Telecommunications: Understanding the B/OSS Ecosystem
Constantly evolving consumer needs are driving business models to take a customer-centric approach in their effort to provide a seamless omnichannel experience, CX enhancement, real-time decision making, precise marketing, operational efficiency, data monetization and personalization. CSPs will no longer solely provide telecommunication services but rather transform into digital service providers providing a suite of services including IoT and OTT.
The evolution of communication service providers toward becoming digital service providers seems like a monumental task with the extensive changes required in OSS/BSS. But if there’s one thing we learnt from Mobile World Congress is that telecom companies are prioritizing replacing their legacy OSS/BSS systems to deliver more agile services and better customer experiences. To realize 5G’s full potential, it is imperative that CSPs change their operational and business support systems otherwise known as OSS/BSS.
The current OSS/BSS market is worth close to $19 bn and is expected to increase by a CAGR of 3-4% to touch $23 bn by 2025. Close to 70 percent of revenue from 5G use cases is dependent on OSS/BSS transformation. OSS/BSS also accounts for over 70% of the total Telecom headcount at service providers such as TCS, Infosys, and Tech Mahindra.
The OSS/BSS market is fuelled by activities that fall under revenue management and service assurance. Revenue management accounts for nearly 50% of the revenue share under the BSS market while service assurance holds over 65% of the revenue under the OSS market. Other integral functions include customer management, product management, network design and service fulfillment.
The OSS/BSS market is primarily dominated by five vendors – Amdocs, Huawei, Ericsson, Netcracker, and Oracle. Together, they hold over 60% of the market. Amdocs, however, holds the largest share in revenue with over 3.86 bn generated in 2017. Amdocs, Huawei, and Ericsson offer services such as billing management, revenue management, and full suite managed services which can be integrated with cloud that decreases operational costs.
Analytics, COTS implementation and Cloud Engineering are some of the key service opportunities for telecom service providers and vendors. OSS offers significant opportunity in a wide range of business areas including assurance, fulfillment, operations, strategy and infrastructure. BSS can also cash in opportunities in these segments through functions such as product management, customer management, and billing services. Top vendors such as TCS, Infosys, and Tech Mahindra offer solutions in these business areas to global to telecom giants such as AT&T, Vodafone and Sprint.