Students of business understand the basic stages of the business life cycle – introduction, growth-expansion, maturity, decline, and exit. Where is the 2016 wireless industry in this business life cycle?
The U.S. wireless industry has enjoyed tremendous success since cellular services were introduced just over 30 years ago. The wireless industry has “lived” in the growth-expansion business life cycle stage during much of this time. New technology, new spectrum, and competition have fueled that growth – just ask yourself where the wireless industry would be today if it hadn’t evolved from AMPS, 50 MHz of cellular spectrum, and market duopolies? Indeed, life has been good for most everyone fortunate enough to work in this industry over this time.
Arguably, the wireless industry has moved to maturity business life cycle stage over the past several years. Carrier year-over-year sales and profits tend to be stable, however competition remains fierce. Regulators and content providers threaten to further disrupt the industry. Customers demand larger data bundles, but aren’t necessarily willing to pay more. It’s not a stretch to foresee carriers challenged with declining revenue growth in their core wireless business. Network reliability must be maintained, or improved. Carriers must cut costs in order to sustain profitability and cash flow. Carriers are searching for new opportunities and businesses (e.g., AT&T acquiring DirecTV, Verizon acquiring AOL), while focusing on management efficiency in their core wireless business to extend the maturity stage of the business life cycle.
The state of the 2016 wireless industry is strong! But, the clear implication is the wireless industry must evolve to continue to thrive. The tried and true approaches of the last 30+ years to planning, building and operating wireless networks have fueled the industry’s success through the growth-expansion stage, but applying the same approaches in the maturity stage will hasten the industry’s transition to decline. While carriers continue to leverage new tools like small cells, new technology like 5G and SDN/NFV, and new spectrum, they will also relentlessly evolve their business processes and pursue new approaches to take costs out of the business.
Successful suppliers to the wireless carriers must also evolve – carriers will demand it. Signal Point Systems stands prepared to help our wireless carrier partners evolve and ensure life will be good for everyone fortunate enough to work in this industry for the next 30 years. Follow us for our future thoughts on how we can help you succeed.