Going into 2023, telecoms operators worldwide can be heartened by the collective resilience they’ve shown amid the recent geopolitical and economic turbulence. In the past two years, a combination of price increases, M&A deals and government intervention has helped share prices across the global telecoms sector broadly recover from the lows they touched during the pandemic — although the rebound remains gradual and uneven.
Fast-forward to today, and telcos are refreshing their strategies to navigate a volatile operating environment. They’re expanding the scope and ambition of their digital transformation initiatives. And they’re refocusing on sustainability, including seeking to improve workforce diversity and inclusion (D&I) and attract new talent.
But are telcos sufficiently attuned to the current and emerging risks confronting them to achieve these goals? Amid a high inflationary environment — pushing up operating costs — telcos must also deal with a range of challenges from customers’ cost-of-living pressures, to evolving expectations around security, to changing perceptions of workforce culture — the threats being faced are both urgent and diverse.
In this article we look at the top 10 risks we’ve identified across the sector and consider how to mitigate them.
1. Insufficient response to customers during the cost-of-living crisis
The cost-of-living crisis is causing households to reevaluate whether they’re getting value from their telecommunications providers. The EY Global Decoding the Digital Home Study shows that 45% of households believe they overpay for content services, and 44% think their broadband provider doesn’t do enough to direct them to the best deal. And some regulators are demanding that telcos do more to offer “social tariffs” to improve affordability.