The mobile telecoms industry is at a crossroads. In a saturated market, increased competition from start-ups and shrinking margins, mobile network operators (MNOs) face a stark reality: for years, they have relied on a simple formula: sell more data and voice at ever-lower prices.
But this model is no longer sustainable.
The aggressive price war between traditional operators – ever more data for ever lower prices – has been a race to the bottom. The simple truth is that the average consumer is no longer interested in paying a premium for extra data they are unlikely to ever.
According to McKinsey, global telecom revenue growth has stagnated at around 2%, with North America barely scraping 1%.
Return on invested capital (ROIC) in Europe and North America has fallen by 10–15% since 2018.
The answer isn’t to sell more data, but to find new ways to add value for consumers.
This will require a radical mindset shift.
The rise of MVNOs: agility and Imagination
While traditional MNOs struggle with the weight of their legacy infrastructure, a wave of upstart Mobile Virtual Network Operators (MVNOs) is reshaping the landscape.
They aren’t selling gigabytes; they’re selling experiences, tapping into a growing demand for simplicity and personalisation by offering tailored services, such as subscription bundles that cater to Gen Z and millennials, or travellers and expatriates seeking eSIM-based, contract-free plans.
They are succeeding because they understand that consumers no longer view telecoms as just a utility, they are succeeding.
MNOs must heed the lesson: success lies in becoming something more than a mere provider of mobile services, but to evolve into comprehensive digital lifestyle partners.
This means diversifying offerings beyond voice and data into areas like broadband, content services, smart home technology, and even energy.
Hybrid monetisation: the key to profitability
A good example of this shift is the growing trend of “speed-based” pricing, where customers are charged based on the speed of their internet connection rather than the amount of data they consume.
In countries like Norway, Switzerland, and Finland, where speed-based tariffs are popular, MNOs have seen higher average revenue per user (ARPU) growth compared to those relying on traditional data-heavy plans.
More importantly, MNOs need to think about how they can make customers’ lives easier and more enjoyable through bundling.
Consumers want simplicity, and bundling services like mobile, broadband, OTT content, and IoT solutions into a single, easy-to-manage package could be the answer to reducing churn and boosting ARPU.
The importance of AI and personalisation
In this new era, AI and data analytics play a critical role. The ability to personalise services in real-time, based on customer behaviour, is becoming a key differentiator.
Research by McKinsey’s shows that organisations that leverage customer behaviour insights outperform their peers by 85% in sales growth.
In the telco world, this means using AI to create smarter, more personalised bundles that meet customers’ specific needs, based on factors like usage patterns, preferences, and even geographic location.
AI-driven personalisation can be applied across the entire customer journey—from onboarding and billing to content recommendations and customer support. AI can also reduce service costs by automating routine processes and improving customer retention.
But, success doesn’t come from simply pouring millions AI agents into broken BSS systems and hoping for the best.
To succeed with AI, even in the short and medium terms, MNOs need clean, coherent BSS systems, with the right, real time data.
This way, AI can be used wisely, efficiently and cost-effectively, rather than as an exercise in hiding bad processes and selling AI as a gimmick.
Getting it right, from day one
Ultimately, the telco industry’s survival depends on its ability to adapt to the changing needs of their customers.
By moving beyond commoditised data and voice services, and by embracing innovation, MNOs can find new ways to stay relevant in an increasingly competitive market.
The telco renaissance is not just about selling data – it’s about becoming an indispensable part of customers’ digital lives, and having the right data and platforms to get it right, from day one.
