Rigas Parathyras
Vice President of Products
Tower company business models have already proven extremely successful in the telecommunications ecosystem. But operating a towerco is not without its challenges. In this blog, Rigas Parathyras, ZIRA’s Vice President of Products, explores the reasons behind towercos’ success, and the opportunities – and difficulties – it brings to business leaders.
The golden age of delayering
The last decade has been nothing short of revolutionary for the telecommunications ecosystem. The arrival of reliable 4G data and the rise of cloud-hosted services challenged the monopoly of telecom providers on services like calling and messaging. As TM Forum’s latest report puts it, ‘telcos, disintermediated by OTT players, were relegated to the role of data pipe in the 4G era’.
Faced with rapidly changing customer demands, the rising cost of capital, and fierce competition from within and even from outside the industry, service providers continue to look for new ways to optimize their business. For many, separating large providers into leaner, laser-focused divisions has provided the answer, and thus, vertically separated units (servcos, netcos, and infracos) were born.
Considering the advantages of delayering, the popularity of this approach is not surprising. Reevaluating operational structures in this way not only increases operational efficiency but also liberates capital and increases telecom companies’ ability to invest in next-generation connectivity and corresponding enterprise use cases like IoT.
The towerco opportunity
Importantly, these carved-out assets are also more attractive to investors due to their efficiency and exclusive focus on one aspect of telecommunications, resulting in a flow of cash into these businesses. This was the case of Vantage Towers, whose market capitalization was 50% higher after separating from its owner, Vodafone.
As a result, even a few years into the delayering trend, tower companies continue to enjoy great popularity, which is also due to the uniquely effective operating model they offer to MNOs working with them. Indeed, towercos can operate locations around 40% more efficiently than a traditional telco, making them attractive partners.
As well as profitability, towercos’ business model also allows them to focus on finding more innovative solutions within the segment, maintaining growth and helping partnering companies retain a competitive edge.
As the number of operators looking to outsource their infrastructure rises, the circumstances are ripe for tower companies to grow, increasing their partnerships and revenues.
But they need to be prepared.
Towercos can operate locations around 40% more efficiently than a traditional telco.
Challenges on the path to growth
While their evolution from traditional telecom companies made towercos more efficient by allowing them to focus only on infrastructure, it has also left them vulnerable to the many challenges they can face as a standalone business operating in a complex model.
Tower companies must be able to:
- Operate multiple tenancies at one site
- Support complex business models
- Carry out elaborate quotation processes with a high number of variables
For traditional telcos, these processes are supported by a BSS system that can manage partnerships, customer and service orders, and products and services. But these systems, however effective, were not designed to handle the complexity of a tower company’s operations.
To maximize efficiency and successfully implement profitable partnerships, towercos require dedicated BSS solutions that suit their needs. Otherwise, manual workarounds and patches will lead to substantial and unnecessary investments of time, effort, and money, chipping away at the very efficiency that makes towercos so profitable.
What can BSS do for tower companies?
Armed with a purpose-built BSS solution, towercos can take full advantage of the business opportunities available to them. With a wide range of helpful features, towercos can benefit from:
Here’s a detailed look at how a specialized BSS solution can transform the way tower companies operate:
Enhanced operational efficiency and flexibility
The introduction of a BSS tailored for tower companies can streamline the entire lead-to-cash process, automating and refining every step from the initial customer engagement to the final transaction. This includes order capture and order management, where the systems efficiently handle incoming requests and process them through to completion.
By seamlessly integrating OSS (Operational Support Systems), BSS, and ERP (Enterprise Resource Planning) systems, tower companies can ensure that data flows smoothly across different network segments. This integration is crucial for developing next-generation networks that require the coordination of complex and multiple operational processes.
Improved customer experience
BSS solutions enhance customer interactions by providing robust order capture and management capabilities. These systems enable tower companies to quickly respond to service requests, ensuring that all customer needs are addressed promptly and accurately.
This not only boosts customer satisfaction but also strengthens the company’s commercial relationships by showcasing its reliability and responsiveness in handling customer demands.
Advanced revenue management and cost optimization
Effective BSS implementations allow tower companies to optimize their billing and financial operations, ensuring that all services rendered are appropriately invoiced and paid. This includes the ability to accurately manage and pass through charges, which is essential for maintaining healthy cash flows and minimizing revenue leakage.
Moreover, the capacity to closely monitor and adjust costs associated with network maintenance and expansion is key to sustaining long-term profitability.
Supporting complex business models
Tower companies often operate complex business models that require managing multiple tenancies and intricate contractual agreements. A dedicated BSS platform supports these multifaceted models by enabling detailed and flexible quotation processes, essential for crafting tailored service offerings.
Furthermore, the BSS aids in managing the lifecycle of these contracts, from inception through renewal or termination, ensuring that each partnership is handled effectively.
Strategic asset management
By leveraging BSS solutions, tower companies can better manage their physical and network assets, turning each property into a profitable venture. These systems provide detailed analytics and reporting tools that help identify performance trends and operational efficiencies, critical for making informed decisions about asset utilization and future investments.
Incorporating these capabilities allows tower companies to not only streamline their foundational operational processes, but also to adapt dynamically to the evolving telecommunications landscape. As a result, they can continue to thrive by maximizing the efficiency and commercial potential of their business model, ensuring long-term success in a competitive industry.
Maximizing efficiency with BSS for tower companies
- Want to learn what BSS can bring to your tower company?
- Curious how BSS for tower companies can deal with multiple business models, aid build and lease processes, and help maximize tower tenancy?
- Want to know how BSS streamlines agreements, CPQ, and billing processes?
Conclusion
In the current communications ecosystem, everything is set up to support tower companies’ growth, from continued delayering to most MNOs’ endeavour to focus on innovation rather than day-to-day infrastructure management. To make the most of the soaring number of possible partnerships and maximize revenue, towercos should invest in a BSS solution that enhances their efficiency, rather than curtailing it.
An integrated, modern, modular BSS for tower companies like ZIRA’s can provide them with the customer and partner management, billing, and order capabilities they need to provide excellent service, without compromising on the flexibility that makes their business model uniquely profitable. This way, they can continue building on their success for many years to come.
