South African telecommunications service providers need to rethink their approach to the small and medium sized business (SMB) market or risk disintermediation in the future, according to Tim Walter, General Manager for Product and Marketing at independent telecommunications service provider, Nashua Mobile.
Walter calls for a new approach from service providers to the SMB market, citing a number of changes in the legislative, regulatory and competitive environment that must be met.
“Today, most service providers focus only on selling raw connectivity. In a market where operators are looking to directly own their customers bases and where new competitors, such as banks, are leveraging their brands into telecommunications, that is no longer enough”, says Walter.
“B2B customers are looking for a better customer experience from an industry that has been notoriously bad at customer service”, he adds.
The South African telecoms market is undergoing significant changes due to the new Electronic Communications Act, which states that operators are no longer protected under the past regulations.
Walter welcomes the increased competition in the market, such as national backhaul links and international cables where there was little or none before. Players like Dark Fibre Africa are ringing South African cities with fibre-optic cable, others are rolling out fixed wireless solutions such as WiMax and the arrival of Seacom has started to bring international bandwidth prices down, he says.
“To remain competitive in this environment, service providers need to provide individually tailored answers to the issues and queries of business customers of all sizes. As competition heats up, choice and complexity grows, and businesses become more hungry for advice and consulting services”, continued Walter.
Furthermore, competition is turning connectivity into a commodity and margins are becoming thinner, meaning that it is harder to compete on price. Government and the regulator are also pressuring operators to bring their tariffs down, as was made clear in the Department of Communications’ recent interventions aimed at bringing mobile interconnect fees down.
According to Walter, SMBs are looking to service providers to help them find solutions that are perfect for their business needs, and have no interest with being bombarded with technical jargon.
In addition, they are looking for one-stop shopping for a wide range of services such as fixed voice, mobile and Internet access as well as hosted solutions and messaging.
Whatever mix of connectivity products and value-added services the customer needs to address its business needs, these are all available with consolidated billing and a single point of contact for customer service, ends the Nashua Mobile executive.