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Analyst Research: 72% of CSPs Say SME Sector is Huge Growth Opportunity

Contrary to many media reports, the telecoms market still has enormous growth potential. While most attention has been focused on the hugely competitive consumer market, an easier target holding huge growth potential has long been overlooked – the small and medium-sized enterprise sector. This is set to be the new battleground for many communications service providers (CSPs), with 72% telling Telesperience it represents a significant growth opportunity for them. The race is therefore on for them to find ways of tapping the SME sector’s potential in order to increase top-line revenues and shore up their profitability.

The SME sector lies between the competitive consumer market and the lucrative enterprise market. CSPs are putting enormous effort into trying to meet the needs of consumers in order to increase loyalty and spend, meaning that the SME sector is largely overlooked and underserved. This is set to change. Telesperience spoke to 50 CSPs from all global markets and found that not only did all of these CSPs see this sector as offering growth potential for them, but 96% admitted that they are not yet addressing it effectively as their SME customers had needs they were not meeting.

The reason why CSPs haven’t yet been able to tap the full potential of the SME sector is because it’s a classic long-tail opportunity. SMEs have very different needs depending on their size, business model, and market in which they operate. Addressing these needs and supporting them cost-effectively has long been the barrier to tapping this market’s potential. What’s changed is that now CSPs have the means to do this in a scalable and cost-effective manner.

In their latest report Telesperience outline six strategies that CSPs can employ today to unlock the SME sector’s potential. Key amongst these strategies is the new telecoms buzz word: “verticalization.” Verticalization is an advanced bundling strategy that involves packaging a set of products and offers designed to meet the needs of different industry verticals (eg retail, construction, legal, tradesmen etc). This strategy when combined with self-configuration capabilities enables CSPs to unlock the SME opportunity.

“Why is the SME sector the ‘undiscovered country’ of telecoms?” asks Telesperience Chief Analyst Teresa Cottam. “Partly this is due to old-fashioned thinking that lumps all enterprises together as ‘business customers’. Profitably exploiting the huge potential of the SME market requires a different mindset and approach, and the key to unlocking it is a well thought-through verticalization strategy combined with self-configuration.”

Key findings from the study
· Globally more than 99% of all businesses are SMEs
· All the 50 major CSPs in the study identified the SME sector as a growth opportunity – 72% said it was a significant opportunity
· 96% of CSPs said they were not meeting the needs of SMEs today
· 48% of CSPs have a SME programme today, but 80% will have one by 2014
· 76% say they have products that can help SMEs improve their sales and marketing, but are not packaging them as such
· providing easy control and support from the handset is seen as key to addressing this market effectively, with many CSPs either offering support for, or planning to support in the next 2 years, the following:
– self-care from the handset (76%)
– support for split roles ie business v personal persona (72%)
– user-defined controls from the handset (86%)
– self-order from the handset (80%)

Notes for Editors:
Telesperience is a UK-based telecoms analyst firm focused on how software and data helps communications service providers improve their operational efficiency, commercial agility and the customer experience they deliver. We consider where the problems lie with legacy technology, and how companies can transition to provide a more positive telesperience for their customers and a more profitable business for themselves. For more information about Telesperience see, check out our blog at or visit our B2B wiki at

This study was conducted amongst 50 large operators worldwide, which were mainly mobile or multi-service operators.

Editors can request a full media kit comprising a PowerPoint Deck, a press briefing with the Chief Analyst, or further information by emailing Darran Clements at [email protected] The media kit is available in 3 flavours: global, Europe or North America.

The full name of the study is: "Developing a Profitable SME business’ and the findings of this programme are contained in a report entitled ‘Six Strategies for Developing a Profitable SME business" (published 7 June 2012). We also have detailed data sheets revealing the full findings.

They can provide a free copy of the report above to your readers if they email [email protected] and quote the offer number – [yourpublication]TS0612.

Contact Information:
Darran Clements
Contact via Email
Twitter: @darranclem @teresacottam @telesperience

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