XaaS Pricing: How Telcos Can Capitalize on the SMB IT Space in 4 Steps

Solutions Review’s Expert Insights Series is a collection of contributed articles written by industry experts in enterprise software categories. In this feature, CloudBlue Global Director Joan Puyol offers an overview of XaaS pricing, with commentary on how telcos can capitalize on the SMB IT space with ease.

As telcos strive to diversify their offerings, selling digital solutions to their huge base of small and medium-sized businesses (SMBs) becomes essential. Research shows that IT spending among SMBs is expected to keep growing by double digits – reaching roughly $1.5 trillion this year. Telcos are laying the groundwork to capture that opportunity. In our whitepaper on the subject, we take a look at how top telcos are enhancing their services, staying competitive, and building a solid SMB customer base.

XaaS Pricing

From Connectivity to IT Digital Solutions

Over the past decade, telcos have been under increased pressure to reinvent themselves as Digital Service Providers (DSPs). This evolution enables telcos to compete to be the provider of choice for software-as-a-service (SaaS), security-as-a-service (SECaaS), and infrastructure-as-a-service (IaaS).

Automation of the whole supply chain is key to this transformation, emphasizing standardization and zero-touch scalability. It entails catalog expansion, global marketplaces, everything-as-a-service (XaaS) bundle management, and hybrid cloud technology.

Target Investments

Focusing on their SMB base allows telcos to take advantage of three distinct markets – cybersecurity, Cloud services, and the internet of things (IoT). Telcos aiming to thrive in these markets have used a two-prong approach by freeing up cash and then re-investing it into low-latency infrastructure (fiber optic network and 5G) and cloud services companies.

For example, Verizon sold off its media properties and focused instead on its wireless networks and other internet provider businesses. With newly freed-up funds, telcos can move to expand their business model as technology providers.

As DSPs, telcos can focus more effectively on creating customer stickiness and deepening per-customer contracts with bundled services. Business customers want solutions at their fingertips. To keep up the momentum and gain a competitive edge, telcos must simplify, standardize and digitize their entire business model.

Expand their Catalog

The first step to selling, cross-selling and up-selling service solutions is to expand the catalog offering and integrate more third-party solutions and collaboration. It’s essential for telcos to create a simplified system through end-to-end automation of ordering fulfillment and billing of subscriptions with global software vendors.

Managing an expanded portfolio manually drains time and increases costs because every vendor requires a dedicated integration, while every subscription model is different. An experienced platform provider can eliminate these pain points.

Develop a XaaS Marketplace Storefront

A global self-service marketplace platform that automates all ordering, fulfillment, and billing processes. It also provides a unified view and data integration that improves visibility and workflows.

By publishing an expanded catalog in XaaS marketplaces, telcos can gain business scalability as customers or branches in different locations utilize this self-service storefront. In addition, local subsidiaries are then able to manage their quotes and regional catalogs while the service component is handled centrally. Scaling these processes with digitization is critical to reduce costs and freeing up resources.

Forming Product Bundles

The next step in the process is for telcos, as DSPs, to double down on XaaS bundles. This simplifies their SMB customers’ operations while improving customer relations.

In the B2B space, this means offering all-inclusive contracts in the form of cybersecurity, productivity, collaboration or networking packages. A prime example is Telefonica Tech of Spain, which offers a cybersecurity package that includes a physical firewall, SaaS licenses, and professional setup services – all available to order through their marketplace as a single solution and delivered at a monthly fee.

The more telcos invest in automation, the more opportunity they have to personalize solutions through automated deployment of packages for their customers, such as a complete workplace-as-a-service.

Multi-Cloud Orchestration Matters

The fourth step to remaining competitive in the SMB IT space is to focus on a hybrid cloud approach by developing the necessary tech infrastructure. According to Gartner, about 75 percent of enterprise customers using IaaS have adopted a multi-cloud strategy.

Cutting-edge telcos are now experimenting with complex solutions involving automated application deployment. For example, we’ve seen website-as-a-service offerings, where a fully automated virtual server is deployed using scripts and is ready to be used by the SMB in a matter of minutes for a monthly fee. Multi-cloud orchestration enables fulfillment and deployment of complete hybrid cloud solutions, enabling customers to personalize their cloud service package.

Simplified Solutions Through Automation

An end-to-end cloud software and services platform help businesses bundle, scale, and sell solutions and digital services. Partnering with a platform provider allows telcos to seamlessly transform their e-commerce shops into XaaS marketplace ecosystems. The platform provider handles all the ordering, fulfillment, subscription management, and billing flows.

Telcos that thrive as IT services providers are able to adapt to market simplicity. They can become fully-fledged DSPs ready to scale by broadening their catalog and offering a wide range of third-party solutions. They must also invest in end-to-end automation, offer product bundles and utilize the hybrid cloud.

The modern telco service provider understands the need to grow their revenue and increase their share of the XaaS subscription service economy. This calls for standardization, simplification, and digitization of their SMB customer business model. Automation is mission-critical to this type of business transformation.

How Telcos Can Capitalize on the SMB IT Space in 4 Key Steps