A new study published by Capgemini based on samples in the US and Europe noted that telecom company offerings in six out of nine countries are not in line with consumer needs. It found that 27 out of 48 mobile operators demonstrate a poor Net Promoter Score ranging between zero and negative. Nearly 58 percent of consumers are willing to switch over to a digital-only operator, while 44 percent of them might eventually shift to the likes of Google, Facebook, or Apple when they offer mobile services in the future. 

This brings us to the question why telecom products fail in even mature markets, where apparently a lot of research and planning goes into the development of the products. Research by Huthwaite International, a leading training provider and behaviour change specialist, identifies fear of change and skills shortage as having a crippling effect on product success. 

According to the Huthwaite study, telecom companies struggled to launch 5.58 new products in the last financial year. It reveals that 88 percent of telecom companies experience a new product failure every year — costing the industry millions of dollars. The study found that 42 percent of the industry’s senior decision makers believe the reason behind a product failure is consumers’ resistance to change. In addition, 30 percent of sales professionals associate a product failure to its specifications which are not in sync with consumer needs, while 29 percent of a sales force show resistant  to change as a reason for poor achievement in selling new products.  

Telecom companies overlook a major loophole within the sales force that points to an inconsistency in how sales professionals perceive selling. Nearly 43 percent of respondents considered the ability to sell a product’s solutions rather than its features to be the most crucial attribute, while 26 percent of them believe a seller’s inability to identify and address a buyer’s concerns is responsible for impeding sales. In both cases, a clear lack of strategy is what is causing wide-ranging product failures. 

A plausible explanation to this problem is lack of systematic approach in sales strategy. Huthwaite’s findings showed that telecom companies with a systematic sales approach have an average growth of 30.5 percent, compared to 22 percent of those lacking it. Yet, 37 percent of respondents have not adopted a systematic approach to sales across departments — and 45 percent of them would invest in sophisticated marketing as an alternative to poor sales. The research showed that the sales forces’ prime focus is on selling a product’s features and not solutions. 

Tony Hughes, CEO of Huthwaite International, said: “The telecoms sector is one of the most likely to see a huge amount of interest in new products initially, but with a quick drop off rate translating in few sales. By analysing the sales approach of such companies, we know that a systematic approach is especially important for the highly innovative telecoms market, with multiple product launches happening each year.” The telecom industry is anticipated to see major new product launches as telecom companies take on challengers amid tight revenue growth. But not getting the product and sales strategy right could lead to more product failures in the future. The right product and sales strategy is important as they have a major bearing on the net promoter score.

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The proposed joint venture would have been worth $40 billion including debt, according to several media reports. Telenor said in a statement that both companies have agreed to terminate discussions owing to complexities in the proposed transaction. 

Media reported that although some elements of the deal can be worked out, other aspects were not agreeable to both companies.  

If the deal had taken place, Telecor and Axiata would have held 56.5 percent and 43.5 percent stake in the joint venture. It would have combined both telecom companies’ Southeast Asia and South Asia operations. 

Axiata is a Malaysian telecommunications conglomerate with operations in Asia. 

Both companies realise the strategic relationship of the proposed transaction and have not eliminated the possibility of a future transaction. 

Axiata’s Chairman Tan Sri Ghazzali Sheikh Abdul Khalid told a local media report, “The board acknowledges the strong strategic rationale of the proposed transaction and is equally cognisant of the level of complexity of such a deal that extends across nine countries and 14 major entities.” 

He also added that the broken merger will not have any negative impact on the group’s Digital Champion ambitions. The Malaysian telecom hopes to become the New Generation Digital Champion by 2022. 

The merger talks were officially announced in May. It would have been Asia’s largest cross-border merger, excluding China and Japan. Both companies have been working on finalising transaction agreements over the last four months — expected to complete in the third quarter of the year. 

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The company reported that its consolidated financial results reached Dh25.9 billion for the first half of the year ending June 30. Etisalat’s net profit stood at Dh4.4 billion, with a 3.1 percent increase year-on-year. 

Its consolidated earnings before interest, taxes, depreciation and amortisation (EBITDA) was at Dh13.3 billion, with a 2 percent increase year-on-year. Etisalat’s per share price was valued at Dh0.51, an increase of 3 percent from last year, media reports said. 

With Etisalat’s net profit results, Essa Mohammad Al Suwaidi, chairman of Etisalat group, told reporters, “Etisalat’s performance in the first half of the year is a testimony of its regional leadership in the telecom sector.”  

This month, Etisalat offered a special roaming pack for customers travelling to Hajj and Umrah. The offer is a 10GB plan with enhanced data and a 14 day validity to enable users to seamlessly connect with their families back home. 

It has even strategically partnered with Microsoft to provide unique digital transformative solutions for government entities, large enterprises, and small and medium enterprises. Etisalat is in fact the first telecom provider in MENA to provide 5G network for Abu Dhabi’s new international airport. 

“We have remained focused on our core business while demonstrating agility to transform and lead in the digital space driven by our bold vision.,” Al Suwaidi said. Etisalat is exploring new avenues after its 5G milestone in the region. This opens various opportunities for the company by adding value to both shareholders and customers.

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