The telecoms industry is moving at an unprecedented pace. We only need to look at the sheer number of partnerships being made and accelerated technological innovation to see this. So, as the sun sets on 2024, we look ahead to next year and the trends and dynamics shaping UK telecoms in 2025.
Consolidation set to continue
While the dominant forces of our industry, such as Openreach, have made strides in recent years - such as significant advancements to national full fibre rollout plans, they have numerous other priorities, not least the PSTN switch-off in January 2027. While this is happening, altnets have been making moves.
Consolidation is happening in the only way it can, through aggressive M&A and investor consolidation. The merger between Netomnia and Brsk, perhaps the most significant example to date, combined 1.5 million premises in one fell swoop. Equally, news of CityFibre’s acquisition of Lit Fibre recently added 300,000 premises to its 8 million rollout plan. There is also the consolidation of the All Points Fibre Network, led by Fern Trading - part of Octopus Investments - that resulted in FTTP broadband ISPs Jurassic Fibre, Swish Fibre, Giganet and AllPoints Fibre combining as one.
I expect consolidation will continue in 2025, as altnet organisations seek increased premises, easier facilitation through combined tech stacks, as well as being able to compete with competitor M&A and the forecast price competitiveness consolidation will inevitably bring.
Price and service competition will increase
Customers' provider choices will narrow as the Channel vies for market dominance. As it does, provider competition will increase. Not only will this increase investment in technology and service - the pillar of a positive customer relationship is providing them with the robust, unwavering service they require - but it will also appeal to the customer’s pockets.
We’re likely to see an intense pricing battle in 2025, with each organisation looking for ways to operate at the same standards for less, to provide services more cheaply. The hopes for this will be greater customer retention and increased net new customer growth. What will be interesting to see is how the customer reacts to this. Price differences will be slim, and perhaps slimmer than service standards, whether service or price is prioritised remains to be seen.
Resolution and retention relationship
On the topic of customer retention, the telecoms industry aims to resolve customer issues as effectively and efficiently as possible. While effectiveness is standardised, it’s efficiency from the operational side that can be improved.
Market leaders are already producing better resolution processes for themselves and their customers. Harnessing the power of AI, predictive analytics and automation to fulfill this objective will become commonplace throughout 2025.
Resolution processes will be able to perform automated identification of service issues, real-time assessment analysis to get to the root of the problem and source smart insights post-diagnosis into how the issue can be resolved most efficiently. Ultimately, it will decrease friction between supplier and customer, whose issue is resolved faster and with increased communication. It will also lower provider costs and resources, as they can gather intelligence quicker and with more detail and then take the most suitable course of action.
In doing so, we’ll see the trust between customer and supplier increase in 2025, should a business spend time getting resolutions right.
Driving growth through monetisation
Changes to the way telecoms organisations operate, from more complex products, hybrid approaches such as those combining subscriptions and event rating, or trends toward cloud services, our industry will have plenty to keep them busy.
A gap will emerge between traditional monetisation providers and those that have invested in services designed to meet the needs of the modern telco, ISP or MSP. Again, partnerships and technological innovation will be key to enforcing a more streamlined approach. Of most note, customers will seek speed and safety.
It’s estimated that UK business loses 2 per cent of revenue to fraud every year. Sadly, our sector is no different. However, some monetisation providers have started to partner with verification and fintech services that reduce payment failures, recovering as much as 70 per cent of declined payments, while offering almost real-time capabilities.
We’ll see providers that have already achieved, or will very soon, a more supported, robust monetisation platform with analytics and industry-leading UX trump the competition. Simplified, powerful monetisation services can encourage the growth of our industry, reduce time and resources, unlock previously lost revenue opportunities and, ultimately, become a catalyst for growth, not an impediment.