The relationship between telcos, CEM and RCS

By Doug Mohney November 14, 2013

Ovum this week said customer experience management (CEM) has emerged as the top driver of telco experience management ni 2014. Analysts believe telco IT spending will reach $60.7 billion by 2017, with investments in infrastructure and online channels to support customer's digital lifestyles. Why do I think RCS fits into this picture? Owning the customer is key, something you don't get with OTT.

The ICT Enterprise Insights survey reveals what Ovum says is a "long-term shift in spending towards customer-oriented systems and on improving customer satisfaction within the telecoms industry."  Multi-channel integration and service personalization are top areas of focus in the next 18 months, with more advanced analytics going in at the network level to offer an "enhanced connected experience, with predictable, consistent, and relevant services at each point of interaction in the customer lifestyle."

A lot of this all ties into back-ends systems and data crunching that the customer won't see, sifting through demographics and statistics to tailor service plans for squeezing more ARPU (average revenue per user) upward. 

 The key to all of this is customer relationships. Phone companies (finally, belatedly) realize that IP services -- specifically over-the-top (OTT) offerings -- weaken and dilute their relationship with customers. Voice revenues have declined across the board, SMS text is no longer the cash cow it once was and has started to decline, and everyone talks up video on mobile devices.    The smartphone experience as embodied by the Apple iPhone and Android only hastened the divide.

Telcos want those customers and their ARPU back in the fold. Service providers realize revenues can't go up like they were in the old days of SMS text and higher rate per-minute voice calling, but they can certainly provide bundles, priorities, and/or discounts on services they control and manage.

Enter Rich Communications Services (RCS), the telco industry's tool to slowly rollback OTT and bring customers back into the fold.   Carriers are already starting to deliver RCS services in around the world, taking advantage of the fact they can pre-load RCS clients on handsets to provide a convenient "on ramp" people can try. MetroPCS (now T-Mobile US) and Sprint have rolled out RCS services in the U.S. while the joyn RCS option continues to proliferate at powerhouses such as Deutsche Telekom and Telefonica.

Use of RCS provides precision data to telcos on what customers are doing, be it person-to-person text messaging, group chat, voice, or video calling. That data can be readily rolled into a CEM process in order to fine tune bundles and special offers. A RCS API can be used to generate hooks into customer service -- and seriously, when have you seen notable customer service from an OTT? -- for resolving issues.

Bigots opposed to RCS scream loudly that because it is a "telco" offering it will never work, but if you filed off the telco label, I suspect they would have little to complain about and some things to endorse. As mentioned above, an API can be used to build more customized applications -- most OTTs are closed islands and have little desire to promote third-party development. Self-discovery of other RCS users is a decent feature and being able to build a large pool of RCS users across carriers shouldn't be overlooked.

Edited by Cassandra Tucker

Contributing Editor

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