Regional Service Providers take connectivity to the most remote areas and promote competition in overlooked regions, playing a key role in making digital resources universally available. At times, they are the single player in areas of limited demand, where they struggle to make investments viable. On other occasions, they fight against hefty players, positioning themselves as a local alternative with focus either on quality or affordability.

Whatever their competition reality, the same market forces that are disrupting the business of global tech giants will inevitably come for them. Although these regional companies may not have large resources available to understand and plan for the new challenges, they can benefit from a much more agile decision-making process, moving swiftly and effectively to explore new opportunities and mitigate threats.

Here are some of the market forces that cannot be neglected:

5G will be a game-changer, transforming the market way beyond mobile network operators. It will enable new parameters for user experience, boost IoT and drive new applications. Fixed-mobile access (which cost viability is still controversial) may bring new competition for broadband where customers had no prior choice, pushing regional incumbents to reposition their value proposition. It will also create a massive demand for mobile backhaul bandwidth.

Cybersecurity concerns are changing how technology services are bundled and delivered. Tier-1s are integrating Managed Security Services (MSS) in their connectivity offers for business customers (Firewall, IPS, IDS, Anti-DDoS, endpoint security). Such bundling practices may become the market norm, as CIOs increasingly indicate data protection/integrity and business continuity as a top priority for their offices. Keeping competitive in business services will require regional providers to develop a new skill set to offer MSS, which may involve virtualizing security network functions.

IoT will reshape several industries, bringing vast opportunities to service providers. Being industry-specific, it will require new vertical expertise to sell and serve business customers, and new partnerships to integrate devices and analytics in the services package. It will also prompt new technologies, network topologies, computing architectures, systems and service practices that may redesign the way many technology service providers are organized.

Big Data and Analytics will mean new ways for smart regional service providers to add value to local businesses. Edge Computing will boost the value of their operational sites as potential computing facilities, though it may attract outsiders of the tech industry to provide this scattered infrastructure. The Digital Experience users enjoy at cloud-based online services is becoming a pre-requisite for any service offering, and providers will need to evolve to deliver the visibility, control, and flexibility that becomes the qualifying minimum to be considered by customers. And the consolidation of the cloud culture of Everything-as-a-Service creates a myriad of new areas for service providers to position themselves as regional technology leaders integrating far beyond connectivity.

How to thrive on Digital Disruption

Wherever trends may lead the market, it is certain that deep changes are coming to regional service providers, and the key to survive and win in this market will be the ability to adapt.  There is no miraculous solution for service providers to address these transformational challenges, and it gets even harder for smaller companies, as many helpful innovations take time to become cost-effective for regional deployments.  For example, it may still take a couple of years for NFVO and network automation to become widely viable for mid-tier networks. However, there is a lot regional service providers can do now to prepare for the upcoming disruption.

The key is to develop adaptive capabilities to quickly and flexibly respond to demand and competition shifts, being able to seize the numerous opportunities that will come to those who are equipped. Every investment must be made in tune with the guiding principle of adaptability.

The key is to develop adaptive capabilities to quickly and flexibly respond to demand and competition shifts, being able to seize the numerous opportunities that will come to those who are equipped.

The future is built now. Start by calibrating your RFPs to prioritize open solutions (broadening alternatives to interoperate and manage in the future), favor programmable infrastructure (preparing for progressive degrees of automation as they become viable), and facilitate intelligence (software and analysis tools). These criteria will not only extend investment’s longevity, future-proofing them for a wider range of scenarios, but also empower providers to be nimble and position for growth. Want to thrive on digital disruption? Prepare to adapt!

The Adaptive Network - Mastering Complexity video