Examining the Telecommunications Industry’s Value Chain

• Subscription: Charging customers a monthly fee for access to services.​
• Pay-as-you-go: Charging customers for each use of a service.​
• Advertising: Selling advertising space to businesses on telecommunications networks.​
• Wholesale: Selling network capacity to other telecommunications companies.

Cable and broadband companies offer high-speed internet, TV, and digital communication services to homes and businesses through advanced infrastructure. Here's how they generate revenue:

1. Subscription Plans: They charge monthly fees for internet and cable TV. These plans vary by speed, channel options, and added services.
2. Bundled Services: Customers get discounts when they subscribe to both internet and TV services together.
3. On-Demand Content: They earn from pay-per-view movies, premium channels, and video-on-demand.

Key elements of their business model include:

1. Infrastructure Investment: They invest in and maintain cable networks, fiber-optic lines, and other broadband infrastructure.
2. Content Licensing: They have agreements with providers to deliver popular channels and programs.
3. Internet Services: They provide a variety of plans with different speeds and data limits.

Integrated communications companies provide services like voice, data, internet, TV, and mobile solutions to ensure seamless connectivity for residential, business, and government customers. Here’s how they earn revenue:

1. Subscription Plans: They offer bundled packages of voice, data, and TV for households.
2. Enterprise Solutions: They create custom communication solutions for businesses, including unified communications and cloud services.
3. Government Contracts: They provide integrated communication services to public institutions.

Key elements of their business model include:

1. Network Infrastructure: They build and maintain robust networks with fiber optics, cellular towers, and satellite links.
2. Triple and Quadruple Play Services: They offer bundled packages that combine voice, data, internet, and TV.
3. Cloud Solutions: They provide services for storage, computing, and collaboration in the cloud.

In a market characterized by saturation, disruption, and competition, telecommunication companies have significant commercial opportunities. To succeed, these companies should adopt winning strategies such as:

• Increasing focus on customer-centricity

• Pursuing supply chain and asset lifecycle excellence

• Exploring new revenue streams

• Offering intelligent connectivity

• Embracing sustainable growth.

The telecommunications industry is transforming, driven by escalating network valuations and intensifying competition. To attract investment and showcase network value, telcos are separating into network-focused (NetCo) and service-focused (ServCo) units.

NetCo is a distinct operational unit within a telecommunications company, focused on managing and expanding a network's infrastructure. It allows companies to optimize network resources and make smarter investment decisions. However, embracing a ServCo approach enables long-term customer value, reduces sales and marketing expenses, and fosters sustainable growth – crucial in an era where fiber technology and online shopping are pressuring margins.

Originally driven by regulations, this structural split is now pursued for profitability, as seen with O2 Czech Republic, Denmark's TDC, and New Zealand's Chorus. To support 5G and fiber networks, telcos must redesign business processes and IT systems, boosting agility, cost efficiency, and innovation. Implementing a phased strategy ensures a smooth and effective transition into independent operations.

• Telecommunications value chain includes planning, acquiring, fulfilling, billing, and analyzing.
• Business models vary from subscription to wholesale.
• Success factors focus on customer-centricity and sustainable growth.
• Retention strategies involve structural splits for optimized operations.