‘Conflicting digital needs of GCC users put telecom operators at crossroads’
The changing needs of digitally-active mobile users in the Gulf Cooperation Council (GCC) place telecom operators at crossroads, according to A T Kearney, a global consulting firm.
Highlighting that the digital usage in the Gulf region is well above the European and US average; an A T Kearney report said the broad array of customer demands challenges the GCC telecom operators to make strategic choice.
With the GCC users opting to use apps for calls more frequently than their counterparts in Europe – 76% of the time versus 57% respectively – and nearly double the number using their phones for Internet usage compared to Europe; it said “there is a clear opportunity for the GCC operators to tap into.”
“Interestingly, the profile of mobile users in this region is different than what we see elsewhere. On the one hand, this region has some of the most avid digital users, and yet on the other hand, the users here are less likely than their peers in Europe and the US to make purchases via their phones“, said Marc Biosca, A T Kearney partner and co-author of the report.
Finding that the positive impact regional e-commerce will have on the demand for mobile Internet, A T Kearney’s research found that, one-third of the GCC customers are willing to pay for faster Internet or a more holistic customer service.
“This dovetails with the significant demand for pay-tv and video-on-demand in the region. Currently less than 16% of consumers have these services, but one-quarter of respondents said they plan to buy them in the future,” it said.
The research identified two main factors influencing the GCC users’ choice among mobile providers: network quality (30%) and price (28%). Customer service, security, and sales experience rank far lower. Surprisingly, 20% of respondents said they’d be happy with no customer service at all.
“Operators clearly have a choice to make...Telco operators are at a strategic crossroads and choices will need to be made,” Biosca said.
The key questions before the regional telecom giants are whether they ride the digital wave offering a high-speed quality network combined with digital offerings, or focus on delivering world-class, low-cost, no-frills connectivity services.
They are currently trying to cover all the bases, but becoming a regional cost leader requires up to a 50% reduction in costs and is not compatible with a differentiated, high-quality digital service offering, according to the report.