The operating model for telco operators has become extremely complex and has undergone tremendous change in the past few years. To meet surging demand for better customer experience, telcos need to continue investing in network infrastructure. However, revenues are not expected to grow at the same rate of spending. With traditional businesses declining, the threat from over the top (OTT) business models from the Internet and device players are forcing telcos to rethink their revenue model. In order to achieve faster growth, telcos have to focus on building stronger partnering & integration ecosystems with digital service players. Such partnerships can enable them to become a marketplace to sell their own as well as non-telco products, thereby increasing revenue and enhancing customer experience.
For several years, companies have used APIs to exchange information between IT systems. However, what is novel now is the way they are being used. Today’s billion-dollar valuation companies do not own huge assets but still have been able to achieve such high valuations by building an ecosystem primarily by exposing APIs. These ecosystems are used to connect end-users and sellers of different products or services thus assisting in attaining high customer experience and satisfaction. Using the same approach, telcos now want to become ‘Open Telcos’ through the adoption of open APIs to allow third-party developers to build services that hook into telco networks.
‘Open Telcos’ are part of digital initiatives that most telcos are undertaking as they enable them to deliver what customers want, when and where they want it. It helps partners to consume data from their internal systems to be able to create dynamic services. Telcos drive monetization through increased usage of services, and adoption of APIs can create an innovative ecosystem of independent software developers that, in turn, drives new business development.
Step 1: Define API business strategy
Once the API strategy is defined, the next step is to identify what capabilities or functions need to be published for consumption by the internal or external ecosystem. Service providers tend to make these decisions based on their digital The first step for any service provider is to define the business goal they want to achieve by the adoption of ‘Open API’. Service providers can publish API either to be used for internal organization to increase efficiency, build mobile apps, etc. or for external partners to be able to cross-sell or upsell products, thereby monetizing the APIs.
Step 2: Define functions or capabilities to be exposed roadmap. Few options that service providers can use to identify capabilities to be exposed are:
- Better customer experiences by enabling customer interaction either through mobile apps or portals
- Integrate with partners to be able to cross-sell or upsell their products and share information like product catalogue information, product bundling recommendations, loyalty management, promotions etc. or as part of the customer order fulfillment journey, and share information like appointment, shipment tracking etc.
- Network-based functions like network availability, usage consumption etc.