CSPs are targeting enterprises, but do they really know what they want?

CSPs enterprises

A new report from Analysys Mason and CSG found that digital transformation plans among most enterprises are accelerating, as are plans to increase cloud security spending. That would be good news for CSPs targeting the enterprise sector, except that most enterprises aren’t coming to them for cloud or digital services. There’s a couple of reasons for that: (1) selling to enterprises is a complex undertaking, and (2) enterprise service demands are too complex for most existing CSP billing systems.

According to the report, enterprises mostly see CSPs as connectivity providers. Only 25% of enterprises surveyed said they bought IT-related solutions from CSPs.

A key reason for this, says Ian Watterson, head of Asia-Pacific at CSG, is that most CSPs are set up to sell B2C services, but those skills don’t translate well to B2B scenarios.

“There’s a different approach to bundling and packaging things like cloud services, security, Microsoft 365 services, and then you have that stratification of large to medium to small enterprises, which means that CSPs also need to think about where they’re going to target and what offers they’re going to offer to each of those markets,” he says.

That’s mainly down to a lack of experience in the enterprise marketplace – Watterson recommends CSPs form a dedicated and driven enterprise team to focus on that segment.

A more formidable barrier to entry is CSP billing systems – which is ironic, given that billing is arguably the other major thing CSPs are good at besides connectivity. But according to the Analysys Mason report, while telco billing systems can meet current enterprise demand for billing and invoicing services, “it will be more challenging for them to meet future demand as more products are delivered ‘as-a- service’.”

Put simply, telco billing systems aren’t designed to handle complex enterprise services at scale.

Source: Analysys Mason and CSG,
“Large enterprises’ demand for communications and IT services: survey results 2021”

But that doesn’t mean CSPs have to resign themselves to being fat pipes just yet. The rise of 5G and IoT create tremendous opportunities for CSPs to add value to connectivity by bundling services with connections leveraging 5G features like bandwidth slicing and edge computing, Watterson says.

Moreover, upgrading their billing systems would not only enable them to handle the scaling complexity of enterprise services, but also to monetize billing as a service in its own right.

“When you look at something like smart agriculture, that’s not necessarily the CSP selling to farmers – that’s the CSP selling to some intermediary agent who then offers that as a service,” Watterson explains. “That intermediary agent is likely not to have the dynamic billing capability that they need in order to be billing all those thousands of farms, but the CSP does.”

That’s also good news for vendors like CSG who are already helping operators to use their strengths to capitalize on the enterprise opportunity to the fullest, Watterson adds.

“We’ve been around for 35 years, so we bring that to operators, and we’re be able to show them what we’ve done for other customers … and even advise them on different elements that are not part of our spec. We are able to show them what we’ve done for other customers and advise on different elements.”

The full report can be downloaded here.

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