Friday, June 26, 2009

Cellular Operator: Possible cost cutting

This writing would be most ideas how to increase revenue, by implementing eficiency and efective strategy in telco industry competation. I repost this writing from Mas Joko from this link, while he is a professional in telco industry in Qtel.

Cellular Operator: Possible cost cutting

Quoting from mobile communication magazine, some possibles areas that cellular operator maybe able to do some effiency in this very tight competition and tendency on price war:

1. Network infrastructure sharing
Good idea, but it doesn’t seem easy to implement, especially when the two of operators been fighting fiercely in the market share. Cost wise, it is making sense!

2. Cut or reduce handset subsidies
In some countries, handset subsidies still seen as one of important way of subscriber acquisition and retention as well and still har habbit to break, even the subsidies cost hundreds dollars per unit and keep carry on for the new handphone models.

3. Network Outsourcing
The new trend for operator is outsource or purchase manage service for their operation that probably several years ago were oppossed by the operators. The purpose is for cost efficiency, not to eliminate the problem of operations or network.

4. Consolidation
We have seen the operator Merger and Acquisition, so the M&A is for consolidation not the guarantee for success, still a lot of factor over there in the market.

5. Headcount reduction
One of the area for cost efficiency, but operator must doing it carefully. Area of improvement maybe by reducing high cost expats :)

6. MVNOs and customer selection
Consider as one of the approach, better sell wholesale airtime to MVNO rather than no sale :) or probably like Blyk business model.

7. Marketing and sponsorship
We have seen, that some operator massively throws their money into something we can not measure directly, e.g in Formula One racing. There was an bad impact where the are some event that may damage the brand as well. I this example take Vodafone with Ferari, when Ferari team order to Barichelo to gave away his position to Michael Schumacer, and Vodafone have to reply to angry user who were not agree with the unfairness. So operator have to be very carefully on the selection of marketing event.

8. Revenue Assurance and Fraud,
This real fact that everyday and second, operators may have some leak by inaccurate billing and rating, unbill customer or roaming, fraud internal and external or in some prepaid or postpaid network freezing

9. Off-shore call centres,
The recent trends in finance and IT industries, including telco’s to shifting expensive and labours intensive call centres to cheaper company/outsource.

10. Distribution and e-tailing,
Maybe operators have to asses and deploy this wisely, while in some low end prepaid, it’s become common to stock mobile phone and reload or selling starter pack while for some postpaid user and high profile still needed to have face to face customer representative

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hello guys