this new era and achieve continued success.
Tim Neil /
As Sr. Director of Marketing at LogiSense, Tim is responsible for corporate brand messaging and digital assets ensuring that future customers understand the immense benefits that LogiSense Billing brings. Tim has over 20 years of Product Management and Marketing experience in the technology industry.
