WEBINAR

The B2B opportunity

in the 5G era
Are operators moving outside
their comfort zone?
DATE
27 May 2020
 B2B revenue: how far have operators gone?
Agenda 15
mins
Pablo Iacopino, Director of Ecosystem Research
GSMA Intelligence

Operator B2B plans & strategies: what lies ahead?

15 Yiru Zhong, Lead Analyst, IoT & Enterprise
mins GSMA Intelligence

Fireside Chat
15 Jennifer Didoni, Head of Cloud Portfolio
mins Vodafone Business

15 Audience Q&A
mins
B2B revenue: how far have
operators gone?
Presented by Pablo Iacopino
 B2B is not new to operators
The 5G era, however, is driving renewed interest

Operators: incremental revenue from 5G – CEOs speak

% of respondents
Digitisation of enterprises and industries
Enterprise 69%
Immersive Live in-venue
FWA
Consumer 23% reality entertainment

Gaming & Enhanced video

eSports streaming
Government 14%

0% 20% 40% 60% 80% 100% Tourism Education

Public
safety
Most important Somewhat important Smart
Neutral Not very important Healthcare
cities
Least important
Source: GSMA Intelligence. Based on global survey of operator CEOs
 What’s B2B revenue?
Core communications and new areas of growth
B2B services: key areas

Cloud, Edge, IoT, security

Services Big data and analytics, industry applications, professional services

beyond core
Specific solutions for vertical sectors (i.e. automotive, healthcare, utilities,
communications manufacturing)

Media (i.e. advertising, digital marketing, B2B media and entertainment content)

SD-WAN, private networks

MPLS WAN, IP-VPN, leased lines, Ethernet, business communications (i.e.

Core unified communications & web conferencing)
communications Fixed voice and broadband

Mobile voice, messaging and data

 B2B revenue: how far have operators gone?
Different approaches = broad range (30% is the average)

B2B revenue
% of total revenue, 2018

B2B 47% 45% 43% 40% 32% 30% 30% 20% 16% 12%
Softbank

Telefonica
AT&T

Telstra
BT

Vodafone

KDDI

China Mobile
Verizon
Singtel

B2B Other (mostly Consumer)

Source: Company figures and GSMA Intelligence

 B2B revenue: what is the speed of change?
B2B contributions on the rise for most…but slowly
+2pp
B2B
share: +1pp

Change = = = 0pp
between -1pp
2017 and
2018 -2pp

B2B share
of total
operator 47% 45% 43% 40%
revenue 32% 30% 30% 20% 16% 12%
2018
Softbank

Telefonica
AT&T

Telstra
BT

Vodafone

KDDI

China Mobile
Verizon
Singtel

B2B Other (mostly Consumer)

Source: Company figures and GSMA Intelligence

 What drives B2B revenue today?
On average, 60% comes from core communications services

B2B revenue by segment

% of total B2B revenue, 2018

Services 27% 19% 20%

32%
beyond core
57%
communications 71%

73% 81% 80%

Core 68%
communications 43%
29%

Telefonica
AT&T

Telstra

China Mobile
BT

Singtel

Source: Company figures and GSMA Intelligence

 Mapping operators
Share vs. size vs. growth
Softbank
50%
BT
Singtel AT&T
B2B share of total revenue

Leading on size of
40% Leading on
B2B revenue ($ bn)
B2B share of
total revenue
Verizon
30% Telstra Vodafone

20% Telefonica

Leading on B2B
10% KDDI
revenue growth
China Mobile

0%
-6% -3% 0% 3% 6% 9%
B2B revenue - yoy change
Source: Company figures and GSMA Intelligence. Bubble size reflects 2018 B2B revenue
 What drives growth?
IoT, cloud and security: the march to $1 billion

1.8
IoT Cloud Security
1.6
39% 46% 22%
1.4

1.2
US$ (bn)

1.0

0.8

0.6

0.4

0.2

0.0 Telstra

Telstra

Column1
Mobile

Unicom

Unicom
Vodafone

Telefonica

Telecom

Telefonica

Telecom

Telefonica

Orange
China
Verizon

Singtel

Singtel
China

China
China

China
yoy
Source: Company figures and GSMA Intelligence 2017 2018 growth
 B2B revenue by vertical sector
5G and IoT should add impetus to vertical-focused efforts

B2B revenue by
vertical sector

Shares of China IT, Internet 44%

Mobile enterprise Government admin 20%
revenue (core
communications Commerce & trading 9%
and beyond)
Culture & education 7%
H1 2019
Finance 7%
Industrial manufacturing 5%
Transport & logistics 4%
5G/IoT promise
Energy & electricity 3%
Healthcare 1%
Source: Company figures and GSMA Intelligence
 Covid-19 impact?
Operators speak

2020: pressure on B2B revenue Looking ahead: digitisation boost

B2B revenue expectations % of respondents Growth in demand

34% Cloud infrastructure &

31% solutions 35%

5G connectivity to businesses 20%

15% Private wireless networks
(4G/5G) 18%
8% 8%
2% 2% SD-WAN services 11%
1%-5% growth

1%-5% decrease

decrease

11-15% decrease

>15% decrease

Prefer not to
IoT solutions & services 9%
6%-10%
Do not expect a

answer
change

Do not expect growth 3%

Edge networking 2%

Prefer not to answer 2%

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)
THANK YOU!
Pablo Iacopino
Director of Ecosystem Research
piacopino@gsma.com

Get the full report:

Operator revenue
in the enterprise
market
Operator B2B plans &
strategies: what lies ahead?
Presented by Yiru Zhong
 The target B2B segment is existing customers
Upselling is far more important than new routes to revenue

Most important long-term B2B objective

Grow revenue with existing customers 36%

Grow new channels 18%

Create new business models 16%

Develop new industry use cases 16%

Grow new customers 12%

Others 2%

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 More than half of operators are already upselling
Bundling value added services hasn’t yielded results yet

% of operator respondents that currently offer these services

~60% Big ~80% Cloud

Services data analytics ~80% ~100%
~50%
beyond core Security Professional
Edge
communications ~60% services
Applications ~80% IoT

~50% ~60% ~80% ~100%

Core
5G SD-WAN Private Mobile/fixed
communications
connectivity services networks connectivity

50% 100%
Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)
 5G and private networks give new momentum
But will B2B customers be ready?

Timing of new communications services launches

5G connectivity to businesses 47% 43%

Private 4G/5G networks 50% 14% 21%

SD-WAN services 32% 30% 24%

2020 2021 - 2022 2023 - 2025 >2025 Never

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 Verticals are prioritised by upselling potential
Bundling with services beyond core connectivity

Largest source of revenue in services beyond core communications

Manufacturing 27% 28%

Financial services 22% 9%

Ranked 1st
Retail 11% 16%
Ranked 2nd

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 Great ambitions to add intelligence & use cases
While using IoT to drive vertical business outcomes

Services beyond core communications: operators launching in the next 2 years

Big data & analytics 30%

Application development &

28%
services

IoT solutions & services 23%

Cloud infrastructure & solutions 17%

Security solutions & services 11%

Professional services 2%

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 Successful upselling requires a KYC approach
Different use cases require different 5G capabilities

Top three verticals that will benefit the most from 5G capabilities

Financial Public Manufacturing

services sector - automotive

Network slicing Network slicing Network slicing

Edge computing Edge computing
Edge computing Higher data rates Higher data rates
Higher data rates Massive IoT
Massive IoT
Massive IoT
uRLLC uRLLC uRLLC

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 KYC also requires access to new channels
To accelerate achieving existing customers business goals

Types of new partners most crucial to your B2B strategy

Industry vertical specialists 64%

ML/AI specialists 56%

Cloud vendors 42%

Digital marketplace 40%

Industry security vendors 38%

Data aggregators 28%

Developer community 17%

Edge computing vendors 12%

Source: GSMA Intelligence Operator Enterprise Survey (2020; 100 operators)

 Moving into verticals requires significant change
Meeting existing customers’ telecoms, IT and business needs

What lies ahead?

Cloud, edge & Private networks for Small medium enterprises

security verticals vs large enterprises
THANK YOU!
Yiru Zhong
Lead Analyst, IoT & Enterprise
yzhong@gsma.com

Discover our latest Spotlight:

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Fireside Chat
Q&A
 Download today’s research!

Operator revenue The 5G era for operators:

in the enterprise market investing in core networks,
capturing B2B opportunities
March 2020
May 2020

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THANK YOU!